DAO CAll - July 7, 2021
Summary Notes, Weekly DAO Call, July 7, 2021
Team in Attendance: Jesse
Members in Attendance: @ace, Alan, asiaexpat, Bree, DJSTRIKANOVA, Howard K, Jehudah, mikel, Rochelle, splottingham, Vincente Caldhuch
Roles: Call Moderator: Bree/DJSTRIKANOVA; Recorder: Bree; Proposal Tracker: splottingham
ANNOUNCEMENTS:
Find the AMA write-up and audio links here: https://effect-dao-docs.gitbook.io/effect-dao-amas
Thank you to Jesse for his nicely written article about the DAO https://medium.com/effect-ai/6-month-anniversary-of-effectdao-bd655cc96241
PROPOSALS:
Integrate My Calculator With The Effect DAO Dashboard https://dao.effect.network/proposals/51 Status: Active, Vote: No
DJSTRIKANOVA thanks those who voted yes, but it looks like it will not pass.
Jesse has given some technical feedback. He really appreciates the homework needed and the work put into creating this. Jesse stated that he did have an internal debate about the token ask, because he doesn’t really equate the value of EFX directly to fiat and felt that the token price was a bit high. He does really want to encourage developers and so voted yes to encourage this process more for developers and to reward DJ for all of his hard work, not just around the calculator.
This leads into a possible the need for a treasurer. A treasurer could be responsible for controlling and managing a reserve of fiat to allow for a pool of stable coin to payout for developer asks in fiat.
The price has already gone up and down since the proposal was posted.
Creating the product first was important to not be getting into negotiations with the DAO about how to proceed.
The calculator will still be available if the proposal does not pass, but will be on a private site that may require EFX in donation or payment to use the tools, instead of being integrated into the dashboard.
Role of Responsibility – Formal Role Creation - DAO Call Recorder http://dao.effect.network/proposals/49 Status: Closed, Accepted
DAO Call Recorder – Application to fulfill the role http://dao.effect.network/proposals/50 Status: Closed, Accepted
DAO Call Recorder ‘invoice’ for May 2021 http://dao.effect.network/proposals/49 Status: Closed, Accepted
QUESTIONS/DISCUSSIONS FOR/WITH TEAM:
June 30th AMA:
General sense and feedback from the community is that this event was very successful and was quite dense with information.
Thanks to Mikel, Aleks, Ana, and Jehudah for participating as interviewers.
Thanks to Rochelle for hosting and managing the event and working on the questions and mediating with the team, and for making sure there was a clean recording.
Thanks to Chris and Jesse for participating so candidly on the live event.
Thanks to the collective team for answering the written questions in time to pre-release for the interviewers.
Thanks from Jesse to Bree for planning the event.
The link to the notes will be released today. A clean audio recording will also be released. https://effect-dao-docs.gitbook.io/effect-dao-amas
We should consider when or if another AMA of this nature would be appropriate. There have been comments about hosting more in the future.
Telegram
Thoughts on creating an Effect DAO managed and run Effect Network Telegram group.
This does not seem to be a logical option at this time.
Who would want to moderate?
Discord serves the needs for communication.
Proposals can be discussed individually in Discord.
The fewer Telegram groups the better.
It would be helpful to have the Discord links allowed to be posted.
Laurens will update the whitelisting of the old bot. We will send him links to be whitelisted.
Community GitBook
Eospowerup.io
The calculator
Discord links
Discussion regarding formally defining the DAO weekly calls to something akin The General DAO Council, which includes the attendees of the Weekly DAO Call and representing all members, regardless of attendance record. And defining The Executive which include the roles of responsibility (they are required to execute jobs and are compensated).
This model seems scalable and may work, but as there are not too many people joining in the calls at the moment, it seems that this would add unnecessary bureaucracy.
Reporting of sub-groups to the weekly calls.
The Hack-a-thon sub-group provides updates to the weekly calls.
High Guard (intended to be temporary)
There are people who attend weekly calls regularly and are on the HG, but there is no communication about HG discussions or decisions given to the weekly calls/ general DAO.
The HG is due a cleaning up of members.
This is being looked into though some kind of vote
Perhaps a GitBook space for the HG could be created to list the members of the HG and provide updates.
