🗳 This Week in Governance - April 6: Structures, Services, and Singularities
A weekly resource covering crypto governance, politics, and power.
📣 Key Points
DeFi Drama at Maker, Aave
DAO governance challenges — and proposed solutions
It’s DAO service provider season
Frax proposes ambitious Singularity Roadmap
Voting Activity (L7)
🗳️ 27,134 ballots
👥 10,010 voters
📜 246 proposals
🌐 77 active DAOsQuery more data using the Governance API
DeFi drama at MakerDAO & Aave, among others
After MakerDAO incorporated Ethena's USDe, a “synthetic dollar,” into its collateral pool — and then proposed substantially increasing its lending capacity in a move to bolster DAI usage — other DeFi entities expressed concerns, leading some to reconsider DAI's collateral status on their platforms. Critics, citing risk management issues with MakerDAO's new strategy, say these moves are to prevent potential contagion within the DeFi lending sector. In Aave, for example, there’s a proposal to adjust the risk parameters for DAI by setting its Loan-to-Value ratio to 0% across all versions and networks. Meanwhile, some defend MakerDAO's decision by pointing out the multiple backstops designed to safeguard DAI's stability.
DAO governance challenges — and proposed solutions
There’s been quite a bit of conversation on the subjects of DAO governance and structure recently. To begin with, Scott Fitsimones, the leader of CityDAO, has decided to step back from his leadership role due to the challenges of finding consensus on the DAO's direction and realizing his vision for the project. CityDAO might wind down as a result. At BanklessDAO there’s a revised proposal to restructure that aims to evolve the DAO with a focus on transparency and inclusivity. The plan outlines a two-phase process starting with discovering what is important to DAO members through DAO-wide retrospectives, discussions within guilds/departments, and possibly in-depth interviews. Meanwhile, a proposal at ENS aims to address voter apathy and increase decentralization by introducing "ENS matching" and "inertial delegated voting power." At Paladin there’s a proposal to transition the governance model to an optimistic council structure to enhance efficiency, specialization, and responsiveness, while maintaining accountability and stakeholder sovereignty. And finally, Aribtrum is considering creating an Operation Company to enhance the DAO's ability to navigate operational challenges, drive ecosystem growth, and foster innovation. The “OpCo” would be tasked with hiring full-time contributors, improving operational efficiency, fostering ecosystem growth through collaborations and grants, and pursuing strategic partnerships, all under the guidance of an elected board.
It’s DAO service provider season
Service providers have been putting themselves forward to DAOs in numbers, likely due to the combination of factors — the bull (?) market, the beginning of Q2, and project timelines among them. Here are a few such instances: Karpatkey is looking to become the SafeDAO treasury manager. Karpatkey is also looking to extend their services with the GnosisDAO, while Gnosis itself considers setting up a legal conduit to onboard Centrifuge Prime. The Euler DAO is voting on whether to renew the contract for services with Euler Labs. LlamaRisk has proposed to become an Aave risk management service provider, stepping in after Gauntlet’s departure. And finally, Bored Ghosts Developing (BGD) successfully put a proposal forward to Aave to continue funding for Phase 3 of their development services.
📚 Reads
The Impact of Governance Proposals on Token Valuation, by Kenechukwu Eze
New Hampshire Has a Better Approach to DAOs, by Keith Ammon and Bill Ardinger
What Else Could Memecoins Be? by Vitalik Buterin
🎧 Listens
The Dawn of the DeFi Civil War — Ethena, SBF, Blast, & More, on The Chopping Block
The Real Reason Why the SEC Might Be Going After Ethereum, on Unchained
📜 Highlighted Proposals
Frax: Singularity Roadmap Part 1
The Frax Singularity Roadmap, presented by Sam Kazemian and various contributors, outlines a comprehensive vision for integrating all aspects of Frax into a unified ecosystem, with Fraxtal being a pivotal achievement towards achieving a 100% collateralization ratio. This roadmap introduces the concept of Fraxtal as an operating system for the Frax ecosystem, aiming to create a digital nation, Frax Nation, complete with its own culture and digital space, and outlines the launch of Level 3 sub-communities within the Frax Network State. It emphasizes strategic resource allocation towards game-changing products and native Frax Assets, aiming for a $100B+ total value locked by the end of 2026 and establishing Frax as a full-stack protocol that innovates beyond traditional Layer 2 offerings to enhance the developer and user experience on Ethereum. Voting ended on March 30th with almost 100% voting “for.”
Open Campus: European Students Blockchain Coalition adopting the Open Campus Protocol
The European Students Blockchain Coalition (ESBC) is seeking a $15,000 grant to support its aim of enhancing blockchain education, innovation, and collaboration among students across Europe and beyond. Through fostering global connectivity, facilitating access to web3 events, and serving as a knowledge hub, ESBC intends to bridge the academic-industry gap and cultivate a comprehensive ecosystem for blockchain engagement among students. The budget will be allocated towards operational costs, educational initiatives, and partnerships, including setting up a legal entity, hosting webinars, and marketing efforts to expand the coalition's reach and impact. Voting ends on April 10th.
Safe: Unpause SAFE Token Contract (Enabling Transferability)
The proposal, initiated by a collective of stakeholders from various organizations, aims to enable the transferability of the SAFE token by calling the unpause function on the token contract, using the SafeSnap module, with unvested tokens remaining non-transferable. This action follows the completion of all predefined milestones agreed upon by SafeDAO governance, setting the earliest date for token transferability as April 23, 2024, post-voting. The proposal outlines a transition into a new phase for SafeDAO, increasing market engagement and utility of the SAFE token, while emphasizing the impact on governance participation and ecosystem growth. Voting ends on April 14th.
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