[GP-4] Governance Reform Proposal

General
1

Author: @Ras
Submission date: 2024/03/28

Summary

This proposal aims to carry out a governance reform in order to enhance the efficiency of the DAO by making adjustments to the governance process.

Context/Background:

​​The Seamless DAO and Governance system has been fully operational for over 4 months, during which dozens of governance proposals have been deliberated within the community through platforms like Discourse and Discord. Notably, many proposals have seen offchain Snapshot labs signaling votes, with six proposals having progressed to full on-chain voting (and execution). This has resulted in community initiatives like the Seamless Community Grants Program and Seamless Spark as well as numerous protocol parameter updates.

However, these experiences have highlighted the need for additional pathways for off-chain governance actions, such as nominating SCGP committee members. Moreover, the lengthy governance process, particularly for basic administrative updates like borrow/supply caps adjustments, has been acknowledged. Looking at the operational histories of other DeFi liquidity market protocols, it is expected that such governance proposals will persist or even increase in frequency.

Therefore, a comprehensive review of the governance proposal processes is recommended, along with the following proposed reforms for community consideration and voting to streamline and enhance the current governance model.

Proposal:

This governance reform proposal focuses across four areas:

  1. Introduction of a governance category that requires offchain snapshot voting, ONLY - i.e. General Proposals (GPs)
  2. For Protocol Change Proposals (PCPs) and Governance Change Proposals (GCPs) - the removal of offchain component and utilizing the onchain voting mechanism, ONLY
  3. Creation of of special purpose community-run multisigs to handle (very) limited low-security risk responsibilities
  4. Suspension of the Fast-track procedure

Introduction of General Proposals (GPs)

A new governance category is proposed to be added to the current governance structure. General Proposals (or GPs) are governance proposals that are fit for only an offchain vote on Snapshot Labs. Quorum will be set to 1 million SEAM and a simple majority is required to have been considered as “passed”. This will be utilized for various offchain initiatives such as nominating SCGP committee members, or other future special initiatives that do not have an onchain component. In cases where there are protocol changes or other similar onchain changes, the normal onchain governance process will be utilized.

Reform PCPs and GCPs to onchain voting component, ONLY

It is proposed that Protocol Change Proposals and Governace Change Proposals no longer utilize Snapshot Labs for offchain signaling prior to an onchain vote. Rather, the process proceeds from discussion in Discourse, with optional signaling via Discord or Discourse polls. If a discussion has passed previously outline parameters AND has enough delegated voting power to form an onchain proposal, then it is permissible for a proposal to proceed directly to an onchain vote. The low voting costs on Base Layer 2 and high quality of proposals so far mean the signaling and spam filter nature of offchain signaling prior to onchain voting is obsolete for the protocol’s current needs. This allows for a more streamlined onchain voting process.

Special purpose community-run councils/multi-sigs

It is proposed that the ability to create protocol rewards schedules/emissions and to adjust supply and borrow caps on lending markets to be transferred from the governor to community-run councils. This can be considered as an extension of the Guardian multisig concept. with further governance procedures to be developed and created by the Seamless Community/DAO on an ongoing basis. This allows for basic administrative functions to be executed more frequently and efficiently, such as the introduction of new third party reward schedules or cap adjustments. These functions have low risk for the protocol, and the community stands to benefit from the increased agility this grants the DAO when reacting to changing market conditions. This concept, in addition to proposed change #1 above (i.e. GPs), lays out the basic infrastructure needed for future council/multisig creation for a variety of community initiatives. From a starting point, some or all of these multisigs will utilize quick snapshot voting as the governance mechanism of choice and adhere to current snapshot voting parameters and standards setup for Seamless DAO.

Suspension of the Fast-track procedure

The implementation of a new governance process will enable the DAO to address proposals within a timeframe as expedited as 7 days, mirroring the efficiency of the current fast-track procedure. Consequently, should the current proposal pass, the fast-track procedure will be discontinued.

5 Likes
2

Ras, Nice idea to change processes smoother and more effective.
It will really streamline how we make decisions and keep things moving forward.

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It’s really good project

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I think this is a good idea - will allow for quicker responses - the community should be able to overtime help with the setup of the multisigs in some trustless manner - i think there are some projects addressing this

1 Like
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Yes +1 to this. Adds for faster mobilization of governance to enact changes to help the protocol. Also allows for shorter cycles to move things through the finish line when needed. In Favor to streamline these new processes @Ras

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6

I’m all for this proposed changed. It makes a lot of sense to categorize whether changes need to be onchain or offchain and choosing the vote method accordingly. I am in favor of these updates!

