MakerDAO Issue Discussion, 15 Sep 2021

Previous Meeting

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From YouTube: Delegate Debates | #1 Delegate Compensation

Description

Initial poll about Delegate Compensation: https://forum.makerdao.com/t/delegate-compensation-informal-poll/10042
Follow-up poll by Joshua Pritikin: https://forum.makerdao.com/t/informal-poll-compensating-recognized-delegates-parameters/10196

MakerDAO Forum: https://forum.makerdao.com/
MakerDAO Chat: https://vote.makerdao.com/delegates?network=mainnet
MakerDAO Voting Portal: https://vote.makerdao.com/
MakerDAO Delegate Information: https://vote.makerdao.com/delegates?network=mainnet

Meet your Delegate Call #1: https://youtu.be/SVUm1Bz0U9A
Meet your Delegate Call #2: https://youtu.be/n4eILXWY_28
Meet your Delegate Call #3: https://youtu.be/PbdUe4diPjg
Meet your Delegate Call #4: https://youtu.be/Cm0Qy8PTEf0

Planet_X:
Forum - @Planet_X
Rocket Chat - @Planet_X

Frank Cruz (Flip Flap Flop):
Forum - @ElProgreso
Rocket Chat - @ElPro

Joshua Pritkin:
Forum - @Joshua_Pritikin
Rocket Chat - @JPritikin

Tim Black (tentatively):
Forum - @TWBlack88
Rocket Chat - @Tim.Black

A

All right, hey everybody, uh welcome to uh september 14th. First issue discussion call so hi. My name is david. I am the facilitator of the governance communications core unit here at maker dao and in line with our mandate. We are starting off an issue. Discussion call series uh in partnership with content production, so big shout out to jerry and seth, and whoever else worked on like the branding and like all the coordination, for the call appreciate you uh all right. So today's issue discussion is going to be about uh delegate compensation.

A

So, uh as many of you in the community know about a month ago, uh delegation was soft launched um which came with you know a portal in the voting ui, uh as well as a different portal, that kind of like tracks all the different delegate statistics, and also on the forum, a ton of uh delegation content has come to be so each of the recognized delegates, for example, post a delegate platform where they talk through themselves, uh how they intend to act as delegates and all that good stuff, uh and so as delegation evolves and kind of grows and matures.

A

The next big question on the community's mind is whether or not delegates should get compensated um and, and so there have been so far about three discussion- threads uh tim black one of our recognized delegates started us off with the initial one, um the uh yeah and so over the course of the last half a month. Three weeks I would say uh the conversation has been happening in the forums, and so today uh I'm gonna do a little bit of summarizing the issue.

A

uh There's also some call notes that I prepared for people uh they are publicly viewable, so feel free to check them out um and yeah. So let me take a pause here, um also yeah. Well, so let me take a pause here and breathe all right, so format of the call right. So let's talk about the format, so today we're gonna go through a bit of a brief overview of the topic and then we're gonna have an open-ended discussion with our panelists, uh which consist of delegates.

A

I think I think it's all delegates right or joshua uh are you? Are you also a delegate, or are you just a very active community member.

B

um No, I am not a delegate.

A

Okay, cool cool right on uh so mostly delegates, but we have some great panelists, some really really uh active community folks, uh and so let's get on it. uh So maybe it would help for me to actually share my screen just to talk through kind of like the topics view and so that you guys aren't bored just looking at my face. uh Can I get screen access should be good to go. Thank you very much yeah. So uh so, as you can see, there's there's quite a lot to talk about so from the topics view.

A

um These are the main kind of questions and different things that popped out so and notes that I've collected so I've collected, notes on you know voting yes reasons which, according to the informal poll, um I believe on tim's thread, there's about 75 percent of of those votes going for yes, and also we have voting no reasons with less of the community more 25. So the overall sentiment around the issue is that delegates should get paid, um but we can dive into the you know the nuances a little bit later.

A

um The other pertinent questions are like: how quickly should we move? I know joshua has expressed kind of frustration at the fact that this might take a while, given you know the requirements and the right way to get through the issue, then there's what's the fundamental role of the delegates.

