Main DAO Governance

Get involved!

Where is the DAO, how can I contribute?

You can be in a DAO but not be 24/7 active, which is totally okay. There are different ways to get involved and get rewarded for your time and skills. Head over to the Notion page and discover what initiaitve you can contribute to, and who gets the funding:

Gearbox Protocol did not have a core team from day 0, no central authority! Initial members handed over the code to the DAO who then deployed the protocol and even decided the initial pools, assets, collateral types, and so on. The DAO consists of the community multisigs and a few hundred of token holders as per the DAO-First Launch strategy. Snapshot + multisigs is used.

Governance is one of the most complex things which requires tedious research. MakerDAO, Element Finance, Yearn, Coordinape and other protocols have advanced this process forward also by making data on voter apathy and activity. The goal is to figure Gearbox governance step-by-step and have users be in control of the protocol. Have the community decide and iterate!

It's important to note that all distribution vestings and other parameters were hard-coded in smart contracts no ensure no requirement for trust from day 0. Everything communicated was in code, verified, and audited. But make sure to know the risks.

Governance discussion process

1. Ideation process in Discord.

This can occur in any chat really. It's best to outline the voting parameters (WHAT are you actually voting for: YES or NO question, for instance) during this process so you would have a better understanding of what to propose on forum. Discord place for that:

2. Proposal and Snapshot.

After some initial feedback for an idea was received informally, a formal proposal must be put out with concrete explanation of the proposed idea. It should be put up for voting on the snapshot page, including the transaction details the DAO would be voting for, to avoid any multisig subjectivity later. This means that a proposer should seek technical help to prepare such a transaction prior to submitting a snapshot proposal. A quorum must be bet in such case.

Proposal to be made here, as a formal GIP:

Snapshot is here:

3. Guard [multisig] execution.

Multisig must execute whatever proposal reaches winning quorum. Given that multisig are members previously enacted by token holders, meaning the DAO, are semi-public people with big reputation - in extreme cases they could voice against implementing some proposal. There is a Veto role for that.

Check the members of the guards and their functions:

Guards [Multisigs]

Initial Governance Specifications

Reverse Voting Escrow: reducing voting weights of initial core members & initial contributors

While it's not unnatural for initial core members and contributors to have larger token percentages than regular smaller users (either by early investment, or by early farming, or by just being richer) - it is however a problem for early governance. If small holders have no opportunity to coordinate and price out the larger holders together - governance can be seen as flawed. As such, Gearbox DAO in the early stages - thanks to snapshot mechanics - evens out the playing field by making sure community members have higher voting power than early members.

So two issues needed to be fixed:

  1. Whale portions dominating governance as voters;

    Fix -> community delegators to unite small holders.

  2. Whale portions delegating and still dominating;

    Fix -> limit governance weights of whales completely.

The distribution had a few portions:

  1. Community members including Credit Account Mining and other portions: full x1 multiplier.

  2. Contributors A meaning initial core members: multiplier of x0.125

  3. Contributors B meaning initial contributors: multiplier of x0.25

  4. Company wallet: cannot vote on anything before and if the governance model changes.

  5. DAO wallet: cannot vote unless it gives grants to people, which then gets x1 multiplier.

This way, community voices are over x2 bigger in its voting power than early contributors and initial core members combined! According to that, the DAO portion can really be counted as a community portion because of who practically gets to decide what to do with it, whereas neither early group can push anything at their own free will. Avoiding situations of the misuse of power.

GEAR Token

Delegation is available to streamline community work

Snapshot page delegation is turned on for delegators from the community to unite and allow smaller holders get their voice. Anyone can delegate to any delegator or multiple delegators at once, including initial core members and contributors. But their votes are reduced, to even out the playing field. See the point above for all the details. This is done on the snapshot page.

Community Delegates

A minimum of 3 days period must be selected on the snapshot

In order to ensure enough time for voting to be done fairly, a 3 day period must be ensured at minimum - with a maximum of 7 days in case the proposal requires that long. Given that prior to a snapshot vote a proposal must be discussed publicly on forum, there is practically more time for one to engage and be prepared to case their vote.

Minimum 0.02% of total supply to make a snapshot proposal

In order to avoid spam proposals and governance distortion at the snapshot level - and to not cause subjective issues when a proposal is removed for being spammy (which is a subjective matter, and subjectivity must be removed as much as possible) - a minimum of 0.02% of total supply of GEAR are required to make a snapshot proposal.

At the valuation of 100M that is 20K USD worth and at valuation of 1B that is 200K USD.

A winning vote must also have > 2% total supply quorum

That is a number required in support for a proposal choice in order to classify as legitimately winning, and not the participation in a vote in total.

In terms of eligible votes percentage, you need to subtract the DAO portion (51%) and company wallet (11%), as well as reduce early contributors voting weights. Given that initial core members voting weights are being reduced from 20%->2.5% and initial contributors from 9.20%->2.3% - it is almost impossible for early members to pass whatever they want on their own. As such, it is about 2% from the 12% of the available votes, so a 17% quorum of eligible votes for a winning vote. Community having over 8% is the deciding factor.

A working idea: since it's technically impossible to vote for something like "let's never vote for X again" as such proposals make no sense - a cool-off period of 2 weeks can be established if a proposal went live but did not reach quorum.

Company wallet is not allowed to vote

While contributor wallets can vote according to their reduced multiplier, company wallet is not allowed to vote at this stage. Once the vesting starts happening and tokens change hands, new owners would naturally be able to vote. However, that is over 1 year away from launch.

DAO can always decide to lower or increase the quorum or proposal minimum threshold.

Proposals on the forum which violate basic human decency like "let's cause damage to someone" can be removed by forum admins, among which community members are. However, proposals which seem weird to some - but do not cause any hard or violence - cannot be removed, as there is no subjectivity allowed when moderating an open forum.

If a snapshot vote was not submitted correctly, for example less than 3 days window for voting - it technically does not count as legitimate and can be taken down by snapshot page admins (the DAO). It is always better to ask for guidance in Discord about how to properly present the voting choices in order to make sure it is worded correctly.

Practical point with regard to the snapshot

gearbox.eth

Given that snapshot voting is off-chain (yet trustless and verifiable) - some parameters allow for flexibility, which is how such a model as described above is possible. Keep that in mind.

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