Thought Contributor Rewards Pool

Summary:

Re-direct a small percentage of fees that are currently distributed to YFI stakers to a Thought Contributor Pool, via tallying of staked YFI on posts.

Abstract:

YFI tokens staked in Governance translates to a token balance within a platform similar to this one we are currently using, but with additional functionality built in, as described below. Note, the token balance could either be denominated directly in YFI or some new asset correlated to the value of YFI staked (there may be pros and cons to either option). This token can then be staked to posted content contributed by other users on the platform, and then at the time of each snapshot (i.e., at a specific known time every few hours, every day, or every few days), the pot is divided accordingly among the addresses of the users who wrote the posts to which tokens were staked.

Motivation:

Reward thought contributors and valuable members of the community for their work, incentivize broader community engagement, foster more rapid development of protocol initiatives, and improve network effects. Put staked YFI tokens (that are otherwise engaged when not being used for proposal voting) to more active use.

Specification:

At the time of a given snapshot, the YFI staked by each address in Governance is recorded and the recorded stake balances are compared to the stake balance recorded at the time of the last snapshot, in order to rebalance staked / “stake-able” tokens within this platform.

If feasible, it’d be useful to allow tokens within this platform to be staked to (deposited to) and subsequently un-staked from (withdrawn from) contributor’s posts, similar to a user Liking a post and then easily remove the Like if desired. Note that the distribution of stake to posted content should really only be relevant at the time of each snapshot.

According to Etherscan and https://stats.finance/ygov, at the time of this write-up, there is ~6,475 YFI (~$211,715,000) staked in Governance V2, staked by 10,438 addresses. Hence, at the time of writing, the average balance staked is 0.63 YFI per address, or ~$20,500 per address.
Based on my calculations, considering interest accrued on my own staked YFI through 1 week of staking, it appears that the staking reward APY over the past week (9/4 to 9/11/2020) was ~8.66% (please verify). This implies that, over the past week, the average daily fees deposited to YFI Governance was ~$50,000 per day (or 0.0866/365*$211,715,000). Note, I recognize that this math is overly simplified, but it should get us to a ballpark number for discussion purposes. Please comment if you believe that this is way off-base.

If 5% of this ~$50,000/day were diverted from the staking rewards pool to the Thought Contributor Pool (~$2,500), this would decrease the Governance V2 staking yield from 8.66% to 8.23%–a 0.43% decrease; however, it may be argued that a reduction in staking yield is worthwhile if it results in 1) incentive alignment for Thought Contributors, and 2) an increased incentive for Governance stakers to be more engaged in community discussions and proposals before they go to vote.

If all variables described above remained constant and fees generated by the protocol remained constant (big assumptions), based upon the distribution of “Likes Received” in the past week (9/4 to 9/11/2020), it is feasible that users such as @banteg, @Beepidibop, @tracheopteryx, @Dark, and @aliatiia have potential to be rewarded with between $500 and $2,000 in one week for their thought contributions and leadership in guiding discussions on this platform. But more intriguingly, it could lead to smaller value transfers to users that may just be entering the space to contribute their ideas and be rewarded for it, further engaging them and even giving them an opportunity to earn a stake in YFI governance over time, just through their thought contributions.

Additional Thoughts:

There may be some value in considering the use of Quadratic “Liking” (i.e, a user can stake more than 1 “Like” token on a given post, but for each additional “Like” staked on that post, the ‘stake cost’ of the “Like” increases exponentially), in order to more evenly distribute value more evenly over a variety of special interests of the protocol. There may also be value in considering the ability to delegate staking on such a platform to users of the platform, based on certain properties of those users (most active, most liked, most aligned with your interests, etc.).
Furthermore, I understand that there are some major issues with this concept, listed below (I’m sure there are plenty more) and would like to open up for discussion:

  1. This requires that all users of the system disclose their addresses, so that the system may issue the correct balance for staking and so that the system may pay out rewards to the appropriate user addresses.
  2. I’m sure there are a ton of attack vectors with this concept that I haven’t given too much thought to, such as 1) a user can have multiple accounts/addresses (sybil attack?), and 2) Spamming posts, as there is no disincentive for bad/useless posts and only incentive for good posts (is it worth considering a “Dislike” token as well?!)
  3. Even if such a system were possible today, is it scalable to millions of users?
  4. This opens the possibility that users that may not actually contribute all that much to community discussion, receive rewards just because of who they are. To be clear, I’m not so sure that this is a bad thing; it’s kind of like giving the Governance community more of a direct voice in choosing whom they feel should be rewarded for their contributions to Yearn, even if that work is not necessarily on this platform.

I fully recognize that the proposed concept may be very far-fetched, extremely difficult/costly to implement, and may be subject to scamming, but I’m posing it anyway, as I do believe that it would be a step in the right direction toward achieving a more robust protocol built upon a foundation of aligned incentives (which is ultimately the holy grail of a DAO). Prepared for backlash, so be as critical as you’d like with your feedback!

6 Likes

So I think in theory, this is a great idea, and I’m not saying that it won’t be great in practice either– I do like it. To be up front, I think I am also exactly the type of person who would benefit from this (I have the 6th-most likes received both in the past week and in the past month), so for what it’s worth there’s my conflict of interest.

Thoughts to try to prevent abuse:

  1. Only count votes/posts from accounts who have been around for x days, commented/posted x times, etc. This way someone couldn’t create a bot army to upvote all of their posts– if all of these bots were also required to make posts and comments for their “likes” to be valid.
  2. Perhaps the community mods could also just manually comb through those at the top– users supported by bots would probably be pretty easy to spot, since there really are a few faces who comment/post a good bit around here and engage the most– and as someone began to submit more meaningful content, they would come on the mods’ radar.

