Thank you for clearly outlining your ideas @dennison I believe these arguments are DAO agnostic, i.e. all gov tokens without an incentive for users to hold them are down only and hence the current model will only lead to reduced token participation.
We state in our research also that ‘Enthusiasts, true fans, and wealthy idealists are the only ones who’ll stick to an unpaid governance work or malicious actors who fake it until they can execute a governance attack.’
This is an interesting idea and can possibly compliment the liquid staking strategy, but difficult to supplement it since the user base of seeking APY is much higher than the user base of seeking specific perks at ENS DAO or using the product.
There will be more token holders and consequently stakers when the yield on the token is high .i.e when the ENS product suit is growing in usage. This also aligns the incentives of the delegates who will receive these delegated tokens from the DAO to increase product adoption and usage as opposed to engaging in other forms of politics. The delegate compensation can then be tied to product usage which ultimately aligns incentives of stakers, delegates and the DAO as a whole