[social] Governance Distribution Program (Pilot)

šŸ—³ļø Meta-Governance
1

Objective:

This proposal establishes a 1:1 ENS Matching Program for eligible recipients, defined in forthcoming proposals. Initially, it applies to grantees and USDC recipients listed below. Long-term, the program aims to cover all DAO USDC and ETH recipients, setting a policy for future governance distribution.

This is a refinement of a proposal which has been put forward here before (twice). Since the beginning of the year, one of Metagovā€™s goal has beento increase ENS governance participation and delegation. We would like to put this to a social vote at the same time with the incoming Metagov Funding request, but as a separate proposal.

We believe governance distribution increases the access to the DAO governance, which helps the utility of the token, decreases the amount of tokens being purely used in markets, increases delegation and safety of the DAO, while also helping align developers and other people who bring value to the DAO.

Context:

Matching Program:

  • 1:1 ENS match based on the market value at the transaction or voting date
  • ENS value calculated here at $15 per token for the purpose of lower bound for budgeting, value will be adjusted at a time in the future to reflect market
  • Vesting over 3 years using Hedgey for structured distribution

The ENS DAO has given away about 1.4M dollars in the form of grants and sponsorships and other payments, not counting funds sent to ENS LABS, internal DAO Wallets, stewards salaries, and the service providers stream. Our intent would be to make a 1:1 matching in ENS, at the market value of when the day of the transaction is sent (or rather, when itā€™s voted on), with a 3 year vesting using Hedgey.

This proposal is being submitted separately from the Metagovā€™s main funding so each can be discussed by their own merits. Metagov current funding requests is not asking for any additional ENS as the stewards believe this is our proposed program for such distributions.

Example

This means that if you have received any ETH or USDC from any of the outgoing ENS DAO wallets, then the value of transaction is calculated at the time of the transaction was posted. We will add all these transactions from january 1st to september 30th, and then at some point in the near future, request an equivalent ENS (at an exchange rate between 15-20, depending when the budget is requested) from the DAO to the Metagov wallet. We will then redistribute all of that ENS in the form of vested Hedgey contracts, sent to the same address that received the original value. That means the power to vote is granted immediately, but youā€™ll only be able to access the ENS itself over a period of 2 years + 1 year cliff.

We are exempting from this program: ENS Labs, Stewards, Service Providers (since we consider they already received governance ENS), ENS and ETH refunds and any other transactions we might consider did not represent a service provided to ENS (like purchase of merchandises or travel reimbursements).

Distribution Table:

The table below is an estimate from the ENS ledger, excluding Stewards, Service Providers, ENS Labs, refunds, and internal wallets. Table is not final, but a first estimate, any values or recipients could change.

This proposal covers transactions from January 2024 to September 2024, subject to legal review and market adjustments.

The full data, as well as the transaction hashes, can be found in this Google Sheets.