GitBook would be an appropriate space for providing updates from the HG. Weekly call updates would not be necessary if this were done.
The problem with volunteers is expecting someone to take on the responsibility of providing the updates. Consider creating a role of responsibility that is compensated for maintaining GitBook updates.
Before anyone takes on a role of responsibility it is prudent that there is an elected HG.
Should the HG be more engaged in educating or strictly just a brake on potential malevolent impacts on TEN?
Suggestions:
Define exactly what the HG’s role is,
this should be visible on the blockchain and on the dashboard, in the smart contract
Elect new members
Make use of GitBook
A role of responsibility for the HG is getting too far ahead at this time.
Role of Responsibility: Treasurer
More than one person in this role? Signing authorities in multiple hands.
Manage funds for proposals that cross over more than one cycle.
Encourage fair pay vs. instability in EFX price vs. exhausting available cycle funds
If there was a stable coin managed by a treasurer then this would provide stability to the ask price based upon the time of asking
This is an interesting idea that warrants more thought. More discussions are required to really see how this could be implemented.
There may not be any need for stable coins if the EFX ask is based upon a doller rate at the time. Any variation would be a plus or minus of the EFX to meet the amount of EFX needed to meet the $ amount.
An oracle may work for this. But there are potential problems with oracles technically. Using a stable coin would be better than using an oracle.
Larger proposal asks may need to be extended over time. How could this be done?
Payments of proposals are automatically paid out after a delay of time to allow the HG to address the proposal.
Questions that allow for sentiment about how much the DAO might be willing to pay for something that is being requested to be done might help.
For example: The DAO really wanted a calculator. No one stepped up to do it, until DJ did. But the DAO were never consulted on how much they were willing to pay for a calculator. This also means that any developer taking on the task were not given a guideline for how much of their time/cost to consider in the making of the calculator.
Having a secondary or sentiment qualifier option in a proposal would be prudent.
There should be an option to ask questions of the DAO that require more than a Yes/No/Abstain option for the responses.
The bigger concern here may be more related to the conflict of interest regarding where the cycle rewards.
Setting a fixed reward amount instead of the 30% of unused fees.
Allocating an additional amount from the treasury to the fee pool for a consistent and predictable reward for participation.
Network fees would be in addition to this.
This would allow for a reliable base amount for participation reward
Allowing the full amount of cycle fees to be available for proposals
Would require a proposal and would override P6.
The idea of changing the 30% distribution to members seems to be favourable.
Would this be a reasonable change to the smart contract.
There are two things that need to happen.
Something needs to happen with the left over cycle budget.
Adding another system creates complexity and the more simple the better.
The simple suggestion is:
The cycle budget is increased by 100k. This100k is then distributed to the DAO as a participation reward for reading and voting.
The remaining budget is available for proposals. 100% of what is left over after proposals is returned to the treasury.
Network fee distribution is in addition to the 100k.
Alternating times for DAO Calls to allow for greater participation.
One week early, the next week later.
Suggesting a little earlier in the day about 2 or 3 pm CET
Suggesting before business day 7 or 8 am CET
Jesse is open to any time of the day, even in the evening.
Create a sentiment proposal to help determine the best times for meetings to accommodate the majority of people interested in attending. Bree will do this.
Create a proposal are you interested in attending.
Imbed another poll site into the proposal to get a sense of the preferred times.
If they vote yes, they go to the poll. If no, then they are done.
LIQUIDITY: Updates and discussions by Mikel
There is a clear need to improve liquidity on BSC. Discussions with the team have been ongoing to work to find community/team/foundation solutions for this problem.
In regards to the DAO itself funding liquidity, what would be the best process to get the BNB?
We have a problem as the DAO in getting BNB off the market because, 1. the token price is at a point where DAO members do not really want to swap EFX for BNB, in fear of suffering some degree of impermanent loss, and 2. Even if we want to get BNB off the market selling EFX, there just isn’t enough liquidity to make the purchase without causing market dumps.
There are some options to consider:
Find a partner to borrow the funds from even using EFX as collateral.
Make a legal agreement with another person or company where we pay them, say 10% or 15% on an annual basis, where we borrow BNB to put into the pool.
