[Primary Proposal 1] - Getting University Blockchain Groups Involved in Governance

Apologies for the late response - I agree with all of these points and am in support of this proposal. I think though that a multisig would have to be set up to delegate to each university group though - someone can correct me if I’m wrong. You can delegate your voting power to only one address at a time afaik.

You’re right. That’s my fault. I suggested they only needed one wallet. Forgot about that gotcha.

Ah np. I was wondering why it was stated as such when I mentioned that caveat earlier (should have elaborated though)

Thanks for catching that @Midhav and @ryan! We’ll make the update as suggested.

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I’m posting the updated proposal below after @ryan gave it a final review. We addressed everyone’s comments and contributions. Thank you all for your input!

API3 University Governance Initiative Proposal:

Summary: BlockVenture proposes a University Governance Initiative to get university blockchain groups involved in API3’s DAO governance. The purpose of this program is to empower university blockchain groups to participate in API3 governance.

The API3 DAO will lend 1M API3 tokens to a Gnosis multisig managed by the API3 marketing team and BlockVenture. A maximum grant of 100K API3 tokens will be delegated to each university. BlockVenture will select the university blockchain groups and will serve as the administrator of this program on behalf of the API3 Marketing team; however, delegation will need approval from both the BlockVenture and API3 signers. Note: the purpose of the 1M token amount is to give each university group the ability to submit a proposal on their own. BlockVenture will cap the program at up to 10 university blockchain groups.

Abstract: The aim of the University Governance Initiative is to select university blockchain group delegates that will bring real value to the API3 project and to provide participation from delegates outside the core team.

The objectives of the blockchain groups selected for governance are to contribute to:

  1. Transparency
  2. Decentralization
  3. Innovation
  4. Efficient Use of Resources
  5. Responsible Risk-Taking

This program will be administered by BlockVenture, a research-driven alliance of funds and university blockchain groups that specializes in helping crypto startups go-to market. BlockVenture is an official business development partner of API3.

Motivation: The API3 University Governance Initiative is an academic focused program to inspire, advance, and evangelize the API3 Airnode and API3’s blockchain oracle solution.

Specification:

  1. BlockVenture will select up to ten university blockchain groups that are approved for delegation for a one year term and will provide a list of addresses owned by each group.
  2. API3’s Marketing Team will create a multisig for each university group.
  3. API3’s Marketing Team will borrow sufficient tokens from the treasury into a wallet, from which the tokens will be distributed in equal proportion to each of the multisigs.
  4. The multisigs will then stake the tokens into the governance contract and will delegate them to each of the provided addresses.
  5. API3’s Marketing Team will reimburse university groups for gas fees resulting from participation in governance.
  6. BlockVenture will create a rubric and will conduct quarterly reviews to ensure each university group fulfills their commitment as governance delegates as stated in the rubric. BlockVenture can remove a university group that is not meeting these requirements at any time. This rubric is included below and will be open-sourced by BlockVenture to the API3 Community.

Rubric:

  1. Each year by January 31st, the University Blockchain Group President must appoint a delegation consisting of two student representatives (one lead and one secretary) to serve on API3’s DAO Governance for a 1-year term. This appointment should be sent via email to BlockVenture.
  2. Each year by January 31st, the appointees must read the Bylaws of the API3 Foundation and schedule a video call with BlockVenture to confirm their understanding of their role in DAO governance. The appointees will need to agree to these bylaws and protect the Bylaws in their role as DAO delegates.
  3. Attend at least 80% of official governance meetings online and the secretary must keep an attendance log for the university delegation records.
  4. Participate in at least 80% of official governance votes in a timely manner and the secretary must keep a participation log for their university delegation records.
  5. Each quarter by the end of the last month, conduct a quarterly meeting with BlockVenture to review their delegation records.

Benefits: University blockchain groups are aligned in values and principles with API3 governance and these groups do not have a short-term profit motive. On the contrary, students are looking to participate and contribute to the success of a high profile crypto project in order to gain valuable experience prior to entering the highly competitive crypto job market. For this reason, university blockchain groups are highly incentivized to participate in all governance initiatives and only vote for those proposals that are of long term added-value to the API3 DAO.

Vote:

  • Vote For: Formalizes the DAO is “for” the details outlined in this proposal including all made points.
  • Vote Against: Formalizes the DAO is “against” the proposal including all made points.

For questions, comments or concerns on any of the above, please comment below.

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Looks good. Here is the IPFS. I’ll try to get it up for vote tomorrow.

