🗳 This Week in Governance - November 10
A weekly resource covering Web3 governance, politics, and power.
📣 Key Points
Optimism’s Token House introduces improvements for Season 3
dYdX outlines plans for the future of its DAO
Index Coop looks to partner with Balancer
BitDAO asks for proof of custody from Alameda
Gauntlet requests a 12-month work agreement from Aave
Activity:
🗳️ 216,499 ballots (+564%)
👥 23,952 voters (+27%)
📜 219 proposals (+11)
🌐 64 active DAOs (+16%)
Let’s get into it 🔥
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📡 Coverage
📖 READ our latest brief on Gauntlet, their proposal at Aave for a 12-month work agreement, and why it matters.
🗞 DAO News in Brief
dYdX DAO Plans Its Future
The dYdX foundation has published a blog post requesting community input on the future direction of dYdX DAO. dYdX v4 is the perpetual exchanges’ planned protocol upgrade for Q2 2023. In this new version, the protocol becomes fully decentralized and in need of community stewardship. In their blog post, the Foundation introduces potential next steps to implement a more ready and structured DAO. The post also serves as a call to action to source feedback on some of their ideas. SubDAOs are being introduced to help segment the workload starting with the formation of an ‘Operations subDAO’. This subDAO would be one of the initial subDAOs formed to help facilitate the development of the larger DAO. SubDAOs are to handle specific core functions within the protocol such as finance and treasury management, growth, risk management, community, and more. Today, the dYdX community is comprised of the dYdX Grants Program (DGP), which would continue as a self-sustained subDAO. On Wednesday, Reverie posted a possible path forward with the creation of an ‘Operations Trust’. DYdX’s current governance process will be used to confirm any of the proposed changes.
Optimism Concludes Season 2 Plans Changes
Optimism’s Token House continues iterating its governance process. This time around, the Optimism Foundation has published a series of proposed changes for Season 3. On November 11th, the Token House will conclude Season 2 followed by a retrospective and pre-season period to update its processes. The Foundation has been hard at work creating fixes for some of the issues running rampant within its governance experiment. On Tuesday, they posted on the forums a guide to Season 3 alongside five posts detailing proposed fixes for Season 3. Within these plans are a new Governance Fund Charter, a delegate code of conduct, a proposal to introduce a grants council, a proposal to allow protocols to have a delegate voice without self-delegation, and a retroactive reward for delegates. The two draft proposals will be voted on in the upcoming ‘Special Cycle 9’, a pre-season cycle that votes on changes to the Houses’ processes and structure. Community feedback and input are now being gathered on the proposed changes as the Foundation struggles to steward the DAO. Season 3 is tentatively scheduled to resume on January 19th, post-holiday break.
Index Coop Seeks Balancer DAO Partnership
Index Coop, creators of onchain index products, posted a proposal on the Balancer forums seeking a partnership between the two protocols. Index explains the idea for a partnership comes as a result of their new product offering, ‘Diversified Staked ETH Index’ (dsETH). This new product offering and other planned products will be built on top of Managed Balancer Pools. These pools provide Index with an easy-to-use and dynamic pool of funds that can be structured in a multitude of strategies. In an effort to strengthen the partnership with a long-term focus, Index has proposed a product fee split, a 1:1 treasury token swap, and enabling veBAL gauges on select products. The fee split would have Balancer receive a percentage of all produced MBP fees from Index’s products. The token swap will be comprised of 100K INDEX for a proportional amount of BAL to be locked for a year. The creation of veBAL gauges within Index’s new products and future MBP-based products to help drive more BPT staking. Sentiment in the forums has been positive and the proposal is likely to go to a vote in the coming days.
BitDAO Pulls Proposal Amongst Market Turmoil
BitDAO, an investment DAO created by Bybit and funded by Peter Thiel among others, canceled its governance proposal this week in light of risky market conditions. BIP-15 was a proposal to deposit part of the BIT treasury into a vault to earn yield. The vote was vacated by the community amid worries of a market decline off the back of FTT. Back in October of 2021, quantitative trading firm Alameda engaged in a token swap with BitDAO. The DAO swapped 100M BIT for 3.3M FTT and was touted as a great idea at the time by Alameda to align the two organizations. The move gave Alameda a large amount of voting power within BitDAO while giving BitDAO exposure to FTX, the centralized exchange. One year later, the FTT token began plunging off the news that Binance, which holds $2B in FTT, is looking to potentially offload its position. Alameda is famously founded by SBF, the FTX CEO. Rumors began to circulate that Alameda potentially held a significant portion of their balance sheet in FTT. These rumors led to a huge amount of sell pressure on the FTT token. Following this news and worried Alameda might sell its assets, BitDAO requested proof of custody from the firm. The DAO worried the trading firm would dump its 100M BIT holdings amid FTT’s rapid decline. On November 8th, the DAO was able to resecure the funds and verify assets from the original deal had not been sold. Also on Tuesday, FTX publicly announced they had entered into a non-binding sale agreement with Binance. The centralized exchanges’ native token FTT proceeded to decline by 60%. On Wednesday, Binance shocked everyone when they announced they had rescinded their offer to purchase FTX.
