I am going to be posting more information about DAO governance and different strategies we could look into taking in the future. If you have any thoughts/ideas for how governance should work, please post them here.
You can find some of the documentation on how Tornado Cash governance works. This is one of the governance types that we talked about during the last meeting.
One of the downsides of this style of governance is the risk of a whale being able to buy a lot of the token and have a very large say in governance. This is prevented partially in Tornado Cash by not allowing relayers to participate in governance (they tend to have large amounts of the governance token) and you must be staked to participate in governance.
This is somewhat solved by the function in LunarDAOs governance by requiring people to stake and gain VOX to actually participate in governance. This might be able to keep whales from buying large sums of Lunar to try to swing votes. This creates a lag between when you stake Lunar and when you can influence governance.
I believe this comes from the veCRV primitive introduced by Curve. Curve is high inflationary, yet due to the locking periods - which return veCRV - which allows for LP gauges/rewards (the main juice in Curve tokenomics), the price of CRV is not performing bad (as a large supply is vested by the holders).
in LunarDAO we had decided to not go the path of endlessly self-printed token, rather cap the community token to 1b, sell 40% on genesis and program the governance token $VOX as a return for staking. On top of the deflationary model, we applied the primitive of Curve - when the amount of $VOX rewarded to $LUNAR stakers (or LPs) is larger with the locking period.
This mechanism gives advantage to the squad members who have a large commitment in the DAO (shown by time of locking) over whales who will attempt to overtake the governance while keeping their $LUNAR liquid to dump quickly.
In numbers this means that a holder of $LUNAR tokens - has 0 $VOX if they do not lock their tokens.
The minimum locking period to gain $VOX governance tokens is 7 days. But a staker locking for 1 year will get 50x more $VOX for the same amount of $LUNAR and a staker locking for 2 years will get 100x more $VOX for the same amount of $LUNAR.
This aims to balance commitment to the DAO against large bags speculators.
For more on the current $VOX reward ratio read: Staking $LUNAR
Furthermore $VOX will be airdropped to the initial community members - so they directly become a LunarDAO Squad members as reward for appreciation.
This has 2 main objectives:
- Create LunarDAO Squad - Give initial members a way to vote based on the intial support before the staking option (earning $VOX the normal way) is established.
- Reward initial members with a gift of a governance token which they will have forever (regardless staking $LUNAR)
The ration and details are described here: $VOX Airdrop
I am excited to read more and have further discussions on the governance models.
We have chosen the Sentinel Committee model (Multi-sig) for the points mentioned in the meeting:
- Prevent the whale treasury attack
- Create initial trust by known anons verifying the decentralization and credibility of the DAO
With time everything can be changed by the LIP + vote and Stewards will be there to ensure the procedures and running ops much more then ruling. That is the main function of the committee…
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I like this system a lot, it seems like it might be a good trade off with a simple form of governance while combating whale votes.
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