This proposal was originally created by user “PolarBear” but due to governance forum “maintenance” did not get any attention. Now with the adjusted quorum and revived interest in governance I would like to put this proposal by “PolarBear” back into consideration. Also edited to include the Poll.
Summary :
To create Gzil DAO with staking mechanism of Gzil. It will require staking Gzil to have share of staking rewards + to make decisions on different proposals.
Abstract:
Current proposal is a preliminary idea of how Gzil DAO could look like.
Gzil DAO as every other DAO will require funding. Funding could be reallocated from rewards that currently flow in zil staking contract.
The idea is to reallocate 10% from current zil staking into Gzil DAO.
The flow that goes into Gzil DAO is divided into 2 parts (50% each):
rewards to Gzil stakers;
decentalized fund.
According to my calculations the above reallocation of rewards will have the following effects:
APR for Gzil staking - floating from 6 to 25% (depending on zil price and share of gzil staked);
decrease in current APR from zil staking - ~ 1,5-2%;
formation of decentralized fund for the year - 36 mln zil.
Decentralized fund could be used according to proposals in different areas (some examples below):
financing of new projects through grants;
building new projects on behalf of Gzil DAO;
support of Gzil price and deapening its liquidity;
funding of trading ideas to increase Gzil fund and motivating successfull ideas with rewards from fund;
building community;
etc.
Motivation:
Idea behind Gzil DAO is:
to create additional Gzil utility in the form of making decisions + getting staking rewards;
to start creating alternative decentralized funding resource for Zilliqa ecosystem;
to brainstorm new ideas and experiment with community;
to increase activity within DEFI zilliqa ecosystem.
I always believe that Governance should be done with good faith and proposals be beneficial and sustainable in the long run for the ecosystem. It should be an avenue to set rules and strategies towards creation of value into the blockchain. First and foremost, I can declare I hold a substantial amount of Gzil, but I have a greater Zil holding.
Based on this proposal, if the intended re-allocation of funds from staking were to be moved to rewarding Gzil stakers, that will ;
A) Erode rewards for People with more Zils than Gzils
B) Benefits mainly the Gzil holders before the Snapshot.
C) Erode Earnings for SSNs who earn by commission from stakers
I’m unable to comprehend how the freed up resources will bring about more developments and value back into the ecosystem. It is akin to taking pre-determined funds promised to the stakers and redistribute to the “executive” board (Gzil holders)
Proposal seems to be missing a lot of parts. Would be better to include (1) how the DAO would be governed and explain the protocols set in place (2) What’s the selection process will be and how the money will be managed, (3) how you came up with the numbers (e.g. the 10%), (4) Whats the point is of giving APR to gZIL stakers, (5) How will the projects be held accountable to not just burn money etc. etc.
Also, how would the 10% be distributed non custodially and who will be developing this solution?
Without proper alignment of incentives to hold Gzil, it cannot perform its governance functions adequately as shown by the inability to meet quorum repeatedly. Just as the downward pressure on staking rewards hindered SSN’s ability to provide beneficial service. Gzil currently seems to exist as an appendage to the ecosystem, until voting proposals are made. This proposal would integrate it by incentivizing non-SSN members of the community to truly participate in the marketplace of influence over the direction of the ecosystem which ultimately makes us stronger by respecting the tenets of decentralization. Yes, the points you mentioned will be necessary to bring this to fruition, but without an empowered Gzil the more concentrated group of SSNs would be the true “executive board” and that’s antithetical to the spirit of the space. SSNs could hedge against potential loss by holding Gzil.
Just as the community was rightfully galvanized to forgo potential short-term profits in the interest of the network’s future and voted to ensure that SSNs are adequately rewarded for their integral role in the ecosystem, I would urge SSNs to adopt a similar ethos in this consideration.
Hello everyone,
I think these are interesting ideas that deserve to be debated in order to better understand the organization of the DAO of Zilliqa, and the means allocated to gZil governance.