Should we incentivize governance participation? if so how?
Discuss.
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If you mean monetary incentives for governance participation, I want to understand where is that thought coming from. Can you elaborate?
Instead of incentivizing management, today, everyone in this community should buy ens coin and hold it like btc or eth. If everyone in the community keeps it and does not sell, then 1 ens becomes 5000$. Thatās when we support the management and ourselves. Hold the ens in your hand. Letās make it together. Let the community draw attention. May both roses win 
So one thing Iāve thought about quite a bit is how web3 is missing out on traditional organizational infrastructure. I know web3 is here to change and improve on how things have worked, but at the same time maybe we should not try reinventing the wheel, but reinvent whats built upon the wheel.
What I mean is that the reason every successful organization is built upon the traditional hierarchical configuration - CEO, Executive Board Members, SVPs - is because it works. Often times there are decisions which must be made and executed quickly, without the time to deliberate. These decisions can be better made by tighter groups.
Now, before I lose everyone to screaming about āThe Manā and web3 breaking out of typical infrastructure, just hear me out.
We have a chance to both utilize the wheel already invented, while improving upon whats built on that wheel. With vote delegation we can arrive at a very similar hierarchical role types, but with web3 at its core resulting in a fluid and bottom-driven solution. Incentives are critical to this.
At the core of the idea is to incentivize delegation and voting. Lets say we have a pool for incentivizing participation in ENS DAO. That pool gets distributed upon each proposal to every ENS which voted. If you vote directly, you get to keep 50% of your distribution, with 50% going back into the pool. If you delegated your votes, and the entity you delegated to voted, you get to keep 99% of distribution and and 1% of your distribution goes to the entity you delegated. If you do not vote, or your delegate does not vote, you keep 0% and 100% goes back into the pool for the next proposal.
These numbers are made up and for example use only. The real solution will need a lot of discussion, game theory, testing, and likely constant tuning in real world use.
My thinking behind this, is that we want to reward delegating votes as much, if not more, than voting directly. I believe it is important to put the votes in the hands of users who spend more time researching and discussing proposals, as opposed to users who glance at a proposal and simply vote to receive incentive - which ultimately would harm the protocol.
By collecting a tiny portion of the incentives distributed to ENS delegated to you, you in turn are incentivized to participate. Further, if you do not participate, your delegates will quickly leave you as they would not receive incentives for being delegated to a non-participant.
With a scenario as I have laid out, we should quickly see ENS begin to accumulate to strong users who dedicate the time to discuss, propose, and vote. This is a good thing, because these are the type of users you WANT to be proposing and voting, those with the most knowledge. You will begin to see an organizational structure come up where an isolated few users receive lots of delegations. This is not necessarily a bad thing, as it would allow a stricter, more systematic group of users to respond quickly, when necessary, to any threats or important time-sensitive decisions. For example, if DAO proposals could be set to execute as soon as a winning majority of votes had been made as opposed to waiting for a strike time, then a āBoardā of Delegates possessing enough votes to do this could coordinate together and quickly respond to any attacks or other pressing needs of the DAO.
Further, unlike traditional organizations, the ENS holders can quickly change organizational roles simply by changing their delegation.
To protect against malicious delegate-driven actors, we could:
- Use delegate caps. Any single delegate can only receive <=10% of total delegate votes, for example, at which point additional delegations would be disincentivized byā¦ yep, not receiving incentives for delegating to that delegate. (again, 10% is just thrown out as an example w/o much thought given to that number)
- Vote-signaling. A delegate must signal their vote with a time lock. During this time lock, users are free to change their delegate status. Thus if their delegate votes against their wishes, they are free to redelegate to a delegate who signaled as they wish.
- Iām sure there are more ideas here!
This is really a blueprint of an idea, and not a mature solution. I welcome the discussion this brings, as well as the critiques and additions to the idea.
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I think this is a great idea, and would love to run an experiment based on this.
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perfect!
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Itās been 4 years and thereās still little to no progress in incentivizing protocol governance.(I mean it for all projects out there, not just ENS) Honestly, itās pretty disappointing to see.
Many, myself included, are thinking about these subjects within the constraints of available bandwidth.
Please consider sharing your own thoughts, and proposing your own ideas before stating your disappointment over others not doing it for you. ENS is controlled by a DAO - we welcome participation, insights, and ideas from anyone.
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Most governance systems in crypto still arenāt truly democratic or fully functional. Iāve seen some promising ideas from Aragon around this.(theyāre doing cool work on DAO infrastructure).
What we really need is modular governance: a system where everyone, even minority holders, has real influence, whether itās over revenue or the DAOās treasury. Control should be directly proportional to each investorās stake.
For ENS, thereās no revenue flowing to token holders, but a lot of investors clearly want that. If the majority of shareholders are asking for it, they should be heard.
Revenue should go to delegates and delegators, those actually participating in governance. Just holding the token without contributing shouldnāt be rewarded, as mentioned in the post above very well.
Minorities need to have a voice on DAOs!
This topic definitely comes up during WG calls from time to time and also goes hand in hand with making delegatesā work easier, and increasing vote participation in general
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Interesting thread. There are a lot of wide intentions here but I think there are some practical steps the DAO could explore.
I would like to draw attention to this recent research What Happens When Anyone Can Be Your Representative? Studying the Use of Liquid Democracy for High-Stakes Decisions in Online Platformsā.
Given ENS deeply relies on delegated voting, I think that a campaign on improving the efficacy of delegation would be a net positive experiment for the DAO to embark on.
