🗳 This Week in Governance - September 29
A weekly resource covering DAO news and governance
📣 Key Points
CFTC poses an existential risk to DAOs, Cosmos releases an innovative white paper, Aragon continues on its path to form a new DAO, Aave joins forces with Llama, SafeDAO is officially live, and much more.
Activity:
🗳️ 118,295 ballots (+552% Optimism releases new proposals)
👥 17,382 voters (+113%)
📜 188 proposals (-)
🌐 62 active DAOs (-5%)
Let’s get into it 🔥
🗞️ DAO News in Brief
SafeDAO Officially Launches
Safe, formerly known as Gnosis Safe, has launched its own DAO and token. The popular digital asset platform previously voted in April to spin off Gnosis and form its own DAO. Safe describes its mission is “to unlock digital ownership by championing smart contract accounts as a standard of ownership across web3.” The project now looks to decentralize its infrastructure with the creation of a DAO and governance token.
The move to decentralize is described as having two main advantages. First, it ensures this critical infrastructure for many projects does not have a single point of failure. Second, it allows them to utilize the DAO structure to enable decentralized focus and build across different verticals. Users can claim their airdrop now through December 27th. 43K users are eligible for the SAFE airdrop and these new tokenholders are free to delegate their voting power to Guardians. It’s also important to note that no single entity or person will hold more than 10% of the total voting power and the SAFE token will be non-transferable to start. The airdrop also introduces token reward vesting as a new approach to ensure long-term interest alignment from tokenholders.
CFTC Files Charges against Ooki DAO
On September 22nd, the Commodity Futures Trading Commission filed a complaint against bZeroX, its founders Tom Bean & Kyle Kistner, and Ooki DAO. The agency alleges the protocol, its founders, and DAO all engaged in unlawful activity. In the complaint, the CFTC states Bean and Kistner transferred control of the bZx protocol to the Ooki DAO to “be enforcement-proof.” The order requires Bean and Kistner pay a $250K fine. Commissioner Mersinger of the CFTC shared his dissenting opinion arguing a need for further clarity and legislation modernization for the complaint to make sense. The CFTC claims Ooki DAO and any individual who has shown to have voted on decisions are responsible and therefore liable. If the CFTC were to be granted oversight by the courts, this would have potentially alarming legal ramifications for DAOs and their respective governance tokenholders. The fallout from the complaint is already being felt across the ecosystem. A forum post has been posted to Ooki DAO’s forums requesting community feedback on an appropriate response to the CTFC complaint. Suggested responses are currently focused on securing a legal defense for the community. DAOs will continue living in this legal grey area until legislation is modernized.
Cosmos Proposes a New Whitepaper
On Monday, contributors of the Cosmos network introduced a 27-page whitepaper that outlines a number of improvements to the network. These improvements are centered around effectively and securely scaling the Cosmos network. Cosmos is an ecosystem of interconnected blockchains. The Cosmos Hub sits at the center of the ecosystem and is governed by ATOM tokenholders. According to the whitepaper, the proposed updates would help the Cosmos Hub serve a more important guiding role. A number of updates are described in the paper. Improved security via ‘Interchain Security’ and ‘Liquid Staking’. Improved tokenomics via new ATOM issuance and fees. Improved value accrual with the introduction of the ‘Interchain Allocator’ and ‘Covenant’. Improved governance via ‘Governance Stacks’ and ‘Cosmos Assembly’. Governance Stack’s purpose is to provide a general specification and vocabulary for DAOs on Cosmos. This stack would combine new and existing components. The Cosmos Assembly is a decentralized organizational body that represents the strategic interest of the Cosmos Hub Community. This assembly, alongside domain-specific Councils, would form a “governance supply chain” that helps different entities work within the same framework. A governance proposal to confirm the whitepaper is currently posted in the forums. The whitepaper acknowledges the need to address issues such as the balance of power, proper stakeholder representation, conflict of interests, and more. An on-chain vote is expected to occur on October 3rd.
Aragon Community Votes on its Future
The Aragon community is currently voting on two proposals to fully dissolve its old DAO in order to form a new one. The first vote addresses what to do with the DAOs treasury funds after dissolving. The second vote addresses the future of the AN DAO charter, the DAOs establishing document. Aragon is a suite of DAO management applications and services built on Ethereum. Aragon Network DAO was the community governing the protocol alongside Aragon Association, a centralized non-profit. AN DAO was previously deployed on the governance contract known as ‘Aragon Govern’. On June 17th, the community voted to move to a new framework and create a new DAO since the old one did not support vote delegation, an increasingly important governance feature. Voting ends on October 5th.
📚 Good Reads
✨ “Business-to-DAO Deals Gain Traction” by Boardroom Coverage
“Aave: The Crypto Conglomerate” by Mario Gabriele
“Bicameral Governance in DAOs: checks and balances come to web3” by Samantha Marin
“When to Launch a Token” from Variant Fund
“Safe DAO Resource Allocation Model” from 1kx
“SafeDAO Participation Agreement” by Christoph
“Legally Wrapped DAOs - the Ultimate Investment Vehicles” from ID Theory
“Regulate web3 apps, not protocols” from a16z crypto
“Risk Assessment: Frax Governance” from Crypto Risk Assessments
“Perpvangelist Funding Proposal” from Perpetual Protocol
“Introducing Proposer: the easiest way to create and execute proposals” from 0xStation
CultivatorDAO X LENS: Decentralized Content Moderation in Web3
🧵 Threads
“The Potential for Contribution-based Governance in DAOs” by Stefen Delev
Aave Governance Preparations from BGD Labs
“DAOs need to stop conflating labour and community” by Jessica Smith
🎧 Listens
“Exploring Metagovernance w/ Shawn Grubb” on DAO Governance Education Podcast
“Digital Ethnography in Blockchain & Governance Reading Group” on RMIT Blockchain Innovation Hub Podcast
“Governance In Data w/ Ivan Molto & Fred Hjalmarsson of GitcoinDAO” at DuneCon
MIP81: Coinbase CFO Response to MakerDAO Community Questions
📜 Proposals Briefs
Llama <> Aave
This proposal outlines a 12-month work agreement between Llama and Aave. Llama's focus at Aave would include treasury management, protocol upgrades, growth, and analytics. Compensation would be a $1.5M base fee plus a $0-500K performance bonus based on the accomplishment of KPIs. 70% of the total fee is to be denominated in USDC and 30% in AAVE. This proposal was revised by Llama to incorporate community feedback. If successful, this snapshot signal vote would move to an on-chain vote in accordance with Aave’s governance process.
✅ 99% voting ‘Yes’
💬 Read the discussion
⚡ Type: Snapshot Vote
Sushi Head Chef Election - Final Vote
This proposal looks to culminate the Head Chef search at SushiSwap and appoint one of the five nominees. The five remaining candidates are Jared Grey, Andy Forman, Kenneth Hurley, Jared Cohen, and Pauly Walton. The top-voted candidate in this snapshot vote will be elected as the new leader at SushiSwap.
✅ 72% voting ‘Jared Grey’
💬 Read the discussion
⚡ Type: Snapshot Vote
Deprecate the Fuse Protocol
This proposal looks to fully deprecate the Fuse Protocol, remove remaining pool funds, and align on a set interest rate to incentivize users to withdraw all assets. The interest rate in Fuse pools was previously set at a flat 3% as an emergency response. This proposal will decide whether to keep the previous flat 3% fee or change the interest rate model. This is a binding snapshot vote that does not require an on-chain vote.
✅ 100% voting ‘Change interest models’
💬 Read the discussion
⚡ Type: Snapshot Vote
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