A revenue share for holders or stakers runs counter to article III of the constitution. I think that paying governance participants for their time is a very good idea, and something we should investigate - but itād be more a case of sharing out a governance budget amongst participants than anything that depends on the registration revenue.
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voting and staking can be taken at same time, we can have our platform to do this like terrasation.
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Yeah in regard to income I guess I disagree with our constitution. I think we will drive more change and attract more talent to our community if we prioritize our DAO and incentivizing community participants. Unfortunately the dirty truth is that the DAO needs two things to survive; Income and participants. Looking forward to seeing more discussion around these topics if they do arise.
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I think incentivizing community participants is a great way to help the DAO bring in new members and facilitate discussion, but I fear a staking mechanic could have the opposite effect for two main reasons:
- It may make members feel that to āfullyā participate that they need to stake their ENS tokens - with gas fees so high this would be burdensome for many members.
- It would also put a very constant strain on the treasury to fund staking rewards - this would have the opposite effect of generating income for the DAO.
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I donāt think staking or rewarding token holders with revenue from ENS operations is in line with ENSās core ethos or constitution. Some kind of incentive for delegating your tokens could be interesting, though - particularly if it was tied to the delegateās activity level on onchain votes.
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I am against it. I would rather see ENS have to ask for donations every year like Wikipedia than run as a for-profit model. Even if that profit is just essentially dividends or staked interest. I think what you are describing is how centralization starts, because humanity always wants more and more and moreā¦
I respectfully have to disagree with you there. I think what you are describing is the model that already exists, because the incentivization you are speaking of is āmonetary gain before all else.ā
Maybe if it helps, try thinking of holding ENS tokens and participating in itās trajectory as a public good responsibility and not a means to an end. I understand that not everybody wants to contribute without a financial incentive to do so, but I would propose that maybe that is the whole point of not providing one. I hate that some of the things I say might border on sounding cultish, but having grown up along side the webā¦ I just donāt want the future of the web to be like the current centralized web is now, that is what motivates me to be involved in this project, and to hopefully help the Web3 space resist just being an echo of the current centralization as much as possible.
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I understand your concerns and I would be extremely against us turning into the facebooks or amazons of the world. I really believe there is a fine line which we can aim for which will be a mix of both worlds. The truth is, income, participation, and a devoted community is the best defense and offense in the tech world. It is in the DAOās best interest to ensure we maintain a healthy balance between those three subjects otherwise there was really no need to create the DAO in the first place. I understand your aversions and you are 100% not alone.
Thanks for taking the time to write this response.
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Could there be a way to stake the tokens and choose from one of a number of ethereum community projects or initiatives to donate our rewards to? This way we are rewarding participants but perhaps not in conflict with the spirit / constitution?
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I think we probably want to avoid becoming GitCoin. Theyāre better at it than we are!
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I am opposed to this proposal. The main issue is the constitutional concerns already raised.
ENS seems well funded as-is to be able to support its mission. Trying to incentive increased economic impact of ENS at this time doesnāt seem wise.
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Given that the security of the DAO is partly dependant on the price of the ENS token, I donāt think it is unreasonable to disincentivize selling and reward holding + participation (delegation and other metrics) with a portion of the registration fees. Also lots of selling will erode the number of delegated votes over time.
If the community is rewarded for the number of registrations then this could also be a great marketing tool and help drive name registrations.
I donāt believe this runs counter to article III as it would encourage delegation and active participation in the DAO as rewards would be based on participation, which is good for ENS. Iām not sure what the difference is between paying people a salary and giving them a percentage of fees. The percentage mechanism reduces the amount of work and thinking it would take to reward active participation.
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Love your take on this. I agree with you completely.
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Given that the security of the DAO is partly dependant on the price of the ENS token, I donāt think it is unreasonable to disincentivize selling and reward holding + participation (delegation and other metrics) with a portion of the registration fees. Also lots of selling will erode the number of delegated votes over time.