However, while I would love a little bit of extra yUSD since I am not a YFI whale, I certainly don’t contribute here for the $$– I do it because I believe in Yearn, because I think I have meaningful contributions that I can make, and because I want it for Yearn to be as good as it can be– and that only happens if we’re engaged. I think there’s a chance this could just lead to the whole space being cluttered with random posts and comments, which I don’t like the idea of– but as a counterpoint, we have not seen a massive influx of shitty strategy proposals after YIP 45 passed, so maybe those concerns are unfounded.

I think it’s also worth mentioning that a good amount of activity also happens on Discord, and I wouldn’t want to ignore those people there. I prefer using this forum because it’s more organized and easier for me to follow, so maybe if this helped bring some of the other governance folks back here, that wouldn’t be a bad thing either.

6 Likes

What might be easier is working with SourceCred (MakerDAO is right now), and they pay out in DAI for participation in the forum. They have an algorithm and everything. Seems to be working well

1 Like

I would probably post more often, but I’m not sure those additional posts would contribute anything more than the few I post now without compensation. I wonder if I would be less inclined to like others’ posts of I though it would reduce my compensation. Overall I think improving the system, which in the long term increases the value of YFI, is enough incentive.

Huh, didn’t think I’d rank this high since I’m always shutting down people’s proposals.

Since I’m a potential beneficiary of this proposal, I’m not sure if I can remain unbiased if I voice my opinion. Instead, I’ll just post the questions that comes through my mind when I read through a typical proposal.

  • Have this been brought up before?

    • Why was this approved/rejected if it’s been brought up before?
    • Have the circumstances changed since then?
  • Are there any red flags/major things that will compromise the protocol?

    • Will this increase centralization?
    • Will this compromise security?
  • Will this benefit the protocol long term? Is this sustainable?

    • What kinds of conflict of interest will this raise?
      • Which parties will be affected, and how?
      • Will the parties be fine with the change?
      • How to mitigate those unfavourably affected if the proposal adds overall good to the protocol?
    • Where will the funds be coming from?
      • Internally or externally?
        • Internally: think about conflicts of interest
        • Externally: think about risks
      • How long can funding last?
    • Does this proposal add risk to the protocol?
      • What are the potential negative consequences? (Most of the potential benefits will already be listed in the proposal)
      • What are the probabilities of those consequences happening?
  • Think about how to implement the proposal if it passes those questions

I also tend to not think about why this person made this proposal, I assume people just miss hidden risks unless they’re adamant said risks don’t exist after being informed of such. Then I start asking myself the why’s.

Lastly, remind myself to stay civil. Nothing destroys an argument faster than making your partner think they’re being accused/called out.

Everyone’s here to make this protocol better, at least that’s what I tell myself.

5 Likes

I’m ambivalent, since I’m not sure if the benefits outweigh the complexity this entails. However, if it does get implemented, then given that some contributors are now on yearn’s payroll, it seems questionable to make them double dip into a reward pool for essentially doing their job, if on the same terms as members of the community. So I think such rewards should be mainly or solely targeted to contributors who are not officially affiliated with yearn.

5 Likes

I forgot to mention it in my post, but I’m assuming that if someone is already on Yearn’s payroll, they would not be eligible for this sort of a thing– since like you said, they are already being paid for their work with Yearn.

The main benefit I see from this is essentially putting those who are generating value in the Yearn community transiently on Yearn’s payroll. However, instead of paying up front for the value you know they are going to add (all of Yearn’s current salaried workers), this only rewards those who are creating value after they have already done so. Again, I think this would require some oversight from the current community mods (to gatekeep bots/abuse), but it could be a nice way to continue to reward valuable contributions to the ecosystem. But again, it’s hard for me to be objective here.

3 Likes

But isn’t the community already doing this by giving grants to community members, in a sense? This seems like a lot of work and thought for just a posting rewards system. Also pretty sure any such system is game-able. Steem, and voice have done a lot of work on such systems and even theirs are gamed. I really like the idea, but I could also see people wanting to remain anonymous and not have their eth wallet linked to a username.
Currently, I feel like having the multi-sig consul handing out grants is working pretty well for people who contribute. Maybe they can just extend that to ‘Thought Contributors’ on the forum in some way. We could make a ranking formula for those who contribute a lot and recommend the multi-sig distribute some funds to them, maybe? I think the motivation behind this post is good, but the idea of a rewards system is hard to put in place when we have more important things to do.

2 Likes

Would be trivial to create a whole bunch of accounts, and then use them to go and start liking your own posts to boost your numbers.

Not against the idea of rewarding regular contributors though

1 Like

Bad idea. Incentivizes posting and spam. If users are contributing useful ideas they will likely be compensated through YIP45.

2 Likes

I also think this idea creates complications for the community and has more risk downside than reward upside. The governance structure is still in grooming and i think its headed in the right direction with yip -45, but offering incentives for just posting, is a recipe for spam In my honest opinion.
I believe its a bad idea to over-incentivize contribution in the form of ideas or proposals since it will dis-align the protocol’s health with the incentives that come with ‘changing/tuning’ it.
Beepidibop asked some very crucial questions in his reply, after reflecting on his thoughts its easy to see that this incentive structure wont provide long term health or stability in any meaningful way to the protocol or community.
Those whom contribute, generally do it for the benefit of the community or protocol and havent expected anything in return so far. It could create a dangerous precedent to incentivize the simplest contributions and could easily drive a wedge into some aspects of governance.
Its my summation that this proposal and would not align with the incentives of the community or yEarn

2 Likes