A

So this is about kind of setting expectations for the role we already have a mkr holder's guide to delegation, as well as requirements for recognized delegates outlined, but some people in the community uh believe that the role of a delegate should really go above and beyond, um and so there's a bit of conversation between you know. Can we set kind of a floor expectation for the delegate and then anything beyond that they can seek compensation elsewhere?

A

That's kind of the gist of that question. The conversation happening around there then there's the question of what what actual metrics define a delegate's rating. Is it the amount of communication that they have? Is it you know? Is it the amount of mkr vote weight that they're assigned, uh and so there's a handful of views around that um then there's the question of how many recognized delegates is even enough.

A

uh So currently, I believe we have like seven or eight uh and I believe the idea like based on my comments, somebody mentioned 20 um there was pushback saying 20 is just way too crazy, especially if they're going to get paid so maybe like a top 10 is, is better and I think like between eight and ten. I think there was a vote about this as well um on one of the threads, so so yeah. How many recognizable gets is enough.

A

There's another question and I think the sweet spot is between eight and ten personally, but we can take a look at the results in a little bit. Then there's the question of conflicts of interest. How can delegates vote on you know, uh votes that include details about their own pay and their own. You know renumeration uh and there's there's definitely some points. There uh specifically long made a really good point about that. How there's numerous checks in place uh to prevent like abuse there, but we will.

A

We can uh come back to it in a little bit um then there's the question of where should delegates get paid from so like? Should they get paid from the people delegating or from the protocol as a whole? um This is, uh I decided to kind of skip this for time. We can come back to it at the end of the call, if somebody's really interested in diving into that, then there's the general topic of how much delegates get paid. uh They cur many people, not just delegates, get paid in source cred right now.

A

um You know that amounts to between like five hundred dollars to eighteen hundred dollars on the top end two thousand dollars on the top end per month. um You know: should delegates get paid a stipend beyond that, should they get executive level, salaries of 80k plus a year? You know 100k, plus a year. This is kind of also in the debate.

A

Then there's the question of actually how delegates should get paid. um You know, should they get paid and die, should they get paid in mkr? uh Should that mkr be? You know a cliff vested uh and also what smart kind of um things can we do to get delegates paid proportionally? You know, uh and it fits into the next point- right, active and flexible versus rigid and fixed delegation pay. So can we have unique pay scales for each delegate based on um their performance versus? Should we just pay the top 10 a flat rate?

A

um That's also in the discussion.

A

Then there is kind of some questions about. What's the difference between paying mcar voters generally I.e, the staking rewards that actually did not pass in governance versus paying delegates more specifically and yeah. There's. Definitely some some difference there and some nuance that people pointed out uh then there's a comment. You know can't we just use source cred, this kind of fits under the how much and how should delegates get paid? Should it be source?

A

Cred plus you know, plus something, or should they opt out of source cred if they are getting something like a salary or a larger stipend? um And then there's the general question, and we can we could skip this, but we can come back to it if we need to of how we can improve the overall delegate system.

A

So, um as long mentioned in in the uh in the forum actually highlighted it here bear with me uh yeah, we don't need to figure out the final form of delegation and governance, uh but we do need to make it improvements and mitigate any issues that we're seeing and that's kind of what we're doing here today. So um yeah, let's, let's get into it, and uh uh perhaps we can start off with uh you know what is the fi?

A

What's the fundamental role of the delegate, do you guys uh agree with the current uh minimal expectations being set? Should they be be revisited and I'm curious uh on everybody's view,.

C

A

So feel, free to take the floor, any of our panelists.

C

I'll start first, uh so I represent flip flop, flap delegate, uh llc, uh delaware company. uh My name is frank: cruz. I'm an akao progreso under forum on el pro on the rocket chat. So I think the um responsibility of a delegate is to have a fiduciary duty uh to mkr token holders and to and to do what's best for the maker dow for the protocol, um so even if it means going against your own belief. In my opinion, uh you have to follow.