Temporarily borrow BNB from the Foundation, because the Foundation should have enough funds for us to borrow from. (preferred)
Say we’d like to put in 500K in liquidity into Pancake Swap, we’d need to put in 250Kusd of EFX from the DAO and 250Kusd of BNB that would be borrowed from the Foundation.
It is possible that up to 300Kusd could be borrowed from the Foundation, but this would need to be verified through Chris/Jesse or through the treasurer for the Foundation.
How would the DAO get around the cycle budget restrictions, as 250kusd equivalent EFX would well surpass budget restrictions? Would we need to get this out over time or do a budget override?
Because this is not actually paying someone to do work for us, this is much bigger, there would need to be a budget override.
This would not be a proposal request to use funds from the cycle budget. This would be a proposed request to borrow funds from the DAO treasury that would be returned at some point to the treasury. This would require a manual override of the smart contracts to access these funds.
This could be done by adjusting the smart contracts to allow a fund release to another address. The Foundation would need to approve this transaction to allow the keys to be used to move funds from the treasury to another address.
For now, (because the DAO is not yet fully in control of the smart contracts) it would require a smart contract override by the Foundation, approved by the DAO.
There does need to be caution given to lifting the limits to how much the DAO can spend, this needs to have some considered thought to how accessing larger amounts is normalized.
Perhaps, there needs to be a super majority of say 70% to approve proposal requests that supersede the cycle budget.
The DAO will need to decided on how certain types of requests are managed. How to best manage the voting majorities.
The DAO does own the treasury, the Foundation holds custody of the smart contracts until which time the DAO is mature enough to take control of the contracts. It really is up to the DAO to implement measures of how to best control and protect the treasury. At the moment, it is set up to issue small measured amounts each cycle, but the DAO would be able to change this.
The DAO is really young. It is state of the art technology that hasn’t had the time to prove itself yet. So, the Foundation is there to hold custody of the smart contracts until which time the DAO is ready to take over control of them. The DAO is really a very long way off being ready for this though.
In this case, the funds requested from the DAO treasury and from the Foundation would be for providing liquidity. They are not being requested to be spent, or burned, or in any other way to be permanently removed. These funds are being borrowed with the intent to be returned at some point.
Would there be any interest required to be paid back or fee to be paid for borrowing funds from the Foundation?
No. Regarding the DAO providing liquidity specifically, the Foundation does not have any interest in having the DAO pay any interest in the loan, because the DAO will eventually take over the Foundation. Given time, this would mean that the Foundation would be taxing itself. The Foundation would not gain any benefit from paying itself from the DAO.
Confirmed by Jesse: The Foundation made the DAO. The Foundations sole purpose is building Effect Network, and having the DAO indeed replace it. So, agree, it should be an interest free loan.
Even interest free there are still risks. We hope that the growth of EFX will outpace BNB, but it’s possible that BNB could have a huge jump in growth far outpacing EFX growth. This would create a deficit.
The loan could be issued in usd equivalent amounts of equal parts EFX and BNB. When returned to the treasury and to the Foundation the split could be 50/50% of the LP, regardless of dollar value.
Jesse (not transcribed exactly): There are two parts to this proposal, part 1 is providing liquidity, part 2 is requesting treasury funds to be able to do so. The big problem is that the DAO has only EFX, so how could they provide BNB (liquidity being the issue). And requesting funds from the Foundation, well, the Foundation is already providing liquidity to the BSC pool. The most simple way might be for the Foundation to increase the amount of liquidity to the pool, because there is no shortage of EFX in the Foundation either. The Foundation might also increases liquidity for the incentivization program and distribute that to the DAO fee pool.
While this would be ideal, the DAO has no control over the Foundation. The DAO cannot propose and approve this of the Foundation. Perhaps the Foundation could be approached by [Jesse] to request this and for the Foundation to work with the DAO in providing liquidity and the DAO provide an incentivization program. Perhaps linked together.
Jesse: When we are moving loaning into BNB, it requires the Foundation to give commitment and take risks. This is being done anyways currently, as they are already providing liquidity. I can take this discussion there to request more funds be put into liquidity. There is a lot of interest there in this. The entire purpose of the Foundation is to make TEN a bigger success. It would be a small step to just increase the amount put into liquidity.