@Leon hey, let me expand on this as well a bit, Iām looking at this situation from perspective of financial analyst
ENS DAO is not equity token, and not your typical fiat financial instrument whose existence is strictly mandated by the presence of cashflows to paid to the holder, in the context of blockchain based assets all mechanisms are very different to fiat instruments
however when taking into consideration introduction of any new token mechanics it is vital to understand why are we introducing this mechanics
potential upside to this mechanism:
- ENS DAO is to instituted to serve broad userbase of ENS protocol
- one of key requirements for ENS to be global public protocol is to be very stable
- security of DAO is dependent on price stability and on having as diverse base of holders as possible
- passive income generated from this approach fits into broad protocol narrative very nicely
the downside to this approach are negative spillovers:
ā some agents will choose to hold tokens only for financial incentive and not for long term development of protocol
ā voting power will be delegated to those delegates who are in favour of increasing financial incentives
ā some other unintended effects which may distort otherwise beneficial approach
I think the bottom line to this discussion is not to drop this question completely because it may go against moral principles or some ethical approach, but rather have strict, disciplined and very clear understanding WHY is it being implemented - if it serves greater good, then it must be implemented in some form
Afterall whole PoW consensus is based around game theory, where every agent is pursuing SELF interest, and in the process this generates robust āgreater goodā, certainly there are negative spillovers for example in the form miners front-running transactions, but end result is āglobal decentralised ethereum computerā which certainly benefits a lot of people around the world, like a great equaliser. PoW would not be possible unless it had built in financial incentives
So I think its incorrect just to drop this idea, best approach in my opinion is to try to get specific draft analytical constructions, put them through delegates discussion machine and see if anything can fit overall DAO benefit
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Iāve got to disagree here.
The minute you pay for governance participation, you expose the entire system to moral hazard.
Iām not seeing the correlation. If anything, dripping a small incentive to ens holders who use the tokens/coins as a governance mechanism instead of a market speculation coin is more inline with article III than outright paying for governance.
Is there a means to see/query/whitelist which wallets delegate votes to which delegates? Iām not so savvy on the tech side of DAO token delegation. And given another hour or so, would likely just ask one of my devs when they get into the office.
If so though, could my dev lab or any others (like coinbase) create their own reward token payable (airdrop?) and then recurring, to those that delegate to them? Obviously only really beneficial if that delegate is active in governance.
Coinbase, on the other hand, and really notably - didnāt vote for the first proposal post-constitution?
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Not doing so is also a hazard - it results in a situation where the only people who can afford to participate in governance are those who are financially comfortable, or receiving external compensation - eg, lobbyists.
If we want professional governance, we should be prepared to pay for it.
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Moral hazard and hazard are not the same thing. One of them is specific to a level of accountability and fiduciary duty to others against financial self-benefit.
Second, not one person, not even you up until now, said you wanted āprofessional governanceā.
You said, and everyone else agreed, you wanted DECENTRALIZED control. AUTONOMY.
Thatās the D and A of DAO, right?
Itās quite clear youāve got your mind made up, no matter how much expert opinion you receive from very well credentialed and educated business professionals.
More than your mind made up though, it seems like youāve got a roadmap already of how you expect the scenario to play out, two decisions in advance - but that roadmap is seemingly based on misunderstanding of commonly known company & organization culture drivers/dynamics.
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Second, not one person, not even you up until now, said you wanted āprofessional governanceā.
@Nefty I appologise for intervening here 
, but āprofessional governanceā was indeed discussed at very early stage
Respectfully Iād like to think that Iām fairly well credentialed professional but in the world of blockchain based assets it seems to have fairly little weight, seeing how mechanisms and execution are very different from your typical āfiatā inter agent relationship
And to the point, can you please explain more clearly how is it problem having paid delegates?
ā unpaid delegates will result in skewed representation towards wealthy people, that means that certain social strata will not have a say
ā paid delegates equates playing field
You donāt even have to accept pay
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I would say that setting up an organisation where the only people who can afford to contribute are either rich or lobbyists is a moral hazard.
Iām saying that if we want people to treat it like a job (which is what makes it āprofessionalā), we need to compensate people. Itās not reasonable to ask people to volunteer to help manage a multi-million dollar piece of infrastructure.
This seems like a bit of an overreaction to me stating my opinion.
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If I may, I agree with Nick that itās unreasonable to expect people to treat DAO governance as job without offering some sort of compensation.
I donāt have a specific thought on the exact mechanism, but if someone is spending the equivalent of a part-time job on governance, shouldnāt there be some mechanism to reward that effort?
In my mind, anything other than that risks making DAO governance a job for the independently wealthy or under-employed.
Nothing about compensating people for their time and effort goes against decentralized, as assumably the DAO itself has the authority to adjust and modify any scheme it creates.
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@jake
I actually wrote up a skeleton idea of a proposal that needs much work, but it is the beginnings of an idea. The principal is that incentives essentially work from teh ground up. Users are incentivized to delegate their votes, delegates are incentivized to vote, and based on these incentives delegates would earn more the more votes they control. Thus the most popular delegates should earn enough to sustain them, allowing them to focus on ENS.
Other delegates would proportionally get incentivized. They could either vote often enough to maintain control of the number of votes they control and hope users dont choose to change delegates, or they could work harder, perhaps above their compensation level, in hopes that they āmove up the chainā.
Essentially the idea is that organically the participants could receive incentives based on the effort and participation they themselves put in. It also tosses an idea around about capping delegations such that a handful of users couldnt get majority control, or atleast not easily. Give it a read and let me know what you think!
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