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+1 for this proposal

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8

I am in support. I think it is important for the community to continually re-assess governance processes to make sure they match the maturity stage and market realities facing the protocol.

At the moment, it’s important to design for agility as the market is in a highly volatile state and we have seen a low amount of low quality/spam like proposals. As such I support this as a next step in governance evolution. In the future - if governance realties change again, we can revisit and reintroduce some “filters” as needed again.

I suggest to @Ras as the original poster, maybe consider leaving this open for public comment for another 12-24 hours and barring any major feedback/comments/updates, this could be moved to a snapshot vote to see if a community quorum of SEAM can be reached?

ALSO - should this be named [GP-1] or [GP-4} perhaps? to be sequenced correctly

1 Like
9

Completely agree for prolonging the discussion since the proposal suggests quite some changes to the current governance process.

As for the name, I will add a number when 12-24 hours pass, before the cooldown period

10

Thanks @Ras for this proposal and continually advocating for improvements to Seamless’ decentralized governance processes! I support all 4 points in this proposal

11

Regarding point 3, “Special purpose community-run councils/multi-sigs”. We should deploy a risk steward contract to manage the supply/borrow caps more efficiently (i.e.: respond to the market more quickly). For reference here is the contract source code, ref.

Important notes regarding risk steward permissions:

  • The risk steward cannot set a cap if one is not already set by governance
  • The risk steward can only increase caps
  • The risk steward can increase caps by at most 100% at once
  • The risk steward can only increase caps once every 5 days
12

Thank you @everyone for your support and comments. With the overwhelming support I suppose we can proceed with the formal submission of [GP-4] Governance Reform Proposal with @wes_fred amendments on board.

Additionally, given the general market conditions and fast development of the protocol that opens exciting opportunities for the DAO, I suggest that we use (seems to be the last time) the Fast Track procedure. In accordance with the established criteria, we will need support of at least 6 Level-2 users.

As this proposal incorporates part that require on-chain voting and those that does not. I suggest that launch a parallel voting on Snapshot and tally.

[GP-4] Governance Reform Proposal

Will be put to a Snaphot vote as the following:

Summary

This proposal aims to carry out a governance reform in order to enhance the efficiency of the DAO by making adjustments to the governance process.

Context/Background:

​​The Seamless DAO and Governance system has been fully operational for over 4 months, during which dozens of governance proposals have been deliberated within the community through platforms like Discourse and Discord. Notably, many proposals have seen offchain Snapshot labs signaling votes, with six proposals having progressed to full on-chain voting (and execution). This has resulted in community initiatives like the Seamless Community Grants Program and Seamless Spark as well as numerous protocol parameter updates.

However, these experiences have highlighted the need for additional pathways for off-chain governance actions, such as nominating SCGP committee members. Moreover, the lengthy governance process, particularly for basic administrative updates like borrow/supply caps adjustments, has been acknowledged. Looking at the operational histories of other DeFi liquidity market protocols, it is expected that such governance proposals will persist or even increase in frequency.

Therefore, a comprehensive review of the governance proposal processes is recommended, along with the following proposed reforms for community consideration and voting to streamline and enhance the current governance model.

Proposal:

This governance reform proposal focuses across four areas:

  1. Introduction of a governance category that requires offchain snapshot voting, ONLY - i.e. General Proposals (GPs)
  2. For Protocol Change Proposals (PCPs) and Governance Change Proposals (GCPs) - the removal of offchain component and utilizing the onchain voting mechanism, ONLY
  3. Suspension of the Fast-track procedure

Introduction of General Proposals (GPs)

A new governance category is proposed to be added to the current governance structure. General Proposals (or GPs) are governance proposals that are fit for only an offchain vote on Snapshot Labs. Quorum will be set to 1 million SEAM and a simple majority is required to have been considered as “passed”. This will be utilized for various offchain initiatives such as nominating SCGP committee members, or other future special initiatives that do not have an onchain component. In cases where there are protocol changes or other similar onchain changes, the normal onchain governance process will be utilized.

Reform PCPs and GCPs to onchain voting component, ONLY

It is proposed that Protocol Change Proposals and Governace Change Proposals no longer utilize Snapshot Labs for offchain signaling prior to an onchain vote. Rather, the process proceeds from discussion in Discourse, with optional signaling via Discord or Discourse polls. If a discussion has passed previously outline parameters AND has enough delegated voting power to form an onchain proposal, then it is permissible for a proposal to proceed directly to an onchain vote. The low voting costs on Base Layer 2 and high quality of proposals so far mean the signaling and spam filter nature of offchain signaling prior to onchain voting is obsolete for the protocol’s current needs. This allows for a more streamlined onchain voting process.

