Empower the Multisig

Legal advice is very important at this stage.

Lets suppose $YFI gets big. No.3 after BTC and ETH. Possible.

And all those earnings effectively in dollars being distributed to YFI holders.

Starts to look very much like a security.

Should be very careful.

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Agreed. Has been added as proposed budget item.

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@eric_rsno

We can put a time restriction on the foundation, and this can easily only be temporary. I have been apart of many DAO’s for years. I have seen many DAO’s fail to formally organize early and fall flat on their face. The best model for success is an early foundation model of some type, so we can organize for the sake of efficiency and ship products, UI, user experience, etc to market.

The most successful decentralized networks started with a foundation models. For example Synthetix (SNX). They shipped product to market then pushed for further decentralization afterward and it worked with incredible success.

@cryptoyieldinfo

I don’t think we are anywhere near the radar of any government or regulatory agency. VC barely knows we exist. That is why it is important for us to organize ASAP so we can put products to market before any regulators take notice. Once we do pose a serious legal threat, that is when we should push for further decentralization. SNX did this exactly. They wanted to ship sTSLA sAPPL to market but they knew the SEC would get mad about synthetic securities, so they didn’t launch. Instead they became a DAO, and now the community is deciding when to ship those products since now they cannot be stopped.

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My bad, but even if there is no legal entity, it’s still a bad idea.

Working groups with facilitators or leads on different topics is a great way to organize in a decentralized network, and allows everyone to participate, best ideas to bubble up.

As soon as you start assigning roles, salary and creating hierarchy, it will discourage new people from joining, and make it hard to change this structure.

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Probably a better idea to use Kleros court (or other DAO legal platform) to hire contractors to build broad efforts than to actually transition to a Foundation.

I am for. I believe me need to move fast. This goes in the same direction as: Change participants of the multisig wallet. They need to happen together. We need all members of the MultiSig to be active and lean.

A few points to consider:

  • Are all of the multi-sig members known? They may be to some, though not to me
  • It’s possible that Andre chose the multi-sig participants based on their trust-worthiness, and not on their ability (or desire) to make operational decisions. Some may not even hold YFI.
  • An alternative may be to just hire a COO to help take on operational burden and make additional hires (on a contract basis). That person MUST have the full confidence of Andre before he/she is installed in that position. That person would be empowered to spend Treasury money up to a limit (and with full disclosure on how the money is spent), possibly with deeper review from a council of larger YFI holders. If desired, an automated “vote of no confidence” could be executed on that leader on a monthly or bi-monthly basis
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I voted no simply based on the monthly budget of $250K per month; but would love to see @Substreight’s full budget proposal to get a more clear picture.

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I think this is a good idea. The automated “vote of no confidence” gives the community a release valve in case the COO is not working out.

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So create special interest groups (sub-daos?) and pass budgets to each of them to determine how to grant out in best interest of their focus? Protocol, treasury, community, etc…

How do you determine leads without creating authority or centralizing power?

Ultimately, I share your concern. The vision of the proposal is to get to a full-dao model. If anything, this is more to formalize much of the work that is already being done and ‘roles’ that are already being filled. The goal of this is to create a lean transition team that can guide the protocol to a fully-decentralized model in a rather short time frame.

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Determining leads without creating authority or centralizing power?

That’s an unsolvable paradox that cannot be solved, only managed or mitigated. Ultimately, there must be some form of centralization somewhere in the process, especially so at this embryonic stage.

For example, the web servers running yearn.finance may be servers or VM instances in the cloud somewhere, but there’s physical hardware somewhere that may be running Web and Network related Services such as TCP/IP, HTTPS, HTML, IIS, NTP, and SQL. You could set up failovers in remote locations from one another as a mitigation, but the point is those servers or VMs have to be located somewhere in centralized locations drawing power, processing packets, providing read/write access to databases and pools of information, and providing CPU power and RAM to make all this magic happen behind the scene. The alternative to centralized servers is trying to run a distributed world computer, with all the network operating fees, costs, and intrinsic latency that comes along with it.

Regarding the best path forward and trying to nurture and grow this entire protocol and ecosystem, the only logical solution appears to be the one you mentioned: a lean transition team with SMEs as team leads that can guide this protocol and experiment to a truly decentralized DAO.

The team leads will need to be empowered to do their jobs, to be agile, and be able to respond with haste should the situation warrant it. Things move ultrafast in the world of DeFi. The selection of these team leads in their various fields is key, as processes and procedures set up now could become gospel or SOP just out of habit and convenience.

To choose these leaders is a difficult compromise situation where there may be no absolutely perfect candidate that can satisfy everyone, and the selection process itself will have its criticisms, regardless of whether it may be the best solution possible.

At best, this selection process will have meritocracy involved, instead of popularity as a measuring stick for inclusion as a team lead.

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I vote for! We need that to evolve and pursue the vision

I think the title of this post is confusing and actually contrary to the content. A foundation model has far more power than the council proposed.

The proposal is to empower a small council to make and expend operational budgets under a limit imposed by this DAO and only with the continued support of this DAO.

In the foundation models we’ve seen in other DeFi entities they started with all the decision making power and then slowly ceded this to DAOs. That is not what we should do, and not what the content of this proposal suggests.

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More feedback:

Suggestion that the multisig should present budgets on this forum for transparency and to get non-binding advice (using the advice process). Then they can make whatever decisions they want under their purview.

cc @banteg, @Substreight

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After reading and reflecting on a lot of the comments in this thread I spent some time working through them in a new post here: Understanding Decentralization & Prioritizing an Operations Team

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Closing poll and moving to YIP shortly.

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I vote for this proposal to allow continued growth

Attached is the interim 6 month budget (annualized also presented) related to this proposal. We are proposing fixed expenses of approximately $181k per month for six months, in addition to a larger discretionary and contingent $500k rolling bug bounty. Bug bounty expenses won’t necessarily be incurred, but given the size of capital in the contracts a bounty of this size may be more prudent than originally discussed.

Budget also includes a $50k expenditure for a UI/UX revamp to be spent any time in the next 6 months. Also note that half of the proposed monthly budget is directly related to security auditor ($64k) and developer expenses ($37k).

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Yeah, fractalising into sub DAOs is a viable option, but its a process that takes time. You could instead just have working groups, with budgets, and have all decisions passed by the DAO:

  1. Agree on working groups with budgets, approve this by the DAO
  2. Create working groups with facilitators
  3. Hold series of calls, bubble up efforts and initiatives, prioritize and report
  4. Submit funding requests to the DAO for vote

Less “Leads” and more “Facilitators” to prevent a central authority. Everything should still be passed by the DAO.

I do agree that having a transition team will help make things go quicker, but it also has the potential to do a lot of harm. Slippery slope.

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Promoted to YIP 41:

1 Like