📚 Good Reads
“Paying People to Participate in Governance” from a16z Crypto
“The State of Treasury Management for DAOs” from StableNode
“Understanding Aera Finance” by Emperor
“What Is a SubDAO? A Way to Keep Governance Decentralized” from Blockworks
“Osmosis Grants Program Renewal” from Reverie
“Aave: October 2022 Financial Report” from Llama
🧵 Threads
“What’s in EIP 4824, and why it is important for DAO contributors and builders?” from DAO Research Collective
“30-second summary of the FTX drama” by Shaan Puri
🎧 Listens
“DAOs Need Co-Created Structures w/ David Ehrlichman” on Building at the Edges
“Empower the DAO by Empowering the Contributor w/ Aaron Soskin” at The DAOist Bogotá
“Paul Lei, Protocol Program Manager at Gauntlet” on Genesis Block Podcast
“Krause House DAO Governance Learnings w/ Commodore” on DAO Governance Education Sessions
“Tiered Governance with Wonderverse” on DAO Governance Education Sessions
🌱 Breakdown: Scott Moore
🎧 LISTEN back to our conversation with governance delegate Scott Moore. We discussed his Gitcoin steward journey, multi-faceted delegation models, backchanneling within governance, and more.
📜 Proposal Roundup
Governance Fund S2 Cycle 8: Messari
This proposal requests funding for Messari through Optimism’s Governance Fund Cycle 8. In this proposal, the data and analytics firm requests 365K OP to “provide the Optimism community with quarterly governance, ecosystem, and financial reports while continuing to build out subgraphs for the ecosystem.” Messari provides quarterly and financial reports for over 35 different protocols such as Balancer, Venus, and Aave. The ‘Tooling Governance Committee’ has voted ‘Abstain’ on the proposal.
➖ 76% voting ‘Abstain’
⏰ Voting Ends: Nov 10th
⚡ Type: Snapshot Vote
💬 Read the discussion
✍ Author: Jack Purdy
Season 6 Seasonal Funding
This proposal looks to ratify the Department, Guild, and Project funding requests with 22,032,292 BANK for the upcoming season at Bankless DAO. The projects were previously approved by the Grants Committee and now seek distribution approval from the DAO. Funding is broken down as follows: Department requests 3,730,635 BANK, Guild requests 6,226,000 BANK, and Project requests 12,075,657 BANK.
✅ 90% voting ‘Approve’
⏰ Voting Ends: Nov 11th
⚡ Type: Snapshot Vote
✍ Author: links
Community Initiative To Unpause Token Contract
This proposal requests making the SAFE token transferable. The initial implementation of the SAFE token was created as nontransferable meaning it could not be moved or bought. This functionality was introduced to mitigate airdrop dumping and prevent potential governance capture at project inception. The proposal argues the current pause gatekeeps governance for those who don’t hold the token and may wish to participate. This is the most contentious vote to date at Safe DAO with over 1,700 votes cast.
✅ 74% voting ‘Make no changes’
⏰ Voting Ended on Nov 10th
💬 Read the discussion
⚡ Type: Snapshot Vote
✍ Author: Daniel
DAO Coalition Funding
This proposal aims to approve fundraising of $9,999 from the DAO treasury for a DAO coalition. This coalition is comprised of 30 DAOs and related organizations that look to advocate on behalf of DAOs in the US and around the world. DAOs in the coalition include Aragon DAO, Bankless DAO, Krause House, Kali DAO, LexDAO, Polygon DAO, and more. The requested funding is earmarked for legal fees related to its incorporation and creation.
✅ 99% voting ‘Approve’
⏰ Voting Ends: Nov 10th
⚡ Type: Snapshot Vote
💬 Read the discussion
✍ Author: da3vid.eth
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