C

What's again the best interest of the protocol, um that's my opinion, and I think that you know for someone like myself who's, a delegate, I'm looking to reiterate on what my voting process is. What my thinking is behind. What folks that are delegating to me want to happen.

C

But again the number one priority for me is the fiduciary duty to mkr token holders. That's the way. I view it and be interested to see what the other my co-peers think about this.

A

Yeah, that's very interesting. Nobody actually mentioned fiduciary duty at all in the comments from my reading. So it's it's interesting that you brought that up. uh Yeah anybody have a response or anything to add.

B

um What uh can I speak now? I I raised my hand, but yes,.

A

Yes, yes, absolutely.

B

Yeah, so um just kind of as part of the intro. uh The way I think about delegation is um for voting is uh it's kind of in the framework of um like the the um for the more information, the more informed that voters are, the better kind of results, you're gonna get uh from uh kind of voting. So um that's that's always a cons like I.

B

I've studied a lot about um kind of democracy and uh deliberation and and um stuff like that, and um I mean this uh maker dow is- is not exactly a democracy, because you know the um we're awaiting the votes by uh by maker weight, but uh I think in terms of the whether voters are informed.

B

It's like the is a kind of the most important thing for me and um so that that's that's really why I see it being advantageous to compensate delegates is because that'll give them kind of more motivation to become informed about the issues and have time to study the issues and that that's really the critical difference between you know.

B

If, if you have, if you have like a direct democracy of a whole bunch of people, voting, um not necessarily in maker dao, but um that's always a concern that you know you you just um people, don't know what they're voting about or you know they don't have a deep understanding of the issues.

B

They haven't deliberated on it and that's why you can get you know kind of bad outcomes and and people talk about mob rule, and uh um you know where you mean I mean you can you know, have a a big community that doesn't know what their hasn't really thought about the implications of what they're doing you know, vote for a lynching and go kill people, and uh so it's it's really important.

B

The the critical thing for me for um democracy is that voters should be as informed as possible about what they're voting on and really understand it had deliberated it deliberated on it in depth and that that's to me that's kind of what justifies the compensation.

A

Yeah that makes a lot of sense, and that falls in line with a lot of what I was reading on the forum. You know as planet x actually uh so beautifully said you know. Governance as a hobby has been stretched quite thin. You know, and it takes time and effort to ensure a good delegate performance which in theory should be compensated.

A

um Yeah yeah, I I hear all of that uh does.

B

A

Panelists have any any comments or anything to add to joshua's comments, yeah, it's difficult for us to measure and verify informedness yeah. So you know like uh when considering paying mkr uh stakers voters as a whole versus delegates.

A

uh I think that point that it's difficult to measure and verify and for informedness is kind of like the key, because, if you're paying mkr uh holders uh in general, uh you know there's no guarantee that these aren't kind of like mindless votes. People are just keeping it there for the yield, etc, etc.

A

But if, instead of doing that, you take a more focused approach and you pay, maybe the top. You know seven or eight or ten performing delegates. You get. You know a person in the community who is now incentivized to actually be as informed as you wish. You were, but unfortunately you have a day job and you don't you're not here at maker dao and I'm saying you as the small mcr holder who's actually delegating right, um but yeah yeah uh it is. It is very advantageous to have delegates in my opinion.

A

Just generally speaking, is there any? Is there any disagreement about that yeah? I didn't think so: um yeah cool, so maybe we can uh shift gears a little bit um and I actually realized that. I made a mistake uh before jumping into the first uh discussion. I wanted to actually quickly have everybody introduce themselves. I know it's a little bit out of order to do it now, but perhaps everybody who, who agreed to be on the panel can maybe say their name say who they are and then we can get back to uh discussing.

D

Yes, all right, I am planet x and uh I'm a delegate for uh for maker, um so I'm one of the the first ones going for delegation. So uh I'm not going to spend any long time introducing myself. So I'm just going to give it over to the next person.

C

D

Tim, you want to go.

