🗳 This Week in Governance - October 27
A weekly resource covering DAO news and governance
📣 Key Points
MakerDAO votes on two key proposals, Optimism Governance rattled with drama, OrangeDAO launches a fellowship program, Merit Circle DAO burns 200M tokens, Compound introduces an improvement proposal process, and much more.
Activity:
🗳️ 35,942 ballots (-82%)
👥 18,407 voters (-24%)
📜 202 proposals (+7%)
🌐 60 active DAOs (+2%)
Let’s get into it 🔥
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📡 Coverage
📖 READ our latest brief on Compound, their proposal to introduce CIPs, and why it matters.
🗞 DAO News in Brief
MakerDAO Passes Two Controversial Votes
Two proposals were voted on and passed that look to alter the path for Maker. On Monday, the DAO successfully passed MIP81 as well as a larger proposal set that includes MIP83, MIP84, and six subproposals. MIP81 is the notorious proposal to onboard Maker onto Coinbase and transfer $1.6B USDC from its PSM into Coinbase in exchange for a 1.5% annual yield. The vote ended with 146K total votes cast and a 75% ‘Yes’ vote. MakerDAO is now poised to form a legal entity capable of representing the DAO to enter an agreement with Coinbase. A larger executive governance vote is expected once those details are finalized.
Also passed this week was a prelaunch MIP set to initiate Rune’s Endgame Plan. The poll successfully passed with 141K total votes cast and an 80% ‘Yes’ vote. This prelaunch set preps Maker for the upcoming Endgame Plan with updates to its governance process and the removal of outdated processes. Critics argue that the final vote was easily swayed by Rune’s large influence within Maker and its delegates. The largest delegate to vote ‘No’ was VC firm a16z who argued against the bundling of the various proposed changes.
Optimism’s Token House Rattled with Controversy
On Tuesday, allegations surfaced that a grant recipient potentially misused their OP allocation. During Phase 0, Layer2DAO was granted 300K OP tokens. The project claimed the grant was to incentivize users and provide liquidity on Optimism. A Twitter user called ‘OPGovWatch’ posted a Twitter thread where they allege L2DAO misused the funds by bridging them to Arbitrum. Optimism is facing an uphill battle as more projects misuse or just fail to properly disclose the real use of their grant funds. Currently, there is no explicit mandate to enforce or discipline projects who misuse token allocations.
Also on Tuesday, the same Twitter user made allegations against an Optimism delegate for their potential involvement with these projects. Embroiled in the grant dumping controversy is ‘OPUser’, a well-known delegate. The thread alleges the member had deep involvement with L2DAO and potentially colluded and benefitted from their grant wins. Infighting and personal attacks ensued within Discord. As a result of these controversies, the Optimism Foundation has stepped in and is now working on a delegate code of conduct. Season 2 at Optimism ends on November 9th.
OrangeDAO Launches an Accelerator Program
OrangeDAO, a Y Combinator alum-only DAO, has launched an accelerator program. OrangeDAO and VC firm Press Start Capital have joined forces to launch a ten-week fellowship program that features mentorship and a $25K grant for web3 builders. The fellowship is aimed at very early-stage projects and ideas. It describes itself as a bridge and “micro-accelerator” for other larger and more established web3 accelerator programs. Notably, both OrangeDAO and Press Start are able to participate in any of the project’s potential fundraising rounds.
Merit Circle Votes to Burn 200M Tokens
Merit Circle, a DAO building web3 games, has passed a proposal to burn 200M of its native tokens. MIP-20 passed on Wednesday with a 99% ‘Yes’ approval altering the DAO’s tokenomics. The proposal argues that burning the tokens will help reduce the total token supply and bring fully diluted valuations to be more in line with the circulating market cap. The MC community was previously allocated 30% of the initial 1B MC token supply at project inception. Per proposal MIP-7, the community wallet would burn 6M MC tokens each month. This move effectively accelerates the burn and removes a large portion of the MC token supply benefiting existing tokenholders. This token allocation was intended to be used to drive and incentivize community participation, something that has not occurred.
