🗳 This Week in Governance - November 10: Solvents, Setbacks, and Security

A weekly resource covering crypto governance, politics, and power.

Nov 10, 2023

Aragon Association set to dissolve
Arbitrum Coalition suffers setback
Sushi considers new tokenomics
Aave community addresses security vulnerabilities

Voting Activity (L7)
🗳️ 228,552 ballots
👥 64,281 voters
📜 270 proposals
🌐 55 active DAOs
Query more data using the Governance API

Let’s get into it 🔥

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📰 News

Aragon Association set to dissolve

The Aragon Association is embarking on a new phase by allocating the majority of its treasury to allow ANT holders to exchange their tokens for ETH, dissolving the Association itself, and pursuing the mission through a product-centric framework. Initially, Aragon aimed to revolutionize DAOs but faced challenges, such as unsuccessful attempts to establish a court system, an appchain, and difficulties turning a DAO framework into a protocol with value capture. Governance complications and a disconnect between the treasury value and the token market cap led to the decision that a fundamental restructuring was necessary to advance Aragon's mission under new leadership. As noted in The Defiant, “there is an irony to Aragon’s struggles. The project’s founders designed Aragon to revolutionize how organizations ran, but in the end, encountered some of the same struggles that it aimed to help other operations to overcome.”

Arbitrum Coalition proposal suffers setback

As we wrote last week, the Arbitrum Coalition — led by Blockworks Research, Gauntlet, and Trail of Bits — has proposed to facilitate the realization of ideas from the Arbitrum DAO community into actual projects over a 12-month term. The motivation behind this is to improve the research, design, and risk assessment of community proposals, leveraging the specialized expertise of the coalition members. But, while the vote proceeds apace, there has been significant pushback from the community concerning the specifics of the coalition's operations, such as reporting on work hours, ensuring transparency and alignment with DAO priorities, concerns about potential conflicts of interest, and mechanisms for evaluating the coalition's effectiveness. L2BEAT has stepped down from its pre-appointed role of DAO Advocate in the proposal, even while continuing to support its intent. It suggests opening up the role to an election process. Blockworks research has since posted a revised approach to implementing the proposal, should it pass.

Sushi considers new tokenomics

The Sushi team is soliciting community feedback on a proposed revision of the Sushi token model, designed to support protocol sustainability, enhance token utility, and achieve treasury diversification. The new model addresses current challenges, such as liquidity subsidization costs and the emissions-to-income ratio, with solutions to recalibrate LP incentives and xSushi staking benefits. The proposal aims to foster a resilient token economy, with strategic scaling through DEX innovations and partnerships, while aligning with stakeholders' interests like liquidity providers, xSushi holders, and the Sushi Treasury. Responses so far indicate a desire for greater clarity and understanding of the proposal's details and implications and a need for information accessible to those without a financial background.

📜 Proposals

Recently Closed

Illuvinati Council: Which Illuvium Main Council Nominee would you like to vote for?

The Illuvinati Council is a governance body for the Illuvium protocol, proposed to be established during the protocol's early stages. Votes for council nominees are weighted by a formula based on the voter's vILV balance, which accounts for staked ILV and locked ILV. To vote, wallet holders select a candidate and authenticate with their wallet, with recent Improvement Proposals (IIPs) affecting staked and vesting wallets, council pay, and blind voting impacting this process. The voting period closed on November 8th, with Animostas receiving the largest portion of votes (26%).

Ending Soon

Arbitrum: Proposal to Backfund Successful STIP Proposals

The proposal, put forward by delegate.l2beat.eth, calls for a one-time backfunding of all approved but unfunded proposals from Arbitrum's Short-Term Incentive Program (STIP), with an increased budget allocation of 21.4M ARB for a total of 71.4M ARB to support 56 projects. The initiative intends to leverage existing systems and timelines from STIP 1 for distribution while adhering to previously established KYC and reporting protocols. It is motivated by the need to include a wider range of projects, particularly smaller and emerging builders, to foster diversity, uphold the community's inclusive values, and gather comprehensive data for future grant structures. The voting period ends on November 14th.

Upcoming

Aave: Multichain Stable Debt Token Upgrades

The Aave community is set to vote on BGD Labs' proposal to address security vulnerabilities by updating stable borrow implementations and halting new stable debt token minting across v2 and v3 platforms, following the pausing of several markets due to a security threat. The proposal, which has been tested and reviewed, includes a new feature called the "Liquidations Grace Sentinel" to provide users with a delay on liquidations once services resume. Voting is scheduled between Nov. 8th and 11th.

🎙️ Rather Listen?

The Boardroom Roundup brings you the latest DAO news headlines and governance proposals every week:

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📚 Reads

Cultural Memory, by wiz
Open Problems in DAOs, by Tan, Merk, Hubbard et al.
Blockchain Constitutionalism: The Role of Legitmacy in Polycentric Systems, by de Filippi, Mannan, Nabben, Cossar, Kamalova, and Merk
DAO use cases, from juliettech

🎧 Listens

Meg @ Gitcoin, on DAO Talk
What’s Wrong with DAOs, Coinbase Earnings, and Arbitrum Staking Prop | Analyst Roundtable, on 0xResearch
Building the Factory for DeFi, w/ Charles St. Louis (DELV), on StablePod

💬 Forums

Aave: Introducing voting seasons for Aave DAO

A proposal on the Aave Governance forum suggests introducing designated voting days and a separate space for temp check proposals to manage the high volume of submissions and reduce voter fatigue. Responses reflect a mixture of agreement and disagreement: some members support structured voting to prevent decision fatigue and ensure proposals receive adequate attention, while others, including recognized delegates, oppose the idea, arguing for the continuation of the current permissionless and continuous governance model.

CityDAO: Install a Sign

This post on the CityDAO forum addresses the need to install a sign on Parcel 0, which has been pending for over two years. The sign needs to be able to endure severe weather conditions, have changeable messaging, be installable on hard terrain, and maintain a professional appearance. The proposed budget for the sign and its installation, including project management, totals $3,300, with specific team roles to be determined and managed by the OP, Casey.

dYdX: Upgrade Markets to Active on the dYdX Chain

This post proposes transitioning from the Alpha to the Beta Stage on the dYdX Chain by enabling trading on all markets, aimed at further testing and development of the new network. Community responses support the proposal, emphasizing the need to incentivize token staking and expressing anticipation for the network's development. However, concerns have been raised about the current centralization of validators and the associated risks, suggesting a more gradual transition towards decentralization and querying about the implementation of transaction fees.

ENS: Drafting of ENS DAO bylaws

The Meta-Governance working group is requesting proposals for drafting a comprehensive, clear, and adaptable set of bylaws for ENS DAO governance, to be shared under a Creative Commons license. The bylaws will encompass rules for working groups, voting procedures, amendment processes, governance of the endowment, and the establishment of roles for governance documentation and process administration. Submissions are open until November 21, with a review of entries to be completed by November 28.

Boardroom