Recipient Category Transaction USD Received USD Total ENS estimate
ImmuneFi* Bug Bounty 2024-06-13 $ 250,000.00
2024-08-29 $ 100,000.00 $ 350,000.00 23,333.33
ETHGlobal* Hackathons 2024-01-29 $ 240,000.00 $ 240,000.00 16,000.00
Rotki PG Large Grants 2024-05-21 $ 30,000.00
2024-09-04 $ 12,500.00
PG Small Grants 2024-05-29 $ 940.56
2024-06-20 $ 10,532.82 $ 53,973.38 3,598.23
wslyvh.eth Hackathons 2024-05-20 $ 50,004.00 $ 50,004.00 3,333.60
gashawk.eth PG Large Grants 2024-02-02 $ 30,000.00
2024-08-29 $ 10,000.00 $ 40,000.00 2,666.67
buidlguidl.eth PG Large Grants 2024-09-09 $ 15,000.00
2024-09-10 $ 10,000.00
2024-09-10 $ 5,000.00
2024-09-10 $ 5,000.00 $ 35,000.00 2,333.33
borderlessafrica.eth PG Large Grants 2024-08-30 $ 10,000.00
2024-08-30 $ 20,000.00 $ 30,000.00 2,000.00
daemon.eth Salaries 2024-01-31 $ 3,000.00
2024-02-29 $ 3,000.00
2024-03-31 $ 3,000.00
2024-04-30 $ 3,000.00
2024-05-31 $ 3,000.00
2024-06-30 $ 3,000.00
2024-07-31 $ 3,000.00
2024-08-31 $ 3,000.00
2024-09-30 $ 3,000.00 $ 27,000.00 1,800.00
Revoke.Cash PG Large Grants 2024-01-19 $ 5,000.00
2024-05-14 $ 20,000.00 $ 25,000.00 1,666.67
Onthis Eco. Grants 2024-03-31 $ 25,000.00 $ 25,000.00 1,666.67
ipns.eth Eco. Grants 2024-04-14 $ 25,000.00 $ 25,000.00 1,666.67
Fluidkey Eco. Grants 2024-03-31 $ 25,000.00 $ 25,000.00 1,666.67
Blockscout Eco. Grants 2024-09-05 $ 25,000.00 $ 25,000.00 1,666.67
beaconchain.eth Eco. Grants 2024-03-31 $ 25,000.00 $ 25,000.00 1,666.67
1w3.eth Eco. Grants 2024-03-31 $ 25,000.00 $ 25,000.00 1,666.67
Firefly PG Large Grants 2024-09-24 $ 20,000.00 $ 20,000.00 1,333.33
EIP-7212 PG Large Grants 2024-04-25 $ 20,000.00 $ 20,000.00 1,333.33
Urbe Campus Hackathons 2024-06-13 $ 14,680.00
PG Large Grants 2024-09-04 $ 5,000.00 $ 19,680.00 1,312.00
ethdaily.eth PG Small Grants 2024-05-29 $ 11,286.66
2024-06-20 $ 3,510.94 $ 14,797.60 986.51
Discord Support Support 2024-01-31 $ 1,500.00
2024-03-02 $ 1,500.00
2024-04-02 $ 1,500.00
2024-04-30 $ 1,700.00
2024-06-02 $ 1,700.00
2024-07-01 $ 1,700.00
2024-08-05 $ 1,700.00
2024-09-04 $ 1,700.00 $ 13,000.00 866.67
Dappnode PG Large Grants 2024-05-14 $ 12,500.00 $ 12,500.00 833.33
generalmagic.eth Merch 2024-01-12 $ 1,000.00
2024-01-12 $ 1,000.00
2024-02-27 $ 5,413.43
2024-03-09 $ 2,150.00
2024-05-01 $ 1,000.00
2024-05-17 $ 1,000.00 $ 11,563.43 770.90
Pugson Eco. Grants 2024-03-31 $ 10,000.00 $ 10,000.00 666.67
Juicebox Eco. Grants 2024-09-12 $ 10,000.00 $ 10,000.00 666.67
frolic.eth Eco. Grants 2024-03-31 $ 10,000.00 $ 10,000.00 666.67
ETHDenver PG Hackathons 2024-02-22 $ 10,000.00 $ 10,000.00 666.67
Drips Eco. Grants 2024-04-18 $ 100.00
2024-04-18 $ 9,900.00 $ 10,000.00 666.67
Lemma Bylaws 2024-02-06 $ 2,498.67
2024-03-15 $ 5,000.00
DAO Bylaws 2024-05-18 $ 2,500.00 $ 9,998.67 666.58
Tally DAO Tooling 2024-03-27 $ 8,999.54 $ 8,999.54 599.97
pairwise.eth PG Small Grants 2024-05-29 $ 7,524.44
2024-06-20 $ 877.74 $ 8,402.18 560.15
apoorv.eth PG Small Grants 2024-06-20 $ 7,021.88 $ 7,021.88 468.13
leticiaferraz.eth Articles 2024-01-08 $ 350.00
2024-01-31 $ 1,000.62
2024-07-30 $ 2,898.70
2024-09-04 $ 2,700.00 $ 6,949.32 463.29
Socket Gitcoin Grants 2024-05-20 $ 4,900.00
2024-05-20 $ 100.00 $ 5,000.00 333.33
Latin Hackathon Event 2024-05-21 $ 5,000.00 $ 5,000.00 333.33
eth-mexico.eth Event 2024-07-24 $ 5,000.00 $ 5,000.00 333.33
aynieducativo.eth PG Large Grants 2024-05-14 $ 5,000.00 $ 5,000.00 333.33
ENS Fairy ENS Fairy 2024-09-28 $ 4,781.34 $ 4,781.34 318.76
glodollar.eth PG Small Grants 2024-05-29 $ 3,762.22 $ 3,762.22 250.81
weird3.eth IRL 2024-03-25 $ 3,000.00 $ 3,000.00 200.00
Event Support Event 2024-03-05 $ 3,000.00 $ 3,000.00 200.00
daveytea.eth AI 2024-06-05 $ 1,000.00
PG Small Grants 2024-05-29 $ 940.56
2024-06-20 $ 877.74 $ 2,818.29 187.89
stephancill.eth Mini Grants 2024-09-05 $ 2,367.89 $ 2,367.89 157.86
Scope.sh Mini Grants 2024-09-05 $ 2,367.89 $ 2,367.89 157.86
Kiwi News Mini Grants 2024-09-05 $ 2,367.89 $ 2,367.89 157.86
bloomnetwork.eth PG Small Grants 2024-05-29 $ 1,881.11 $ 1,881.11 125.41
modularcrypto.eth PG Small Grants 2024-05-29 $ 940.56
2024-06-20 $ 877.74 $ 1,818.29 121.22
aexek.eth IRL 2024-03-01 $ 1,750.00 $ 1,750.00 116.67
illuminated.eth PG Small Grants 2024-05-29 $ 940.56 $ 940.56 62.70
dhive.eth PG Small Grants 2024-05-29 $ 940.56 $ 940.56 62.70
pabl0cks.eth PG Small Grants 2024-06-20 $ 877.74 $ 877.74 58.52
iviangita.eth PG Small Grants 2024-06-20 $ 877.74 $ 877.74 58.52
easlabs.eth PG Small Grants 2024-06-20 $ 877.74 $ 877.74 58.52
2118.eth PG Small Grants 2024-06-20 $ 877.74 $ 877.74 58.52
andrewpage.eth DAO Tooling 2024-02-06 $ 780.00 $ 780.00 52.00
Total $1,259,976.97 83,998.46