E

I mean I was just just done: muting yeah, uh I'm tim black, also one of our first wave um delegates here at maker, dow, uh representing uh feed black loops, llc wyoming, so uh yeah really excited to be part of this conversation. um Sorry for poking the dragon on uh compensation, but I saw some of our delegates were working harder than others and harder than most and um that's why I started the conversation and now here we are to sort of hash out the rest of the details so happy to be here.

A

All right, frank, you're up.

C

Okay, uh so again, um frank cruz. I represent flip flop, flap delegate, llc inspired by maker, a smart contract language. I've been a community member now since early 2019 and really excited about being a delegate.

C

I have mixed feelings about the compensation structure, but you know I'm willing to work with the community to make sure that uh we do build something: that's a foundation for future dows and I think, there's going to be a lot of eyes just looking at us and trying to figure out how to do it, um how to get the governance, how to get delegates how to decentralize it and so yeah, there's no pressure, but uh we got to get this thing done right.

A

Yeah right on right on so yes, we had planet x, frank joshua, introduced himself a little bit ago and then to black yeah, all right, sweet uh all right. So as I'm looking through these call notes. It kind of strikes me that there is a lot to potentially discuss, so I want to open it up to uh our panelists uh planet, frank, joshua and tim. uh I want to ask each of you.

A

What do you think is the most important piece of getting this thing right or or what is the most important piece that you are personally focused on or concerned about, and maybe we could start with. Perhaps you want to take it planet.

D

Yeah sure, okay cool well. For me, the most important thing now is that we lay the foundation for further professional being more steadily going, the way of professionalization of maker.

D

um So when we, when we started here, most of us were hobbyists uh free agents, some did that work and some had day jobs, but as time has progressed, maker is getting bigger and bigger and is taking up more and more time one way of easily spotting. This is to go on the forum and just check any any discussion spread and then go back and check an old discussion thread from let's say a year ago, and you will find that the the threads are now much longer. There are more participants and there there's more.

D

The discussions are what you can call more abstract and they're more heavy, um and this also impacts the job of delegates, so the the um the work itself uh is becoming more difficult to follow and takes up more time.

D

So what I would like to see happen um is that we we agree on uh what a delegate should do more or less and from this this list of tasks. uh There is a a consumption of time plain and simple, and this time needs to be compensated.

D

There's of course, some gas costs and whatever for doing things. But that's not the major issue here.

D

The major issue is time, and uh what I'm thinking about is that most of us delegates in in the first wave, let's say in in a few years we will, we will probably have tired of being a delegate, possibly just like board members change, jobs and politicians get tired of doing their job and look for something else to do, and we need replacements, and I would like the the second wave of delegates to be really professional compared to the first wave yeah I would like to, and these people require pay plain and stable and it is um going to be exceedingly hard to or to convince.

D

uh You know really good professional people to do anything for free and that's why I would really like to see delegates getting paid now. The question is, of course, what should the delegate do and we will not find we will not agree on that in this meeting, uh but in general I would say that a delegate needs to spend something like 10 to 20 hours, something like that.

D

Possibly you know less for somebody's five for other people is 40, but you know 10 to 20 hours and and then get compensated as a professional would get compensated yeah. That was quite a speech.

A

Yeah, but I I hear that so you're after, like the increasing um quality of the people working at maker and if we can really like uh solidify our expectations for this professional delegate role, um that's going to attract those kinds of people in the next wave.

D

That is what I'm hoping yeah. That is the um the preferred outcome. Of course you you could say that there are very few things that that prepares you for a crypto job. So you know why: why pay professionals? uh That's the counter side to this argument, of course, but you have to start somewhere.

C

Taking the other side of that that opinion uh you have uh influencers like uh cooper, turley who's, uh um he's uh pretty much a delegate for all of crypto right, especially ethereum, and you see when you see a young guy like that, going out and posting on twitter that he's uh not only doing this full-time but he's also getting paid in dow tokens governance tokens.

C

uh You know I can only think about like a lot of young people that are up and coming that are going to want to do this and they're not going to be sneaking professionally facilities.

