Absolutely agree on streamlining the process of going from a regular pool to being whitelisted and having co-investment (plus LM rewards if that community has good volume e.g. pool race will now do this). I have been listening on the community calls and I think that Bancor folks do see this as a barrier to entry. I get the sense that with origin pools, that they are looking at removing this barrier by potentially having projects start via the origin system and gradually upgrade them as they meet our goals/guidelines. This would require less involvement from the DAO since the process would kind of be automated to an extend but obviously a project should still be able to bypass the early stages via our existing mechanisms.
I think that the community has been burned (me included) in the past few voting cycles by missing some good projects due to us not reaching quorum on whitelisting proposals. This discussion seems to be a very popular topic and I expect at least two proposals (if not more) to come out of this (incentivizing voting and how to maintain active voters in the staking contract). The point that I was trying to make was that the former should easily pass with community support (I donât think vBNT holders would vote against it) and implementing that via some airdrop mechanism should be easily done. The latter would require a non trivial amount of time investment from Bancor devs and given current priorities (which I am not privy too) might not see a solution deployed to mainnet in the close future (contracts might have to be tested, audited, etcâŚ). Hence, why I alluded to the community taking up the first option (which also seems to be the emerging consensus) as that might be able to alleviate some of the friction we are seeing in a relatively quick manner.
One important thing to note with the launch of xBNT this week is that xToken will now have voting power in our DAO. This means that they would most likely consistently vote on all proposals going forward following the guidelines that they have set (see mandated governance).
A quick look at the governance contract shows that the xBNTa contract has already locked up 750K vBNT for voting. This is large chunk of vBNT that they have been able lock in a small amount of time (launch was this week). It will be interesting to see how xToken exercises their voting power in future proposals.
Tying vBNT to voting power goes two ways, I think. a) vBNT holder who chooses governance over leveraging vBNT is ipso facto an engaged party who is interested in governance (which is good) and b) a vBNT holder who chooses governance over leverage may be more risk-averse than the vBNT holder who trades it away (IMO good).
I donât have data but itâs my understanding that a significant amount of vBNT staked in governance has never voted. If we kick those tokens back to their wallets, we can achieve more consistent quorums. If we literally only did this it might solve our issues.
+1
To me this seems like the case of âlow hanging fruitâ versus âideal governanceâ.
First proposal: low hanging fruit of kicking inactive voters (which is like running for town council and then never showing up to a meeting, not acceptable in any government) and a basic static BNT airdrop once-a-month-compensation for voting (details TBD, and understanding that airdrops are gas intensive).
(Actual useful idea: BNT voting rewards are added votersâ unclaimed stake rewards, since if you have vBNT you are very likely to have a stake and this shifts airdrop gas cost to the voter. Importantly, this also deters potential duplicate wallet exploits since youâd need to pay governance gas AND withdrawal gas on each wallet just to game the system.)
Potential second proposal if need: ideal governance with things like the ballot page, re-weighting votes, vote delegation, voting contests/gamification/advanced voting reward schemes that need testing. Things that require a lot of dev energy that are also hard to agree on.
Good info. Between xBNT and kicking people, I believe we could solve our quorum issue. However, I am in favor of a rewards scheme too because I donât want to be beholden to an ever-increasing super wallet. It doesnât take much imagination to see a 3m+ xBNT wallet unilaterally deciding votes in a few months.
If quorum is only based on vBNT staked for voting, that is really good and eliminates the concern of the vBNT Vortex. Unstaking vBNT that isnât actively voting is another great idea to keep governance active and quorum being met. Not sure how that would be executed, but that is why you guys exist. LOL
As far as a large token holder creating a massive number of wallets to control governance, that seems like a self defeating exercise that simply would take way to much time and work if your groups votes based on blocks of vBNT. Today they already control the vote with the qty of vBNT they hold, so making such voting weight more troublesome, seems to me, would only improve the process. But I could be missing something in this thought process.
Either way, great discussion for a real issue that is keeping some incredible pools and such from coming online.
I poked around Nexus Mutual governance to get an idea of what they pay. NM doesnât incentivize every vote but when they do it is 100 NXM to be split evenly between the unique addresses that vote (not weighted). 100 NXM has ranged between $2,000 and $10,000 USD since they started this program. Of their past 33 votes, 12 have been incentivized with 100 NXM. Itâs hard to tell what time period this is over but based on forum posts I think itâs over a 6-7 month period.
