[Research] ENS-GR-01: A Ten-Proposal Governance Record for Delegation Incentives

[Research] ENS-GR-01: A Ten-Proposal Governance Record for Delegation Incentives

Draft research, not an ENSIP or an implementation-ready specification.
This is an early mechanism proposal for discussion. I hope it can be challenged and improved by ENS Delegates, contributors, researchers, and technical participants.

The full mechanism, definitions, formula, assumptions, and historical stress tests are available here:
ENS-GR-01 · A Ten-Proposal Governance Record

The current Delegation Incentives Program is valuable because it moves ENS Voting Power toward active governance participants. However, it mainly rewards a Holder who is delegated to an Active Delegate at distribution time, using time-weighted ENS balances. It does not clearly distinguish sustained personal voting, considered delegation, and delegation made only near the end of a round.

This research proposes a Ten-Proposal Governance Record. The goal is simple:

  • full personal voting should have the highest unit return;
  • delegating to a consistently active Delegate should still be valuable;
  • a Holder should revisit an early delegation choice rather than delegate once and disengage;
  • missed Delegate votes should reduce both the Delegate’s reward and the associated delegator reward;
  • new participants should begin accruing from their first governance action, while fresh wallets should not immediately outperform mature participants.

All eligible records use one shared settlement rule based on three inputs: a behavioural coefficient, time-weighted Voting Power, and a smooth diminishing-return curve. The detailed formula is in the full article.

Personal voting

Personal votes in the last 10 closed proposals Reward coefficient Meaning
10/10 1.000 Highest-return path
9/10 0.810 One missed vote has a meaningful cost
8/10 0.640 Still valuable, but clearly below full attendance
7/10 0.490 Eligible, but not equivalent to sustained participation
0–6/10 0 No settlement-eligible record

Delegated voting

A sustained delegation relationship creates two reward components:

  • a Holder component for making and maintaining the delegation decision;
  • a Delegate component for representing externally delegated Voting Power.

The figures below are behavioural coefficients, not a fixed split of any individual ENS payment. Final rewards still depend on the shared settlement rule and relative Voting Power across all eligible records.

Delegate qualified votes Holder reconfirms within five proposals Holder coefficient Delegate external-VP coefficient
10/10 Yes 0.700 0.300
10/10 No 0.350 0.300
9/10 Yes 0.567 0.243
9/10 No 0.284 0.243
8/10 Yes 0.448 0.192
8/10 No 0.224 0.192
7/10 Yes 0.343 0.147
7/10 No 0.172 0.147
0–6/10 Irrelevant 0 0

The reconfirmation would be a gasless signature initiated by the Holder within the first five closed proposals after delegation begins. It cannot prove that someone read every proposal, but it requires an active revisit of the delegation decision.

If a Holder does not reconfirm, only the Holder component is halved. If a Delegate misses votes, both components decline. Below 7/10, the Delegate is no longer eligible under this program and the delegator component also becomes zero.

Newcomers, concentration, and wallet splitting

A new participant begins accruing from their first personal vote or first delegation. However, the first cash settlement unlocks only after ten closed proposals. A new wallet therefore starts a new record rather than receiving an immediate mature-participant return.

The proposal does not claim to solve Sybil resistance completely. A person who can maintain multiple hidden identities for a long period can still benefit from splitting under a diminishing-return curve. The narrower claim is that splitting into fresh wallets does not immediately outperform stable governance participation.

What the public Round 2 data can show

The public Round 2 data cannot fully replay this design because it does not expose every address’s voting history, delegation changes, or confirmation signatures. It can still illustrate how a continuous VP curve differs from the current hard cap for the seven capped Holder records.

Scoring method Largest Holder share among seven Top-two share among seven
Current 250 ENS hard cap 14.29% 28.57%
No cap; linear allocation 26.17% 49.68%
Continuous diminishing-return curve 20.81% 40.57%

The point is not to claim that this is a finished anti-whale solution. It is to replace a hard per-address cutoff—which creates a visible incentive to split wallets—with a rule that rewards sustained governance behaviour and reduces marginal returns smoothly.

The most important unresolved implementation questions are:

  1. Whether the proposed coefficient ordering is appropriate;
  2. How to set the first-period diminishing-return parameter;
  3. How to handle pre-existing delegations at launch;
  4. How records should behave after mid-window re-delegation.

I would welcome criticism on both the incentives and the assumptions.

References: Delegation Incentives Program, Blockful algorithm documentation, Round 2 public CSV, and Round 2 metadata.

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Thanks for putting this together, and for running the Round 2 files through a different curve. The timing is good, because the three-month review we promised is due next month.

Agreed on the cap, and this is close to where we landed with nick.eth during the Temp Check (here). Caps are not a long-term sybil mechanism. We kept them as a guardrail for the pilot, and whether to remove or replace them is one of the questions for the three-month review. Your comparison of the seven capped holders with the cap, without it and under a continuous curve helps there, because it puts a number on the split incentive we had only described.

On grading delegate rewards by votes cast, our first model did exactly that and we dropped it before the RFC. With a small set of active delegates, a gap between 90% and 100% attendance pushes delegators toward the few delegates with perfect attendance, which works against the dispersion the program is meant to improve. The reasoning is in the RFC thread (here). The pilot also showed how sharp the binary rule can be. In August nick.eth, who held most of the active voting power at the time, voted on 6 of the last 10 proposals and stopped counting as active. The program’s growth metric for the month came out at −70.69% (details).

The 180-day time-weighted balance does this job in the pilot. A wallet funded last week weighs close to nothing, whatever it delegates to. That rule replaced the original hold-days factor after nick.eth showed how many dust wallets older than 180 days were sitting around (here). Counting proposals instead of days aims at the same thing.

On the last one, the pilot deliberately does not distinguish them. An earlier draft used time delegated, and we moved to time held after feedback from AvsA and James (here). Whether that trade held up is a question for the round data, not for this thread.

Thanks again for the work. The three-month review, covering all three rounds, comes next month in its own thread, and that is the better place to test these ideas against the actual distribution data. We would like your read on it there.

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