C

They can excuse me, delegate facilities, they're, going to be just individuals like you and I, and um I think that you're going to see a lot of this happen because, as you can see, right now, there's a lot of dallas forming with just individuals that are just in the grind and they're, creating these dowels, whether it's nft dao or it's some type of dao- that I can't yet understand it's happening and when you see it again, people people like cooper, tweeting out like this and telling the young generation that you know he's gonna get paid in governance tokens.

C

It's gonna happen and I don't know if it's going to happen with professionals or you know just everyday people like us, but um I think you got to give both sides. You know an opportunity and yeah. You have to compensate somehow, in my opinion,.

A

So so frank uh to summarize kind of like what you feel is most important. It's uh it's really like. Yes, like compensation, obviously, but for you it's more about giving the delegates actual. um You know, stake in maker da right pay them in governance. Tokens not die. um Am I getting that right.

C

No, no, not necessarily um either. For me, it's either way. Personally, uh uh you know running a delegate company, I'm obviously gonna have some expenditures. um Some of those are gonna, be obviously the obvious one which is gonna, be voting um spending some if right spending gas, um the other things that I personally want to do, and I'm pretty sure some of the other delegates are thinking of doing this.

C

Going to um some of these great conventions that are coming up, you know meeting some people um learning what the entire community and ethereum, and maybe others too, since it's becoming a cross-chain world learning what they're thinking and then bringing that back to the maker community and communicating with them.

C

So these are all expenses that I'm going to be inheriting on my own and I'm cool with that, because I'm passionate about this, but as far as your question, whether we should get paid in mkr or die, it's the same thing um more than likely for me, since some of it is going to be expenses, I guess I would lean more towards die, because I have a hard time getting rid of mkr.

C

uh It's easier for me to spend die because it's meant to be spent, um so I I think I would need more for dye, but you know um yeah, you know if I could, if I could be like cooper and just hold on to all my uh tokens. I don't know what his situation is, but uh I would but um I'm pretty sure he has some expenses like all of us. Do.

A

um Yeah yeah right on, uh so let me extend the initial question and for those of you who had joined us just recently, so the question is: um there's a ton to talk about uh of all of the things to talk about. What do you find to be the most important piece of the issue that you have either a strong opinion on that you want to make sure is, gets gotten right uh and then yeah we're kind of just free flowing from whoever's answer from there. So tim you want to take a stab at it.

B

um Yeah, uh so the I guess, the most important thing to me is like kind of getting to uh a step, one kind of proposal that we we all kind of, feel reasonably comfortable with, and so we can get. We can get delegates start getting paid like you know, I I don't want to see this dragged out for for months and months as we negotiate details.

B

So you know I I wanna. I want a good starting point, um but I don't want to get too hung up on uh trying to make it perfect from day one.

A

Yeah yeah, I hear that desire for sure, and actually maybe long can speak to this, but or maybe I could just summarize it, but uh on the forum there's there's kind of like a a couple of different things.

A

We could do so while, like the fuller mip with the whole formal process going, you know through, like signal requests into like the whole mip uh before that's done, uh it's possible to do a kind of like time limited trial, uh and so we would, you know, use the formula or a version of the formula that uh you provided joshua and, like you know, we do it all kind of off chain and manually, and we, you know, get the payments out through a governance vote and this is kind of like the interim solution to at least get um delegates compensated.

A

You know something as soon as possible right uh and then, as like a more formal uh uh proposal comes about. We can really sharpen it and see like where the holes are and- and we can use that little pilot program to inform us right. uh So that's like one option for getting it uh really off the ground. I'm curious if any, but if, if longer anyone wants to color that with more info.

F

Yeah, just to clarify, I did say we should someone should write the mip um as well before we actually might sort of do the trial right, because um it's important that we sort of everyone clearly understands. What's going to happen during the trial right and mips, the mip format is kind of good, for you know, sort of making sure you describe like each part of the thing how everything's going to work step by step um better than like a forum before I'm posting um so so yeah.

F

I don't think we need to like pass on it, but I would like to see one or someone write something up right that actually sort of covers all the you know how we actually do the transfers like who is eligible. Why are they eligible et cetera.

