🗳 This Week in Governance - November 17
A weekly resource covering Web3 governance, politics, and power.
📣 Key Points
Serum Protocol Gets Forked
Osmosis Debates Grant Program Renewal
Cosmos Fails to Pass ATOM2.0 Whitepaper
Optimism Introduces a Grants Council for Season 3
… and much more
Voting Activity (L7)
🗳️ 20,320 ballots (-90%)
👥 10,679 voters (-55%)
📜 182 proposals (-17%)
🌐 59 active DAOs (-8%)
Let’s get into it 🔥
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🗞 News in Brief
Serum Protocol Gets Forked By the Community
Following the fallout of FTX, a major Solana DeFi protocol was emergency forked to ensure its survival. On November 12th, Serum a central order book for liquidity providers on Solana was forked by members of its community to ensure the protocol did not go down alongside FTX. Serum relied on a ‘program update key’ for the development and maintenance of the protocol. These keys were not actually controlled by the SRM DAO, the community stewarding the protocol, but by a private key connected to FTX. As a result, a group of prominent community members and developers rushed to fork the DEX. Due to the nature of open-source protocols, the fork of Serum was able to be quickly deployed from the existing code base.
Serum is notable for its importance within the Solana DeFi ecosystem as it acts as a liquidity backstop for a number of other protocols. This new forked version is now being managed by a muti-sig controlled by a team of “trusted developers”. Jupiter, Mango Markets, and other DeFi protocols on Solana have announced plans to integrate with the new version of Serum. It is now unclear what will happen with existing SRM tokenholders and its subsequent tokenomics since the fork was described as an emergency temporary fix.
Osmosis Votes on the Future of its Grants Program
The Osmosis community is currently voting on whether to continue its existing grants program. Originally launched in March 2022, the Osmosis Grants Program was set up to fund community-built tooling and infrastructure on Osmosis. Osmosis is a leading decentralized exchange built on the Cosmos Internet of Blockchains. Reverie, an active service provider helping DAOs grow, spearheaded the launch of the OGP as the Program Lead alongside community-sourced reviewers. Over the course of the program’s first six months of existence, it approved 43 projects and disbursed over $1.9M in total funding. On October 31st, Reverie posted to the Osmosis forums a proposal to renew the OGP with revised updates. Details of the proposal include a full 12-month engagement, compensation of 55K USDC per month & 25k OSMO per month, and the incubation of new subDAOs.
The fallout from the grant program renewal proposal has been mixed with some community members requesting more transparency on the decision-making process and the team’s workload. On Tuesday, a disgruntled project that was denied a grant posted to Twitter a tweetstorm alleging misuse of the grants program. Competing proposals have also popped up that look to challenge Reverie on cost, scope, and structure. The terms of the agreement stipulate a governance vote will revisit the terms in six months with the ability to terminate the agreement at any time through a governance proposal. At the time of publication, the proposal is up for a vote and is currently being rejected. Voting ends on November 19th.
Cosmos Fails to Pass Atom 2.0 Proposal
On November 14th, Proposal 82 failed to pass a community vote ultimately rejecting the proposed new vision for the Cosmos network. In the proposal, an updated white paper was introduced to help update and transition the platform into its next phase. Resistance and controversy followed the proposal from start to finish as multiple stakeholders weighed in. In the end, the contentious vote swung back and forth in the final hours but ultimately ended with a 37% ‘No With Veto’ vote signaling the failure of the proposal. Some of the arguments against the proposal include changes to the ATOM issuance and more generally the overall density of the proposal. Members of the Cosmos community have called for the dismantling of the proposal into many different proposals to better gauge the contents. The Cosmos community now looks to reconvene on possible next steps for the best path forward.
📡 Coverage
📖 READ our latest brief on Optimism, a look back at Season 2, their proposal to form a Grants Council, and what’s in store for the Layer 2’s Token House.