*ImmuneFi and ETHGlobal are third parties who give prizes to hackathon winners and Bounty Discoverers and would be dealt separately with the intent of distributing ENS to these developers

9 Likes
2

Love the idea of distributing governance power (ENS tokens) to eligible recipients, however think a 1:1 matching is too high for an initial pilot imo, and creates expectation and perverse incentive to future contributors.

We have a real need to distribute governance power, and looking at previous USDC/ETH distributions is an excellent metric based on passed ENS contribution, iā€™d propose an ratio of 0.25:1, 0.33:1 or 0.5:1, still giving USDC/ETH recipients a good amount of governance power (proportional to the amount of value theyā€™ve received) without over incentivising these groups for no reason.

Distributing at a 1:1 ratio might be an end state of this program based on learnings of who should be included, timelines, etc. But as a pilot program, this feels like a high ratio. These organisations have already been paid a USDC/ETH rate that they accepted, doubling this allocation seems like overuse of the treasury.

Thereā€™s also an interesting question around if different organisations should get different ratios; ETHglobal getting $240k because of event sponsorship to high quality hackathons, versus an example like CowSwap (a project with a token themselves) getting $111k of ENS tokens, versus something like ENS Fairy receiving $4781 - compared with individuals receiving $5k-$20k. Iā€™m interested in how we can build a longterm program to reward all organisations with governance power, but such a high ratio on top of an existing grant (doubling it) doesnā€™t seem like a pilot test case.