A

Yeah, I uh I threw in some notes there like for, like the fuller process, uh you know pulls like the three different informal pull threads that we've seen help with community sentiment. You know they greatly greatly helped me in putting together the call notes. There was an absolute ton of great information and actually a ton of like back and forth conversation that led to agreement which, uh which I see everybody is kind of like moving towards a very similar direction, um slowly but surely uh but yeah. So what would the next step be?

A

Would it be uh um like, for the time limited trial? I mean long like? How would somebody try to kick that off.

E

um I'll take that so I sort of capped the latest voting thread with, like the topics and the parameters that we sort of need. I think we've actually voted on most of them, and so I think the next step is really just formalizing it into a myth and writing it down and and then working with gov alpha to make sure we didn't miss any holes, I guess and the rest of the community to make sure it's all covered um and then just being very clear in that language.

E

To say this is a trial map for this period. For the first stage of this is three months, and then we re-evaluate it or something um that's why I made that whimsical thing, because I just have to make it visual. I can't think things through like entirely in like 20 page documents, so um I think that's sort of the next.

E

The next step there.

A

C

Kind of like it's kind of like landing on the moon right, you land once and you don't just say: hey, I got it. You got to keep uh you're iterating right like so same thing. For uh that crazy climber who climbed uh our cap, I think it's called.

D

G

C

Yes, alex donald he had to, he had to do it ten thousand times uh to do it without with ten thousand times with a rope to do it once without a rope which is bananas, so I don't know how he did that, but um yeah that's that's kind of like, I think the approach we have to have here and um yeah. I I'm bold for this three-month uh trial thing here. Personally, I don't know how the other uh planet x, how you feel about that?

C

um I'm not sure if I saw any comments on that from you.

D

Oh well, I think three months is fine. um Excellent. Two months.

A

So do we have a commitment on who's going to draft the signal thread.

F

A

Joking to ah oh, okay, all right, so I I was reading it like yeah. You could do a signal thread outlining the the um the project and then the mip is an rfc for like the fuller program, not for the time limited thing.

F

Yeah the mip process would happen after the signal threat, but there needs to be like written beforehand. So we know like what we're trying right: okay, yeah yeah, that does.

A

Make sense in terms.

F

Of who wants to do it like, um like I'm, happy to work with anyone or any group to make it right to try and cover the cover any like gaps or holes or anything so yeah.

B

Yeah I mean I, I could start working on the myth.

A

All right, so let us uh move on to a different um area of discussion around this topic. So uh I think so one of the most kind of controversial um pieces of this is how much delegates should get paid. So there were options ranging from you know nothing all the way to you know: 100k plus, executive salaries um and and also there's suggestions on you know how should we start should we start high and then move lower? If that's not what we want, or should we start low and move higher um kind of?

A

What's the idea uh and I'm curious, if uh um I I know that, like the majority of the voters in the informal polls, actually ended up going for like the 4 to 5k options proportionally, but there was a lot of variance. So I'm curious about your views on how much delegates should get paid um yeah and, let's start off with perhaps uh frank or tim.

C

Oof, that's a tough question. All right.

A

Frank beat you to it.

C

I tell you if you have a better opinion than I do, go go for it.

E

Yeah, I would just signal, request it and defer to the community. They already told us what they want right, and so you it'd be one of those things where it's like you're writing the mip and there's the placeholder for like ideal amount right. We have the spreadsheet, it's really elegant, it's very simple: it sort of puts that stuff in there, and so that's just like the last thing you're multiplying by and like, I think, that's sort of the last signal request is like what is the range we think is acceptable right.

E

um I think where we got kind of caught or went off in a circle was just like how much the time commitment is- and I think we've all learned as delegates from this process that like it, could be full-time, but it wasn't really supposed to be, but it could be, and so I think that's one of those questions. We just ask everyone else. That's a hive of my decision. Basically,.