Incentive programs: The best thing is to have our own incentivization program where people are actually able to earn rewards from providing liquidity. As we don’t have our own Syrup pool we must find alternate ways of going about this.
We could make our own type of incentivizing pool.
First: we need to calculate how much liquidity that we want.
For example, if we want 1M liquidity, then we need to subtract how much is in there now, so then we have a measure of how much liquidity we want to add. Then look into the market to find out what is the normal interest rate for defi projects. So let’s say we take 20%, then we can calculate how many rewards would be needed to give to liquidity providers to make sure we had 1M liquidity in there in total. To create an equilibrium of inviting people to give to the pool vs. giving too much in return.
This would require either manual work or smart contract programming on how the distribution would work. Whether this is on EOS or BSC. The most elegant way would to have our own Master Chef contract on BSC, which is basically a contract distributing funds. Jesse looked into this and it would be quite some work to make a MC contract. Perhaps we could take frequent snapshots to reduce the amount of complexity and work, and manually air drop the EFX to liquidity providers.
Second: Perhaps Chris, or someone, to find smaller defi platforms in the BSC ecosystem, so not Pancake Swap but some smaller ones, to see if we can make a good partnership to have a farm or a pool on their side. To build out EFX as a token a bit more in the BSC ecosystem. There are more platforms than just PS.
We still need to structure how much the rewards would be and how they would be distributed to providers. If this is something we would dynamically evaluate, each cycle or each month.
It would be good also if incentivization would draw people away from the DAO who are only there to collect rewards and are not interested in governance at all. This way those on the DAO would be more involved and engaged in the governance and in working on improving TEN and working on fundamentals.
There is also a lot of extra EFX due to P22. We need to figure out how to incentivize the use of those extra EFX.
People need to be willing to give up their EP.
There are also many tokens in circulation that are not being staked.
What we really want to prevent is failure of a launch in the same way the Bridge and Launch of BSC happened. Failure in terms of enthusiasm vs. expectation. There needs to be a sufficient amount of volume, there needs to be a sufficient amount of liquidity to promote volume. We want to resolve volume.
We need to fix this liquidity issue with the incentivization program, coupled with providing liquidity provided by the Foundation.
The desired result would be that this would lead to a nice floor in the liquidity pool to allow people to enter and exit with meaningful amounts.
Regardless of what the market price results as afterward, it is about having enough liquidity to allow for meaningful exchanges.
With a meaningful APR, based upon EFX.
Depending upon the Foundation’s actions, would impact how much would need to come from the treasury.
It would also require having a BUSD/EFX stable-coin pool, but this would come with it’s own need for pool volume.
HACK-A-THON:
There are no changes or updates to add at this time.
Just confirming that Devpost to host the hack-a-thon will be used and that smart contract work will need to be done to allow DAO members to vote on projects.
Question for Chris:
Chris announced a prize pool of 50k, but did not specify if this was dollars or EFX.
Was this amount random? Was there discussions about this?
OPEN DISCUSSION:
OLD DISCUSSIONS (tabled)
Discuss further with team about incorporating worker pay in perpetuity of trained algorithms.
Discuss a system to subsidize or support resource fees for DAO members.
Potential Proposals:
How to become a guardian guide
Using Effect Captions to update community made guide videos. Especially videos with lasting relevance. Could be used to promote Effect Captions.
Would need to include the quoted price points in the proposal
What languages would be prudent to put into the closed captions
English only would be about $20
Developer costs for dashboard improvements
The community developer group
There will likely be a proposal mapped out with multiple phases.
Before the proposal is put forth they need to decide how to arrange for taxes and other dynamics related to payments
Proposal for opensource the product
Timeline
Proposals to the Foundation:
DAO Store start-up expenses
Hack-a-thon expenses
Tasks:
Time zone proposal
Dashboard updates:
Reward calculator (P30)
Timeline
Token Flow Map
Worker of the Week into DAO dashboard (P29)
Ambassador TEAM google Drive
Discuss decentralized options or to create an interface to access IFPS storage
GitBook:
Guide on how to become a guardian
Hackathon group creation
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