Overall love the concept though :fire: would be happy with basically any ratio that isnā€™t 1:1! Feels like 0.5:1 is a good middle ground for the first pilot?

3 Likes
3

Fully support the idea of distributing ENS tokens to previous grant recipients with the goal of increasing and further decentralizing governance and hopefully improving participation.

One note here, Iā€™m included in the mix here - thecap.eth. Not sure what for. I received grants (for Namespace) last year and the year before that, but this year, I donā€™t think we or I myself received anything.

Either way, wanted to point that out and mention that Iā€™m the Service Provider and I already received ENS tokens as part of that program, in case this is an oversight or a conflict of some kind.

1 Like
4

Thanks @AvsA for putting this up.

Directionally, Iā€™m in support.

I suggest treating ImmuneFi, CoW Swap, and ETHGlobal differently, along others.

ImmuneFi is a bug bounty program. I support governance distributions to developers who find bugs, but much less so to the organization that administers it, which already charges us.

Similar logic applies ETHGlobal. I can see providing governance distributions to hackers who win hackathons. I am a fan of ETHGlobal and would support them getting more involved with ENS on governance side of things, but would likely require a nuanced approach.

Iā€™m assuming that CoW Swap is on the list because we used their protocol to facilitate some financial transaction. If so, I do not think that warrants ENS governance distributions.

4 Likes
5

Thanks for corrections and clarifications on the list, this why I posted it.

Your name was included because of this transaction from June of this year, of $880 from IRL.eco.wg.ens.eth, which I am not sure what it is about. But being a service provider I will exclude it, that was a mistake on my part, thanks for the correction.

Youā€™re correct, I checked the initial transactions and they are not any grant given to Cow swap but rather times in which Stewards used cowslip to exchange tokens. I will be therefore removing them from the list.

We could contact them and make sure they use these tokens not to themselves but to support the developers who they facilitated through our funds. Hackathons and bug bounties are great ways to find talent.

With the removal of Cowswap, the amount of ENS distributed would be between 65k and 85k (depending on the ENS price), which is similar to the amounts distributed to stewards and service providers, both much smaller groups. Thereā€™s an argument that can be made that this is proof that there was too much ENS being distributed to these other groups, but I think it would be a good balance.

When I put this for a social proposal, Iā€™d be willing to put the ratio to a vote: is it 1:1, 1:0.5, 1:0.25 or simply 0?

2 Likes
6

Just remembered - reimbursement for the ENS x Chainlink event we hosted during ETH Belgrade, together with Blockful. Sorry for the confusion. Totally slipped my mind.

3 Likes
7

This is a great idea. Here are 2 cents from a grantee perspective:

  • Borderless Africa is already considering participating in governance, so this proposal is timely + aligned.
  • The goal of ā€œbootstrappingā€ the initial participation with a lock-up is smart.
  • To achieve the long-term purpose of governance participation, we suggest coming up with a total ENS amount to allocate to this. Then allocate 50% of that as a distribution now with the same vesting schedule above, and the remaining 50% to double down on the grantees who are active in governance. This way you manage risk and build long-term alignment.
  • Looking at the massive range, another recommendation is to have a floor and a ceiling of ENS token distributions. An example is 75-100 minimum distribution, and 2500-3000 upper cap.
4 Likes
8

This is an interesting data point. Payments that are reimbursements probably shouldnā€™t qualify for this.
For instance, if the venue had cost 8k or even 80k instead of 800, that wouldnā€™t be something the DAO should reward Cap for with $ENS.

We might need to establish some uniform criteria for qualification, if only to avoid subjective decisions that could be seen as biased.

2 Likes
9

Correct me if Iā€™m wrong but if the criteria has already been established and itā€™s based on the grants received in the past, then subjective decision making was already on the working groups because they chose who gets to receive those grants.

