GZIl DAO Treasury and Raising SSN fees minimum to 5%


This proposal seeks to implement a Gzil treasury and raise the minimum for SSN fees.


This proposal seeks to implement a Gzil treasury funded by a 10% allocation from fees collected by SSNs. Simultaneously, the minimum SSN fee should be raised to 5% to mitigate strain on SSN operators.


**The motivation behind this proposal stems from the observation that participation in governance votes within the Zilliqa ecosystem has been lacking, with recent proposals failing to meet the required quorum. The proponents of this proposal believe that the root cause of this issue is the absence of economic incentives to hold the Gzil token. We believe that for effective governance, the GZil token must persistently accrue value from network activity, thereby incentivizing community members to hold the token and to vote on the direction of the network actively. **


An unfunded and ill-equipped governing body can wield no control, it will inevitably be made redundant. By establishing a treasury for Gzil tokens, the proposal seeks to create a DAO incentive structure for governance participation. This taxation of sorts cannot be divorced from the Gzil token’s governance designation. This approach aligns with the belief that having economic stakes and incentives will enhance the level of engagement and enthusiasm among Gzil token holders, allow SSNs to have a pulse on the prevailing sentiments in the community, and thus position themselves to better serve the ecosystem.

The treasury would be funded by a 10% allocation deducted from the SSN fees. By channeling a fraction of the collected fees to the Gzil Treasury, there would be a sustainable source of funding for purchasing Gzil tokens (to be burned), supporting network initiatives, or awarding additional funds to particular SSNs if needed. This mechanism can create a positive feedback loop wherein developers have a signal on what iterations would serve their interests as well as the Zilliqa community.

If this proposal receives the necessary approval, Zilliqa will develop a smart contract implementing the 10% deduction from all SSN fees, and create an interface specifically for displaying the treasury, an d for voting on how treasury funds will be spent on a quarterly cadence.

We believe this proposal is a crucial one in the endeavor to reinvigorate the Zilliqa governing system.


Hi Zilwill, I completely agree with your motivations and your specifications.

I think also that the refund’s method you describe, is the best one that many of us are now beginning to perceive.

This proposal, if voted, will allow our community to take a big step forward, for all the reasons you mentioned and for all the other good reasons that will follow.

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yes I agree there has to be economic incentive to hold gzil.

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Just to say, from Zilliqa’s point of view, that whilst we’ll be happy to facilitate the technical work resulting from votes such as this one, we won’t in general be able to commit development effort to them.

We can merge PRs, update the various websites, and deploy new contracts once they have been audited, but we can’t (necessarily!) commit to writing code as a result of governance votes.

Hello rrw1000, thank you for test clarifications that allow us to better understand the organizational structure of governance.
So if I understood correctly, once a proposal is voted Zilliqa will do everything to facilitate its tests and its necessary support for its integration.
On the other hand, it cannot commit to the financial means, I think, necessary for the development of its computer code and its validation audit.
Is that correct, or can you elaborate further?

As you know and Zil’s organization and ways to end development,

This proposal aims to implement a Gzil treasury and so do you think that this cash flow would support these steps gradually ?

And if so then the question would be how to begin ?

Hi Raphael - that’s correct; we’ll help as far as we can, but we can’t guarantee to commit resources.

I think someone would need to do some calculations to see what the value of this DAO treasury might be and how much you would want to spend to get the relevant s/w written; I think I’m probably not that well placed to do that.

If I were to do this, I’d probably:

  • Generate a Zilliqa DAO (you could do this using an EVM DAO generator (I did find a good one back in the day, but embarrassingly have now lost the link!) with appropriate parameters - “appropriate” being kind of up to you! But those should be in the formal governance proposal so that we can ensure that a quorum of gZIL holders sign up to them, as should the holders of any associated owner wallets.

  • Write some code in the staking contract to collect the fees (which would then flow to the DAO treasury account)

After that, it’s up to the proposal how much web prettiness you put in front of that DAO contract.
The staking contracts mods for collecting the fees don’t look that hard, but the details of the rest of the DAO/treasury structure and whatever UI you might want for voting might be.

We’d be happy to host voting on snapshot if you can give us a token description (IIRR it’s a json and a bunch of images) and that’s appropriate for your DAO.

From an oversight perspective, I think it would be prudent for the governance proposal, when it comes out, to include details of the proposed DAO contract and how the treasury would be managed, otherwise you are asking gzil holders (and by extension SSNs) to vote to give 10% of their rewards to what is in effect a black box. Though you probably don’t need to fill in all the details at the outset, I don’t think I would be comfortable to support “give 10% of rewards to this account and they will do something good, promise”.

Bear in mind also that we currently have quite a high level of staking reward level, and quite a low set of obligations for SSNs to meet; it seems reasonable to believe that that headroom might reduce in the future, at which point a 10% tax might be more of a big deal than it might be at present.

Hello Richard, thank you very much again for your full answer.

I admit that I still have a hard time synthesizing all the aspects you have developed.

As a tool to generate I saw that there exist “thirdweb” which seems to me both simple and very efficient. Were you thinking about this type of tool to generate a Zilliqa DAO? Or another? Does anyone know of any other tool that might be more appropriate?

I am not a developer, I have been but am no longer, I do not know JavaScript well to write the lines of code necessary to complete all the plug-ins ready offers on this site.

But if I had to, it doesn’t seem impossible. I also think that other people on this forum probably have better skills than I do.

Where I’m having a little trouble seeing is to understand the fee collection mechanism: is it to create this DAO contract, which is basically a EVM or Matic address, and ask the volunteers of this site and elsewhere to transfer there the amount of their choice in the form of a “currency” that we have selected to collect the first fees.

Could this quote be for example the EVM Zil or the Matic Zil? I’m probably not well aware of the full extent of the cryptocurrency universe? Could that be the Gzil as well?

In this case, these first investors would have to recover their investment when the implementation of Gzil’s treasury was successful, probably even with some interest, isn’t it?

And then where I don’t understand very well, is that what you think this prototype DAO contract might later be the tool of treasurer that we want to have? Or would it not be appropriate for a technical or ethical reason?

Please can we clarify these points?

And also start thinking about other points about how the treasurer will be managed ?

Hi Raphael,

Sorry for the wai t…

Re: thirdweb - I was more thinking of sites which will autogenerate your DAO contract for you (maybe thirdweb does that too? only had a quick look), but basically something like that. I guess my main point was that I wouldn’t try writing a DAO contract myself unless I had a simple case and was feeling brave :slight_smile:

No reason you shouldn’t collect donations (subject to legal whatevers) - and no reason they shouldn’t be in any currency you’re prepared to accept; just make sure your contract has the ability to withdraw them again.

I think you’re quite right that the issues you mention (basically, the setup of the DAO) should be specified in the vote - I’m afraid I haven’t any views on this, but I definitely think those in favour of this plan should be chiming in here.

The governance vote might usefully include a txn id and a declaration that if successful, the funds will be managed by “this DAO right here” - that would give voters certainty over what the rules would be should the proposal pass.

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