Iâm not sure what our rewards appetite should be but a mid-cap LM token getâs 10,000-20,000 BNT per week which is in the ballpark of $65k-$130k USD per week. This would be an order of magnitude more money than NXM gives out for voting. And Bancor (due to whitelisting/LM) votes way more than NXM does. If anyone has any opinions or math behind hard compensation numbers for voting, Iâd be interested.
Just to throw out a number, maybe 200 BNT for whitelisting, 100 BNT for other votes, divided among unique addresses? This assumes the idea of sending voting rewards directly into staking rewards works and would discourage multiwallet abuse.
I like the way youâve broken it down into two categories. The first proposal is simple and elegant: foster the protocolâs growth by rewarding active participation and eliminating dead weight.
I believe that the ballot page remains an excellent idea for ease of use and voting efficiency alone, but the remaining ideas may not be necessary if the first proposal achieves the goal of increased voter turnout.
I view xBNTa similar to vote delegation, which will increase the total number of vBNT voted, but will reduce the number of wallets voting and may end up muting dissenting opinions. Hence my insistence that we should focus on increasing voter turnout to get the most diverse set of opinions for any decision to be made.
Absolutely. Participation is the goal, regardless of the vote itself. Votes AGAINST could end up protecting the protocol from exposure to a project that turns out to be nefarious while those who voted IN FAVOR couldnât (or wouldnât) see the potential risk(s).
I suggest we take a look at the # of proposals per week or month to come up with a reasonable amount of BNT to use as voting rewards. I think we should have a flat voting rewards structure because our goal should be increased voter turnout for every vote, not just for important proposals because important may be subjective.
OK, I think this is better than airdropping and would shift the focus of claiming voting rewards to the end user. The only problem with this is that the possibility of being a vBNT holder and having stake vBNT in the governance contract without having any active positions does exist (e.g. speculating that vBNT = BNT in the future and outside speculators might have bought tokens at a cheap price now. While waiting, they stake their vBNT in the governance contract to get rewards for voting). The only tweak that we would have to do is to accumulate the rewards separately (not rewards wallet) and let the users claim at their leisure.
Both good and I also leans towards looking at # of proposals per week as @Jefe-fintechv1 alludes to (we already have a cadence that voting happens on Monday). Perhaps the rewards can be based on the number of proposals that are live for a specific week? A quick example, if we have < 5 proposals then we set aside ~300 BNT for rewards (roughly $2000 assuming BNT price of $7). If we have 5-10 proposals then we set aside ~600 BNT etc⌠Distribution can be as simple as:
((Number of proposals you voted for) / (Total number of votes across all proposals)) * BNT set aside for that week
I still like the ballot page idea for my ideal voting experience. My concerns are several. To start, that it might not be possible with how Snapshot works, or itâs really labor intensive, or that only Snapshot team can do it. Itâs not a current feature for them, and I saw that our own @tenzent has an outstanding feature request in Snapshot from early March to simply see the current vote count from the proposal landing page. Itâs unfortunate because Banacor legacy governance had these features which we lost when migrating to Snapshot.
Iâm also worried that voters might not give the attention each proposal deserves if they can scan over them. LM Reward votes draw those interested in their token. BIPs always draw everyone. Whitelists however are both frequent and require a lot of scrutiny. When we put voting rewards into the mix, I worry that the âgreedy voterâ will just react to the token name and snap vote with even reading the proposal.
We have to find out if this âstakedropâ idea is even possible but it really does feel like a perfect solution. If the fatal flaw in that idea is vBNT-only holders missing out, Iâm okay with that. a) They have a totally speculative position that does not help the protocol (not LPing). I say this as someone who is heavy vBNT speculatively. And b) What else are they gonna do? Sell? LP in Balancer (doesnât help us). Weâre trying to attract BNT non-whales to governance with bribes. How many vBNT-only non-whales are there really? And all they need to do to collect rewards is have any BNT stake, however small. (edit: really they just need to have any staking position at all, even non BNT).
I consider whitelistings to be the most important votes since they are the gatekeepers to protocol growth and crucial to protocol health. I think this is reflected in the quorum requirements. That said Iâm not opposed to a flat structure. In general, the flatter everything is the easier it will be to understand the data and make changes.