This will be the first primary proposal in the authoritative DAO. @bbenligiray would you be so kind as to review the parameters before I submit to help ensure there are no mistakes? The differences I see from our typical grant proposals are:

  • Do a primary proposal instead of secondary
  • Use the API3 token contract address instead of USDC
  • Use 18 decimal places for API3 instead of 6 for USDC

Looks correct

Proposal is up for vote: https://bafybeihk4rqnrfp2qysmrvo2p6cdhwuswrvp53pubqmflyg4vziwluvp4y.ipfs.dweb.link/#/governance/primary-1

The 10 multisigs created for this will accumulate a lot of staking rewards even after the initial is unstaked and withdrawn. I still think that the university groups should manage a multisig and the marketing multisig should delegate to that multisig.

Is that a problem though? The 10 multisigs would require a core team member to sign to do anything with those rewards.

An alternative would be for the core team to entirely control the 10 multisigs and delegate to the university groups’ addresses. That would actually be less work for the marketing team since we wouldn’t have to confirm every vote and the university groups could then use any wallet they want.

If you need a WIIFM reason to vote yes for this proposal, having university groups participate in governance lends credibility to the project because those big name university brands will be associated with API3. And it costs the DAO nothing but a little gas, the DAO keeps the tokens and the staking rewards.

The problems with the 10 multisigs are (whether they are fully owned by the marketing team or not)

  • Everything is 10x more error-prone (for example the multisig owners should be checked individually) and the amount is significant
  • It costs 10x more gas to deploy the multisigs and vote
  • It’s 10x more difficult/expensive to collect the rewards and return them
  • It’s not scalable in that you can’t add or remove university groups easily

If there is an equivalent solution that doesn’t have these disadvantages, I don’t see why it wouldn’t be used.

Another point is that this deal should have an expiration date by which all tokens are to be returned to the DAO (the second version of the proposal doesn’t), and the DAO can renew it with another proposal. Currently the termination conditions are not clear and this risks them being arguable.

Everything is 10x more error-prone (for example the multisig owners should be checked individually) and the amount is significant

The option where the multisigs are owned by the marketing team solves this. We would delegate to the university groups’ addresses.

It costs 10x more gas to deploy the multisigs and vote

Agree and that’s not ideal but the more we decentralize the more this will be the case.

It’s 10x more difficult/expensive to collect the rewards and return them

Expensive yes. But not difficult if the marketing team owns the multisigs.

It’s not scalable in that you can’t add or remove university groups easily

Granting/revoking delegation is easy.

If there is an equivalent solution that doesn’t have these disadvantages, I don’t see why it wouldn’t be used.

What is the equivalent solution?

To me the best solution would be that all the tokens are kept in one multisig but we delegate in smaller amounts to the university groups. But as Midhav pointed out delegation is all or nothing. We can’t currently delegate fractions so we need 10 wallets to work around that.

I’m referring to [Primary Proposal 1] - Getting University Blockchain Groups Involved in Governance - #31 by bbenligiray

  • The marketing team stakes tokens through their multisig
  • The marketing team creates another multisig and assigns the addresses that represent individual university groups as multisig owners
  • The marketing team multisig delegates its voting power to the new multisig

The university group multisig is responsible with voting on proposals, adding or removing multisig owners as requested. If they don’t comply, you retract your delegation (and potentially delegate to a new multisig that doesn’t include bad actors).

This does require them to vote as a bloc, but I don’t see why this is not preferable.

I like this idea too - they can vote as a bloc/off-chain, and collectively they’d have more than enough voting power to make a stand on their own

I see. BlockVenture pointed out that if they vote off-chain it removes some of the incentive for the university groups because then they aren’t gaining experience directly participating in DAO governance. @ArielBlockVenture & @twellener should probably explain it in their own words.

A couple negative side effects I see are

  • It can deliver a different outcome if the block is evenly split on a close overall vote.
  • It kind of takes some of the fun/marketing benefit out of seeing university brand ENS names voting for/against proposals.

On the other hand I like the idea of being more gas efficient, which we get with a bloc.

Each group would still have to have a representative Ethereum address (which an ENS name can be associated with) and they would all have to confirm a multisig transaction and that is on-chain voting.

It can deliver a different outcome if the block is evenly split on a close overall vote.

It’s not obvious to me that this difference would not be for the better

To put it on record, there has been a lot of discussion on this proposal since voting went live.

The current thinking is that we would keep the whole fund in a single multisig wallet managed by the marketing team. This wallet would delegate to an address managed by BlockVenture. BlockVenture would organize off-chain voting amongst the university groups for each proposal using a polling tool, such as snapshot. Then a single vote would be cast in the API3 DAO for the university groups as a voting bloc.

This would be more gas efficient and make managing the tokens and staking rewards easier while still allowing the university groups to participate in governance.