First of all, I’m excited to see this kind of experimental effort in a DAO. After looking into many DAOs and delegate incentive models, this one feels like the most reasonable so far. Structurally, it’s very similar to Ethereum’s staking rewards model, where stakers receive most of the yield while node operators earn a commission. In this setup, both parties are properly incentivized. It’s good to see delegates being compensated for their efforts as well.
The only issue I see is related to voting frequency. I became a delegate in November, and I’ve encountered only two on-chain votes so far. On-chain votes are infrequent, as they should be. Given that, counting off-chain votes or lowering the 10-vote threshold might be worth considering, since the current structure doesn’t really include or support new delegates outside the existing delegate set.
Finally, delegate incentive caps make sense as a way to avoid centralization. That said, I hope delegators will naturally distribute their stake in a way that promotes decentralization across the delegate set.
This problem doesn’t go away as the amount of delegated tokens increases. Either the DAO reduces its exposure to external assets in its treasury, or it relies on a centralized authority to protect its treasury. I’ve written about this before, but it didn’t seem to get much attention.