One uniform criteria for qualification is tough to create (other than what we already have) and Iā€™m personally fine with it. Itā€™s inclusive, effective and simple enough to get the job done.

But itā€™s really tricky if you want to go into details. For example, in my case, someone couldā€™ve organized an event for ENS in New York and Chiang Mai and those wouldā€™ve cost a lot more/less than the one I hosted in Serbia. So for the same amount of work, impact, number of attendees, etc., three people would receive different token allocations.

Maybe we distribute tokens based on positive impact and contributions to ENS? In that case, weā€™d need a framework deciding for what constitutes positive impact and how the impact is measured. For Service Providers this was nicely defined and itā€™s really effective.

What makes this difficult is that we are trying to define how to best allocate tokens to a very diverse set of projects. Fluidkey, 1w3, and some others, use ENS as a core infrastructure piece without which their products cannot function. ETHGlobal are events that give ENS exposure and where we host hackathons. ImmuneFi is used for bug bounties, etc. all equally important.

Iā€™m fine with Metagov working group having a degree of subjective decision-making as long as itā€™s in the best interest of ENS. But ideally, yes, we find a way to do this based on a predefined set of qualifying points. Concern there is a lot of added overhead and too much complexity.

Again, what we have now is simple and effective enough for me. Just sharing my thoughts for future consideration and iterations.

One other thing - Iā€™ve only recently found out that, to my surprise, a lot of DAOs give tokens every month to top 20, 30, 50 most active delegates to increase/keep delegate participation. If we exclude Labs, Stewards, and Service providers from that program, we could get more delegates to actively participate (existing and new). And the qualifying criteria can be similar to this - grants received in the past for example. Maybe something to consider in the future even though Iā€™m still on the fence about this one. Maybe worthy of a separate discussion.

10

This feels like it could serve as an anchor for a separate conversation as the program evolves. KPIs, OKRs, and similar frameworks have been on my mind since last year, but they would require significant input from key decision-makers.

1 Like
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I believe that a big appeal of this pilot program is precisely the fact that it assumes the measure of impact and decision to fund was already made by some group of stewards or other manners of voting (like the small grants) and therefore we just rewards based on that.

I have removed all reimbursements I detected, but I suppose wed have to further comb down the list to make sure what is being rewarded is correct.

2 Likes
12

Amazing. Looking forward to seeing that. Happy to help in any way I can when you start working on this.

I agree. All great projects above.

1 Like
13

Thatā€™s a good point. In theory, eligibility for ENS Matching can be determined in two main ways: 1) Steward discretion used to allocate USDC/ETH funding, and 2) Community voting for Small Grants and other programs.

To provide more clarity, it might be helpful to outline how each recipient became eligible for the proposed distribution. For example, some recipients received Large Grants through steward discretion, while others were awarded Small Grants via community voting. The ENS Matching is then based on these funding decisions. Obviously, this is an oversimplification, but you get the gist of it.

This seems like a straightforward framework that could be iterated upon and refined.

14

Thanks for posting this @AvsA, itā€™s a great initiative to distribute more ENS to folks who somehow contributed or were evaluated as having a positive impact by stewards.

I agree with that. How can we ensure these tokens get into the hands of the builders/white hackers and do not stay in the wallets of those organizations? Maybe we can request the wallets to send it directly? Or a formal agreement with the organization.

Most of the entities on the list are not engaged in governance, which brings me concerns about only serving as a bonus. A rate closer to what was distributed to the service providers looks like a good experiment to understand how much this will raise delegation and bring engagement to governance.

2 Likes
15

A counterpoint is that entities on the list may have hitherto not engaged in governance due to the absence of a governance distribution framework.

The vesting contract acts as a safeguard, encouraging long-term alignment by distributing governance rewards gradually rather than immediately.

While recipients may still view the Governance Distribution Pilot as a bonus, we can promote sustained participation by setting examples that show the value of long-term involvement.

I understand the concerns nonetheless.