I say net positive given, regardless of the outcome, efforts to explore how to improve delegation should produce outputs that will be ripe for another round of analysis.
Here is a 4o summary of the recommendations proposed in the paper and Iāve added my thoughts after.
Recommendations for a DAO Delegation Program
1. Make Delegation Easy
- Build a user-friendly delegation interface: DAOs that implemented simple UI/UX for delegation saw delegation rates increase by 25% or more.
- Include delegate directories that feature bios, voting history, and policy stances to reduce cognitive effort for voters.
- Double down on making āDelegateā a right that is constantly nurtured. Currently most UI/UXs are passive.
Not necessarily optimised for: - Is this person Iāve delegated currently voting?
- Delegate information is siloed. As previously proposed, we think this data need to be on-chain and ubiquitous across all interfaces.
2. Encourage Delegate Accountability
- Highlight delegate participation rates to help voters make informed choices.
- Track and publish delegate activity to discourage absenteeismādelegate turnout was only 33% on average.
- I would consider re-delegation campaigns. ie. ENS pays a small reward to users who re-delegate.
3. Use Whitelisting and Incentives Thoughtfully
- Whitelist active or trusted delegates to help reduce choice paralysis.
- Offer aligned, non-distorting compensation, such as stipends or retroactive rewards for participation, rather than vote volume alone.
- Iām not sure I agree with this but there are definitely ways interfaces could prioritise active, or under-represented delegates when presenting delegates to users.
4. Support āBottom-Upā Participation
- Smaller and mid-sized token holders are more likely to delegate than whalesādesign programs > that nurture medium-level contributors rather than relying on elite āsuper-delegatesā.
- Again a narrow delegation campaign; makes sense.
5. Monitor Concentration Risk
- Even with low delegation rates, delegate vote share can be high due to low turnout. Avoid sorting delegate lists by popularity, which encourages herd behavior.
- Limit delegate dominance by capping delegation or implementing tiered representation schemes.
No opinions here.
6. Pair with Voter Education
- Explain the benefits of delegation in forums, community calls, and newsletters.
- Emphasize that delegation is reversible and that voters retain agency.
This is an interface UX issue. But I agree that the DAO should regularly campaign (eg on Socials) that holders have the right to re-delegate. Paired with a small rewards campaign and this adds incentives for users to change.
7. Measure and Iterate
- Collect analytics on:
- Delegation rates over time.
- Delegate voting performance.
- Shifts in turnout after program interventions.
- Use A/B testing to evaluate different designs of delegate platforms.
- Currently ENS is at 4.2% delegated/votable. This should be an easy concrete metric to benchmark against over time.
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If anything is implemented, lessons must be learnt from other delegate programs. Simply paying people to vote is not ideal, and if anything we should try to make any delegate incentives more dynamic
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True. We try.
Also true. Iāve spoken extensively with Anthony at Aragon, and am actively investigating their osx offering. Bandwidth constraints.
I agree. That said, the execution of this is complex and nuanced.
This is a protocol that many people care about a lot. In my opinion making ENS great is what is important, not enriching āinvestorsā.
You may be right, but where is the evidence of this?
My initial point still stands - who are you expecting to do this work? If you have specific ideas about how the DAO can be improved, formalise them as a āTemp Checkā, post them on the forum, and join the Tuesday Metagov call as @mely.eth suggested to discuss your ideas.
To be clear, this is an area of significant interest to me and I am happy to support in fleshing out the ideas, and pushing them (if appropriate) within the DAO. This stuff does not magically happen however so please consider proactively contributing to move these ideas forwardā¦
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First of all, I want to clarify that Iām just a blockchain enthusiast, user, and investor. I donāt have any technical background. I can only share my perspective on what could be improved. Iām just one of many stakeholders in this large and complex ecosystem.
Regarding the phrase āenriching investorsā; Iād like to reframe that a bit. Investors are people who set aside their money and put it into projects they believe in and want to see grow. Some contribute time and effort, others contribute capital. In the end, these are different forms of energy that support the ecosystem.
So I think a better way to put it is; ācompensating investors for their capital.ā
That said, ENSās token price and market valuation seem pretty strong, so maybe most holders donāt see themselves as investors, possibly because many received their tokens through airdrops. That changes the dynamic. But without real investors, how sustainable is it in the long run? I guess time will tell.
And lastly, thanks for the suggestions. Iāll do my best to contribute to the ecosystem.
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I have no doubt that governance systems will continue to evolve, and the value created by platforms will eventually flow to governance participants. Just like the Ethereum network incentivizes its validators, all governance systems will need to reward their active participants, thereās really no way around it.
Ethereum handles this through emissions while using revenue to burn and offset them. It seems like the most reasonable model, since it doesnāt rely solely on revenue, which can be volatile. Emissions, on the other hand, are more stable and non-cyclical, making them a solid foundation for long-term sustainability.
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What about those who arenāt holding tokens but have showed continual participation over multiple years?
You shouldāve been paid for that. Otherwise, itās just public service, sir.
I raised this topic already, one of the points I raised is for example that every delegate should have individual thread where he can communicate his thoughts and rationale. I even created such thread for myself - it was immediately deleted. The reason for deletion cited for the fact it would pollute the forum.
There is group of individuals who hold considerable voting power and who are loosely affiliated with ENS core, read Nick, in fact Nick himself recently increased their voting power. So those people reject the idea that delegates should be paid for their service.
So thatās that. I tried to start the process with the simplest initiative there is - creation of delegate thread and it immediately got rejected. As far as Iām concerned I donāt see how this will move beyond wable wable on forum.