Since Snapshot was introduced, weâve had five blocks (weeks) of voting. Weâve had 52 proposals over that time (and 32 of them whitelistings), so roughly 10 votes per week.
Before Snapshot we had 57 votes over 15 weeks, so about 4 votes per week. (Snapshot has really helped the DAO!).
I would say that 10+ votes per week is fair (and expecting that to grow as Bancor grows).
This is an interesting thought process. Scaling systems are hard to predict but we can always go back and change it. Are we still tied to proportional rewards? I really feel like a simple (Proposal Reward / Unique Addresses) for each proposal would work. I was originally thinking something like:
200 BNT per proposal â´ ~2000 BNT a block â´ ~8000 BNT a month â´ ~$56k USD per month on voting rewards at current prices.
I donât know what an appropriate amount is but in the context of a 2 billion dollar protocol that doesnât seem too bad. Maybe tweak down?
Also I anticipated this program functioning until the end of LM rewards at which time we come back and decide if we still need it.
Fair point. Delivery of the ballot feature seems to be out of our control. We can add it to the nice to have list.
I would actually think of how to determine the reward amount in terms of total fees earned by the protocol, or perhaps against the market cap of BNT or vBNT instead of against the protocolâs TVL.
There is a sizeable amount of vBNT holders outside of the governance contract at the moment. Some of these individuals could be LPs in Bancor or have acquire vBNT for speculative reasons. There is also the possibility that they might have acquired vBNT to have more voting power in the DAO (could be important in the future, who knows). If we can come up with a solution that doesnât exclude these folks by accumulating voting rewards in a separate wallet (not the rewards wallet for LPs) then I think it is fair for us to do that (perhaps you collect your voting rewards from the âvoteâ page in the Bancor app just like you stake from there as well).
In my opinion, if we keep it simple then the implementation would be easier. We incentivize voting in general as we want greater participation and treat all voting rounds equally. The amount of BNT being set aside for rewards for that week based on the amount of proposals that are being voted on.
Yes, I think we tweak down. As to whatâs an appropriate range, I think somewhere between $2500-$15K (thatâs roughly ~2100 BNT Max assuming price of $7) per month. The proposal that comes out of this process should have a fixed term (3, 6, 9 , 12 months etcâŚ) set with the DAO having the capability to renew the program any number of times.
What if we built a ballot system and made one vote a month with the ballot? That would probably save a lot of gas, especially if we used gas tokens. Doing rewards in one massive block makes things easier to calculate for, I think. We could consider the idea of using Sablier (compounding?) streams to distribute rewards; you participate in a vote and when you do that your reward stream is started and runs its course over the month.
The Sablier protocol doesnât appear to have a wide range of tokens available, and notably all of our native tokens are absent. There are two options to deal with this:
We can contribute to the Sablier protocol somehow and get BNT/vBNT added to the protocol, and also potentially get a stake of COMP and influence Compound Governance to add BNT/vBNT to the protocol so we can run compounding streams natively.
We can automatically swap to a highly liquid asset (with a good rate on Compound if we go that route) when we initiate the reward stream, and when the holder autostakes/withdraws their rewards, we just swap it back, all via our web interface.
I want to see a large %, say 80% or more, hit quorum regardless of whether the proposal passes or not. When I started this thread, my objective was to discuss ideas to increase voter turnout and participation in governance. I believe the more often we achieve quorum the results will be either passing more proposals or gaining valuable intelligence regarding why a proposal didnât pass that could be shared within our community or with other communities to improve or abandon the proposal. Failure to pass due to not hitting quorum provides us little information.
The idea of a ballot is being explored but mostly for convenience. I think that the current cadence of voting is healthy speed is always a factor. I would hate to have a project come to Bancor, try to get whitelisted, just to wait a month to find theyâve been rejected or their proposal failed quorum. That may hurt Bancorâs reputation.
Interesting idea. I wonder how difficult it would be to get BNT added to their platform. I feel confident that voting rewards would need to be paid in BNT.
This is the perfect summary of my thoughts. If a proposal makes quorum but fails, this is a rejection of those ideas and it can lead to more discussion. In the case of a whitelisting, a quorum of Against means âWe think this token is not good for Bancor (right now, ever, without changes)â. If a whitelist fails but doesnât make quorum, does this mean that there is a lack of interest? Could more interest be drummed up? Is it an outright rejection on security grounds? Do you just try again harder (as in the case of DIP)? Consistent quorums are more useful to everyone.