📚 Good Reads
“Toppling the Internet’s Accidental Monarchs: How to Design web3 Platform Governance” from a16z
“How Protocol DAOs Should Work from a Cryptolaw (-ish) Perspective” by Gabriel Shapiro
“Paying in Tokens — What DAOs Can Learn from Startup Equity Compensation” by Raphael Spannocchi
“Governance as a Value Add” by Fig
“Why should organizations run on the blockchain?” by Kaito Cunningham
“Contribution-driven Governance” from Sismo
“Quantifying Reputation in DAOs (Part I)” from Talent DAO
“Open Source Protocols: All Value Creation, No Value Capture” by Brenner Spear
“RiskDAO: Our Vision for Active Protocol Governance” from RiskDAO
“Some Ideas for Sushi Strategy” by GoldenTree
“Coinbase Says It’s Wary of Suggested Changes to ATOM’s Monetary Policy” from Coindesk
[SEP #2] Community Initiative To Unpause Token Contract (Enabling Transferability)
“Optimism Governance Data Dashboard” from Flipside Crypto
“Bloomberg Businessweek: The Crypto Story” by Matt Levine
Compound votes to pause illiquid token markets to prevent Mango-style exploit from Decrypt
🧵 Threads
“There have been a number of interesting governance proposals recently regarding Balancer & Aura” by Callen
“8 Possible Approaches to Crypto Regulation” by DrNickA
“Endgame Voter Turnout” by Sébastien Derivaux
“Why LBSBlockahin voted NO to the controversial Endgame Plan” by @park_eth
“Ephemeral DAOs” by Jake Senftinger
🎧 Listens
“DAO Org Design: An Impact Networks Viewpoint w/ David Ehrlichman” on The Clique Podcast
“The Potential For Contribution-Based Governance w/ Stefen Deleveaux” at DappCon22
“Reimagining Organizations w/ Reuben Bramanathan” on Building at the Edges
“DAOs vs. Internet Communities w/ Jon Yan from Vector DAO” on Cross-chain Examination
“What a Molecular Gastronomist Can Teach You About Building Empowered Communities and Organizations, with Daniel Ospina of RnDAO” on The Ownership Economy Podcast
“How to effectively allocate funds to decentralized teams" w/ Daniel Ospina” on DAO Governance Education Sessions
📜 Proposal Roundup
Streamlining Budget with Utopia
This proposal looks to onboard Utopia as the budgeting and payroll software at Gitcoin DAO. Utopia is a web3 native budgeting software application built on Safe and trusted by dozens of DAOs. Utopia’s proposal at Gitcoin outlines the product and its potential value for Gitcoin. Utopia claims their product will help solve operational bloat and further streamline processes at the many Gitcoin workstreams. Amendments and updates are expected as the proposal requests further community feedback.
👥 Type: Forum Discussion
💬 Read the discussion
✍️ Author: Josiah Tullis
Q4 Focuses & Budget
This proposal outlines goals and projected budgets for Q4 at Seed Club. The DAO currently consists of four main working groups: Accelerator, Community, Media, and Product. Seed Club’s mission is “to make joining the Seed Club network irresistible to builders and operators of internet native organizations”. This proposal outlines Q4 themes at Seed Club as the following: expanding membership, scaling distribution, and improving builder support. The total projected budget for Q4 is $530k. This is Seed Club’s inaugural community budget proposal introduced to provide insights and incorporate community feedback.
✅ 100% voting ‘For (Approve this proposal)’
⏰ Voting Ends: Oct 28
⚡ Type: Snapshot Vote
✍️ Author: club.eth
GR16 Round Structure
This proposal aims to define the structure of Gitcoin Round 16 of the existing Gitcoin Grant Program as it begins its transition into a decentralized protocol. Back in August, Gitcoin DAO began discussing the future of its grant program and how to potentially progressively decentralize it. This proposal looks to kickstart the initiative with a streamlined GR16 alpha cohort launched in January 2023 and a full launch in Q2 2023. The alpha cohort will consist of only the Open Source Software, Ethereum Infrastructure, and Climate rounds. Benefits to this approach include improving & preparing operationally and technically for a future full protocol launch.
✅ 99% voting ‘For’
⏰ Voting Ends: Oct 27
⚡ Type: Snapshot Vote
💬 Read the discussion
✍️ Author: Janine Leger
IIP:-166: Deprecate MNYe, GMI, FLI-P & DATA products
This proposal looks to deprecate and remove the following products at Index Coop: MNYe, all 6 FLI-Ps, GMI, and DATA. The move is part of a larger ongoing restructuring plan at Index to scale back in size and expenditure. These nine products collectively generated $24.5K ($100k annualized) in revenue over the course of 3 months. Index claims the products did not show sufficient demand and signs of product-market fit. Active support for users looking to redeem will end on December 27th.
✅ 99% voting ‘For’
⏰ Voting Ends: Oct 27
⚡ Type: Snapshot Vote
💬 Read the discussion
✍️ Author: mrmadila
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