This Week in Governance - June 30
A weekly resource covering DAO news and governance
📊 This Week’s Stats
A snapshot of governance activity. Check out our Governance API
🚀 The above link can be used to make requests against the Boardroom API and is an excellent way to start exploring our governance data!
Ecosystem Overview:
Governance Activity - Last 7 Days:
🗳️ 84,727 ballots were cast on 207 different proposals 🗳️
🔴 Optimism launches with 86k+ votes in its first 2 weeks! 🔴
👥 15,558 unique voters 👥
🌐 47 DAOs with active voters 🌐
✍️ 112 new proposals created ✍️
For a deeper dive into DAO governance data, check out the Dashboard.
🗞️ DAO News in Brief
Controversy at MakerDAO
Veteran protocol, MakerDAO, has had an eventful week with one of its most controversial proposals up for a vote. Community leader, Luca Prosperi, called for the creation of the Lending Oversight Core Unit (‘LOVE-001’). The idea would have introduced a leadership structure to help oversee strategic decisions. A line was quickly drawn between those that thought the idea pushed the DAO in a centralized direction versus those that felt the idea helped the protocol streamline processes. The proposal did not pass and the vote ended with 60% against and 38% in favor. The DAO now seems poised to head towards co-founder Rune Christensen's Endgame Plan for Maker.
More reactions here, here, and here
Aragon announces DAO Experts Program
Aragon, the DAO governance and tooling platform, has launched a DAO specialist services program aimed at connecting DAOs with specialized DAO experts. The first batch of experts will include Bankless Consulting, Twali, Developer DAO, and more.
Polkadot looks to further decentralize with Gov2
Polkadot founder, Gavin Wood, has announced plans to migrate the blockchain to a new governance framework. The new framework will remove the current existing committee structures and introduce a Fellowship that broadens membership and allows anyone to start a referendum.
Gucci buys into SuperRareDAO
The Italian luxury designer has purchased $25,000 worth of RARE, granting them governance rights in the NFT marketplace. The partnership enables the fashion house to launch its own NFT exhibition titled, “The Next 100 Years of Gucci”.
📚 Good Reads & Listens
“Hasu - The Current State of DAO Governance” on I Pledge Allegiance Podcast
“The Rabbit Hole That Is Nouns DAO” w/ Brian Flynn on Seed Club Podcast
“Smart Governance Tools for Web3 and DAOs” w/ Dan Wu from Orca Protocol on Bounty Hunter
Beyond the Hype, a DAO report from the World Economic Forum
DAO governance is very concentrated, Chainalysis reports
The digitization of neighborhood associations and their offline governance
“How Tribe DAO uses Pods for Optimistic Governance” from Orca Protocol
a16z explores what web3 organizations can learn from governance history
📝 Highlighted Proposals
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Lido DAO: Should Lido consider self-limiting?
ELI5: Should Lido oversee such a large percentage of staked ETH?
For over a month the Lido community has been discussing whether it should use techniques to “self-limit” its share of staked ETH (which has recently been hovering around 30%, much larger than any of its competitors). There were several concerns raised stemming from the idea that no one organization – particularly one with a limited set of permissioned validators – should have so much control or influence over staked ETH. It was argued that there could be a governance attack within Lido, for example, and that there could be a systemic risk to the accumulation of stETH either pre or post-Merge. Among the central reasons for Lido’s creation in the first place was to prevent centralized exchanges from dominating the staked ETH market, helping Ethereum to remain “credibly neutral.” And yet, if Lido self-limited:
“if a KYC standard were to dominate the staking derivative market – and become a key DeFi building block – this could become a gatekeeper problem that ends up killing the permissionless soul of Ethereum.”
The post initiating the forum discussion is admirably thorough and balanced; the discussion that follows is robust and illuminating.
99.8% voted no
See the discussion
Uniswap: Should the Uniswap community participate in the Protocol Guild Pilot?
ELI5: Help fund the public goods-oriented Protocol Guild to contribute to Uniswap.
The Protocol Guild, a group of 110 Ethereum core protocol contributors, has been pursuing a pilot program to incentivize and deploy its members across the ecosystem: “If we believe what we are building is important, then we should structure the incentives to attract more smart people to work on it.” As part of this pilot, ChicagoDAO has partnered with the Protocol Guild to submit a proposal to the Uniswap community. The proposal asks for 500k UNI (~$2.5mm @ $5.19 UNI) to be allocated to support the public goods work of the Guild.
“Participating in the 1 year Pilot allows guild members to engage with Uniswap in a way that is values- and incentive-aligned. Simultaneously, it will allow them to continue the important work of scaling our shared infrastructure and making it as resilient as possible for the applications on top of it.”
The proposal goes on to list the benefits to Uniswap should the proposal pass. The UNI tokens would be vested for one year, and are in addition to the salaries of the contributors.
96.57% voted for
See the discussion
Bancor: Increase Vortex Burn to 100% for V2.1 & 30% for V3
ELI5: A proposal to create deflationary pressure on DeFi platform’s native token.
Bancor is a DeFi protocol that promises 100% impermanent loss (IL) protection for its liquidity providers. Controversially, this protection recently had to be paused due to “hostile” market conditions. BNT became increasingly inflationary as it was printed to cover IL during the market downturn, in turn leading to more sell pressure on BNT, which drops the token value and causes more BNT to be printed – a spiral whose structural causes some have criticized severely. This proposal aims to counter inflationary risk by radically increasing the burn rate of vBNT, Bancor’s governance token. A mechanism called the Bancor Vortex allows participants to stake BNT in return for vBNT; the Vortex Burner collects variable swap fees, and those fees are then used to buy and burn vBNT.
“This proposal is to increase the vortex burn to 100% on version 2.1 This should be ramped up from the current 15% to 100% over 2 weeks. The schedule will be 40% burn rate immediately, 70% after 1 week, and move to 100% after 2 weeks. Next, increase the vortex burn to 30% on version 3. This should be done immediately.”
Once impermanent loss protection is reinstated, Vortex burn rates are meant to return to their previous percentages.
73.94% voted for
See the discussion
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