📚 Good Reads
“Governance Attack Vectors” from StableNode
“This Billion-Dollar Crypto Collective Is Tearing Itself Apart” from Wired Magazine
“Gitcoin expands governance participation to long-term partners” from Gitcoin
“Let’s Revamp Tokenomics to Make DeFi More Useful and Valuable” from The Defiant
“DAO Legal Reforms in Spotlight as UK Law Commission Seeks Views” from CoinDesk
ENS Delegators can review their year of governance + free redelegation until EOY
“A call to Build Smarter Self-Custody” from Safe
“Taking A Long-Term View of Web3” from Haun Ventures
“Aave Grants Retrospective” from Sovereign Signal
🧵 Threads
“ATOM 2.0 proposal for the future of the Cosmos Hub has come and gone” by Kevin Peng
“5 key things to know $STRK token” by LordSecretive
“Thread regarding the past 2-3 weeks of software/biz dev, & DAO activity at Sushi” by Jared Grey
“In response to current market conditions, Maker governance executed several parameter changes” from MakerDAO
MakerDAO unaffected (for now) by Gemini Earn’s withdrawal pause
“Sorry, but equity companies are not the future of public infrastructure” by pet3rpan
🎧 Listens
“Will Venture DAOs Replace VCs? w/ Will Papper” on Bear is For Builders
“Business Governance-Fit Deep Dive w/ Hasu & Chris Ahn” on Bell Curve Podcast
“What Lessons DAOs Can Learn from Corporate Governance w/ Larry Sukernik & Derek Hsue” on Bell Curve Podcast
“DAOs After Lifestyle w/ Toby Shorin” on Building At The Edges
“Reputation and Compensation in DAOs w/ Tracheopteryx” on DAO or Never
⚡ Breakdown: StableNode
🎧 LISTEN back to our conversation with the StableNode team. We discussed their biggest lessons from MakerDAO, delegate competition, values-first governing, and more.
📜 Proposals
Gauntlet <> Aave Renewal
This proposal is to extend Gauntlet’s work at Aave for an additional 12 months. For the past two years, the risk management platform has worked closely with Aave and now looks to continue its relationship. In the proposal, the firm explains its focus will center on managing market risk and optimizing capital efficiency. This proposal would renew their current engagement with Aave until Dec 4th, 2023, and includes an estimated compensation package of ~$2.4M. Approval of this snapshot vote will be followed by an on-chain vote.
✅ 99% voting ‘YAE’
⏰ Voting Ends: Nov 23
⚡ Type: Snapshot Vote
💬 Read the discussion
✍ Author: Paul Lei
Update to FWB Mission, Vision, Strategy, and Principles
This proposal looks to ratify and update the Friends with Benefits’ vision, mission, core principles, and strategic approaches to help unify the DAO. The proposal states their mission to be the following: “FWB is the social convening point for the individuals, squads, and institutions using decentralized technology to build a better internet. As a community, we aim to push culture forward while elevating and amplifying each other in the process.” Their core principles include collective effort, good neighbors, culture over crypto, open experimentation, civic engagement, give before you get, and have fun. A new FWB season will kick off following the approval and ratification of this vote.
✅ 99% voting ‘Approve proposed updated’
⏰ Voting Ends: Nov 21
⚡ Type: Snapshot Vote
✍ Author: emersonkirk.eth
Core Team Funding
This proposal aims to renew the full-time team charter for community members Flex Chapman, Commodore, and Mario Lopes. Krause House currently retains these three members as their sole full-time contributors. The proposal seeks to ratify and extend their work for the next six months. In the proposal, compensation of 40K USDC and 10K KRAUSE is to be paid out monthly for the entire six months. Important to note that the contributors can be fired at any time via a governance proposal. The Krause House DAO treasury currently holds $1.3M with additional plans to narrow the criteria for projects funded, onboarding more full-time contributors, and diversifying the treasury. The proposal also provides a full retrospective of previous work done by the contributors and their biggest lessons.
✅ 70% voting ‘For’
⏰ Voting Ended: Nov 15
⚡ Type: Snapshot Vote
✍ Author: thycommodore.eth
Selection of an ENS endowment fund manager
This proposal is a follow-up to EP2.2.4, a call to find a fund manager for the upcoming ENS endowment. Here, a shortlist of finalists is being voted on that includes Avantgarde, Karpatkey, and Llama. The ENS Meta-Governance stewards were tasked with sourcing a shortlist of suitable candidates from a larger batch of applications. The winner of this vote will work with the stewards to form a treasury allocation strategy with more proposals expected to follow.
⏰ Voting Ends: Nov 22
⚡ Type: Snapshot Vote
💬 Read the discussion
✍ Author: nick.eth
CIP-1: Compound Improvement Proposal Adoption
This proposal looks to implement an Improvement Proposal Process to the Compound protocol. IP is a popular governance process used by various protocols to streamline and structure their governance. Compound Improvement Proposals describe standards, processes, and enhancements intended to improve the Compound Protocol. There are three types of CIPs: Meta Process, Protocol Enhancement, and Tooling & Support. The proposal illustrates the lifecycle and operating procedure to pass CIPs.
✅ 100% voting ‘Yes’
⏰ Voting Ends: Nov 23
⚡ Type: Snapshot Vote
💬 Read the discussion
✍ Author: Michael Lewellen
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