Now that Iâve thought about it more, I agree; we could still do a month-duration reward stream, that way you have a sort of âcascadeâ of rewards. Effectively, itâd be similar to the weekly multiplier on LM rewards; as long as you vote every week, you maintain maximum flow. This incentivizes consistent participation.
Yup, just echoing @bias previous statement. We need governance to move quickly (more so in crypto where the pace is already accelerated) and we would put ourselves in a significant disadvantage if we switch to a monthly cadence (it would significantly hurt the DAO in getting things done). FYI, I still expect for emergency proposals to be voted on outside of our regular cadence if there is an urgent need (e.g. emergency delisting of a token that might have an infinite printing bug).
What are the advantages of using Sablier as opposed to us distributing the rewards? With the idea being that we are not looking to do an airdrop but rather deposit the voting rewards in a wallet where the user will collect them (and potentially providing the ability to stake those voting rewards directly into our platform)? This would be similar to how you claim your BNT liquidity mining rewards at the moment.
One other thing that we should be cognizant about is that whatever solution we proposed will need to have development time dedicated and the more complex the solution is the longer it will take for it to be implemented.
Itâs not an airdrop, itâs a way to ensure that rewards are distributed directly to the holder in a controlled manner, while potentially making revenue for the protocol and simultaneously offloading the development/maintenance work of that functionality on to the Sablier team.
The website doesnât have too much in the way of explanation. If itâs built on ETH but isnât an airdrop then users must pay gas to claim? Can you expand on how it could make revenue for the protocol? I like that we could potentially offload effort.
This is exactly correct. A balance accumulates at a constant rate, and at any time the user may withdraw up to the balance. I donât think we should plan around gas costs, since ETH2 should drive them down to negligible, but if we wanted to mitigate them in the short term, thereâs always the aforementioned gas tokens; they could potentially prove useful even after ETH2 goes live.
Of course.
Compounding streams use the Compound protocol to leverage a technical aspect of how the system actually works to accrue interest on the stream. The stream is deposited as a lump sum, and the portion that the user is permitted to withdraw is increased as a function of time elapsed out of the stream duration set during initialization. The deposit is put into Compound, and is drawn from as the user withdraws their balance.
Not exclusive to compounding streams: At the end of the stream, whatever balance remains is transferred to the recipient; if the sender cancels (which they may do unconditionally), the âstreamedâ portion of the deposit is sent to the recipient and the âunstreamedâ portion is returned to the sender.
The interest accrued can be split between multiple parties, if Iâm not mistaken, but it can at least be directed to an arbitrary address.
The obvious consequences of this are that itâs best not to withdraw from your stream and let it run its course untouched if you are getting a portion (if not all) the interest. Which, in the context of voting incentives, leaves us with exactly one choice; the staker must be given a portion of the interest in order to reward them for their patience, but to support the protocol a portion must go to the DAO.
Itâs a mutually beneficial relationship: the patient, considerate, consistent voters will get the greatest rewards by default; Compound gets a supply of capital in the form of BNT (assuming they whitelist it); and we get revenue, and higher quality governance.
Yes, I see. My comment about the airdrop was in relation to previous ideas in this thread about voting rewards being airdrop (nothing to do with how sabier distributes funds) but I think we have shifted that to rewards being claimed by the user instead. This will give us some advantages:
Discourages splitting vBNT across multiple wallets (since you are paying fees to stake and to claim)
Some potential integration with letting you restake your rewards directly into Bancor (we get to lock that liquidity directly into the platform)
Potentially integrating with your ârewardsâ wallet so that if you do withdraw then you could lose your multiplier on BNT rewards
I think this is a great platform for the specific use case of paying project contributors in a controlled manner. I am not sure itâs best suited to what we are looking to accomplish (voter incentives) but would love to hear other members opinion to see if this make sense? As you touch, there could be some potential snags with Sabier in that it lends out the funds to compound (for which BNT is not acceptable form of collateral yet) until they are ready to be claimed. Even if we could opt out of that, I am not sure the advantages trump keeping voter incentives rewards in Bancor. (for reasons above) Note that the Bancor team is working on boarding BNT as a form of collateral on Maker and Aave (my guess is that compound would come after).