1 Like
16

Great to see this ā€œin the wildā€ - definitely needed and a great move forward in distributing gov power. As per many comments so far, an experimentation with lower ratio for the pilot would be good and a set timeline for the experiment laid out - say six months.

At the end of pilot, a learnings report can be produced by MG WG looking at parameteres such as engagement, proactive participation (discussion, voting etc.) for the selected delegates in the set time frame.

Experimentation is the name of the game here as governance is not something everyone has the appetite, resource and attention span to participate in so a solid model for intention signalling, buy in, contribution tiers etc. can come as a result of the pilot and its learnings. We have seen plenty of orgs holding significant power and sometimes creating blockers through their inactivity in the governance processes across the ecosystem.

All in all a good move but would urge a bit more clarity around timelines and measurable markers to be put in place.

1 Like
17

Iā€™m broadly supportive of this! Iā€™d like to see more ENS tokens distributed to aligned actors who are likely to participate in governance.

The ImmuneFi and ETHGlobal distributions seem like they would fall under the ā€œpurchseā€ exclusion to me.

Meaning no disrespect, itā€™s a bit dismaying that the third largest amount, of over $100k, didnā€™t get any basic due diligence to check the reason for the payment or whether it should qualify for a governance incentive before posting.

In the cases of ImmuneFi and CowSwap, there may be eventual recipients who should qualify - bounty recipients and grant recipients - who arenā€™t present on this list.

4 Likes
18

That should be ā€œnamesys.ethā€. Weā€™re holding ipns.eth for our *.ipns.eth gateways & pinning/republishing service.

1w3.eth since rebranded to webhash.eth

I guess this is @ricmooā€™s $5 firefly.eth h/w wallet? Or Firefly multi-social app from Maskbook?

19

It is indeed firefly.eth wallet - they are a recipient of the Public Goods WG run Large Grants alongside a few others on the list like Rotki, gashawk.eth, buildlguidl.eth, Urbe Campus, borderlessafrica.eth etc.

2 Likes
20

I think it would be great to implement a tiered system with minimum and maximum distributions. This way, everyone feels their efforts are valued while also encouraging higher levels of participation that benefit the DAO as a whole.

Motivating individual members and promoting equality within our community is important, especially since it takes time and effort to stay updated, participate in discussions, and make time for meetings for the entire duration of the matching program.

With that in mind, since the goal is to increase governance participation, the distribution should be tied to some criteria that need to be met in order to receive it.

The numbers and criteria are just examples and can be tweaked, but hereā€™s an idea to illustrate the system:

  1. Basic Tier: Minimum participation requirements.
  • Criteria: Attend at least 25% of governance meetings and vote on at least 50% of proposals.
  • Distribution: 500 tokens (minimum allocation)
  1. Intermediate Tier: For members exceeding basic requirements.
  • Criteria: Attend at least 50% of meetings and vote on at least 75% of proposals, and contribute to discussions.
  • Distribution: 1,000 tokens
  1. Advanced Tier: For high-level contributors.
  • Criteria: Attend at least 50% of meetings and vote on at least 80% of proposals, contribute to discussions, and submit proposals.
  • Distribution: 1,750 tokens (maximum allocation)

The criteria should be clear, reviewed periodically, and quantifiable to ensure everythingā€™s transparent.

TL;DR:

  • The tiered system rewards members based on their level of participation, so those who contribute more receive more tokens, but within reasonable limits. This balance ensures that extra effort is acknowledged.
  • Caps on distributions help keep the total token distribution within the DAOā€™s budget. For example, even if everyone qualifies for the advanced tier (which is great!), the total tokens distributed remain manageable (e.g., 60 members * 1,750 ens = 105,000 ens).
  • Knowing thereā€™s both a meaningful minimum reward and an opportunity to earn more encourages members to stay engaged and possibly increase their involvement over time.

Disclaimer: Just so you know, Iā€™m involved with one of the projects that might benefit from this governance distribution program which might influence my perspective, so please consider other viewpoints as well.

3 Likes