Suspension of the Fast-track procedure

The implementation of a new governance process will enable the DAO to address proposals within a timeframe as expedited as 7 days, mirroring the efficiency of the current fast-track procedure. Consequently, should the current proposal pass, the fast-track procedure will be discontinued.

[SIP-7] Governance Reform Proposal

Will be put to a Tally (on-chain) vote as the following:

Summary

This proposal aims to carry out a governance reform in order to enhance the efficiency of the DAO by making adjustments to the governance process.

Context/Background:

​​The Seamless DAO and Governance system has been fully operational for over 4 months, during which dozens of governance proposals have been deliberated within the community through platforms like Discourse and Discord. Notably, many proposals have seen offchain Snapshot labs signaling votes, with six proposals having progressed to full on-chain voting (and execution). This has resulted in community initiatives like the Seamless Community Grants Program and Seamless Spark as well as numerous protocol parameter updates.

However, these experiences have highlighted the need for additional pathways for off-chain governance actions, such as nominating SCGP committee members. Moreover, the lengthy governance process, particularly for basic administrative updates like borrow/supply caps adjustments, has been acknowledged. Looking at the operational histories of other DeFi liquidity market protocols, it is expected that such governance proposals will persist or even increase in frequency.

Therefore, a comprehensive review of the governance proposal processes is recommended, along with the following proposed reforms for community consideration and voting to streamline and enhance the current governance model.

Proposal:

  1. Creation of of special purpose community-run multisigs to handle (very) limited low-security risk responsibilities

Special purpose community-run councils/multi-sigs

It is proposed that the ability to create protocol rewards schedules/emissions and to adjust supply and borrow caps on lending markets to be transferred from the governor to community-run councils. This can be considered as an extension of the Guardian multisig concept. with further governance procedures to be developed and created by the Seamless Community/DAO on an ongoing basis. This allows for basic administrative functions to be executed more frequently and efficiently, such as the introduction of new third party reward schedules or cap adjustments. These functions have low risk for the protocol, and the community stands to benefit from the increased agility this grants the DAO when reacting to changing market conditions. To achieve this, the guardians shall be granted the REWARD_ADMIN role for SEAM/esSEAM. This concept, in addition to proposed change #1 above (i.e. GPs), lays out the basic infrastructure needed for future council/multisig creation for a variety of community initiatives. From a starting point, some or all of these multisigs will utilize quick snapshot voting as the governance mechanism of choice and adhere to current snapshot voting parameters and standards setup for Seamless DAO.

Implementation

A risk steward contract shall be deployed to manage the supply/borrow caps more efficiently (i.e.: respond to the market more quickly).

Important notes regarding risk steward permissions:

  • The risk steward cannot set a cap if one is not already set by governance
  • The risk steward can only increase caps
  • The risk steward can increase caps by at most 100% at once
  • The risk steward can only increase caps once every 5 days
3 Likes
13

Looks great! Thanks for your work on this. Looking forward to voting on the Snapshot proposal!

Let’s fast track this!

14

Thanks @ras. I support fast track for this!

Regarding SIP-7, “This allows for basic administrative functions to be executed more frequently and efficiently, such as the introduction of new third party reward schedules”. To achieve this, I believe we should also grant the guardian the REWARD_ADMIN role for SEAM/esSEAM. In the future, as the community so wishes this may be transferred to a rewards specific community council/multisig. Note that this role simply allows control of the reward emissions programs for each market (i.e.: emissions rates), the rewards budget itself must still be funded by governance.

1 Like
15

Thanks for follow up @Ras . +1 again from me on this one.

16

Lets get this thing fast tracked! Thanks Ras for putting this together and consolidating the feedback from the chat. Still in alignment and am in FAVOR. I feel we should move this forward with this updated structure.

17

agree on the fast track as well ! looks like can get this rolling then

18

Thanks for so quick responses. Changed accordingly, thanks @wes_fred for the scrutiny !

We have a necessary Level-2 users support.

The offchain part is live Snapshot

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Yes to this and yes to the fast track. Looking forward to the snapshot and potentially moving this forward quickly.

1 Like
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The onchain component is live on Tally, voting will start in 2 days. Tally | Seamless Protocol Proposal

3 Likes