A

Now that I repeated myself, I mean that that's kind of like uh when I was reading everything I kind of like the idea of having like a minimum default delegate and perhaps like you know, you can have like a bottom of the range compensation package for that person. But then you have people that are way more active, like planet x or paper imperium uh who perhaps can command like a higher a higher comp um and, like you know, merocratically, so uh so so yeah. I hear that uh and I'm just catching up on the chat.

A

Anybody feel free to uh jump in and comment.

F

I mean I can say that recording um like, I think, from governor's point of view, we'd be more comfortable starting lower and moving upwards than the reverse right, like I think it's gonna be very difficult for any decrease in delegate payment to ever pass, given that the delegates would need to vote for it themselves right.

F

um So I don't much prefer if we start that way, rather than rather than sort of start high.

A

Yeah, that makes sense- and actually, like um you just mentioned uh something that I would love for you to expand upon and that's kind of the conflict of interest of voting for your own pay, and I know that you wrote out a few, uh like kind of like a checklist of natural checks in place to prevent abuse. um Do you want to talk through that? A bit.

F

Yeah I mean there's a few options right like um okay, I guess the main, the kind of other group that has power, then that make a dao that isn't the delegates is the core unit for sales leaders right. um So one thing one option is to say in the mip that, like only uh queen of facilitators, can create proposals to adjust delegates pay.

F

For example, um like I absent some sort of kind of commitment to something like that in the mip um it's kind of on, I guess gov alpha to kind of make sure that the actual maker holders are informed when the delegates are, you know trying to adjust their pay in some way such that they have a chance to like block that proposal, um which is doable but is potentially a lot of work right, because a lot of the people that are delegating kind of don't want to be actually involved in themselves.

F

A

Also also there's the idea that, like right, if it's on a if it's on a formula, that's tied to like some automatically tracked like metrics, uh they don't have to vote on their pay. It's kind of like voting on the formula rather than an individual pay scale.

F

Yeah but there's always.

A

Going to be input.

F

To the formula right like, which can be higher or lower like they'll, be like or they'll, be like a total which is split between the delegates or like uh base pay that'll be input into the formula like they'll, always be you like the device always be, or they can just change. The formula right like there's, always a way for the delegates to wear themselves.

A

If they want to so essentially gov alpha acts as like a watchdog over this particular uh unavoidable conflict of interest.

F

Yeah, but it gets a little bit tricky right, because you know it's if it comes down to like about like trying to block a proposal that we think is ridiculous, then that causes like a whole bunch of problems right because you know by whose metric is it ridiculous? The delegates, obviously don't think so otherwise wouldn't be proposing it, like um maybe governor, thinks it's it's it's too high, maybe like some of the queen, don't like it's not a big argument right.

A

I mean it sounds like a typical, like uh campaign against any proposal that seems, like um you know, bad or something you know it doesn't. Maybe it doesn't even necessarily have to be alpha right like it can be anybody like. Oh hey. I noticed that this this and that- and this makes no sense because of this this and that and here's a signal request. If you agree with me. Oh yes, you disagree with me.

A

Vote no and show me why you know something like that right, but it's essentially like the same thing, but you guys are just claiming sort of that. You know priority responsibility, for we will definitely be looking after this.

F

It's more just like other people, like other community members, don't like have any like um like concrete power to stop it right. Yeah people can complain and sort of do signal requests, but they can't like like unless come out for, like sort of says, like no we're not voting on this proposal, then like there's nothing to stop any professor going through, at which point the delegates can vote for unchained, and presumably they have um yeah sort of command to the power to pass any proposal yeah.

F

So it's tricky like I'm, not anticipating any immediate problems. Right, um like none of the delegates have struck me thus far, is sort of super uh problematic in this regard right, um but it is something we need to kind of pay attention to as we sort of move forwards right, because that may always be the case.

A

Yeah, absolutely absolutely.

A

um I am curious about uh this this one. Actually, besides voting for your own pay as a delegate, are there any other vote types that would be a conflict of interest?

A

um I'm curious if anybody's thought of any, because that's really the only one I've seen mentioned so far besides, I guess like if you, if you're a large asset holder of something voting on like those fault parameters but you're. You know if you're, not part of the pp, you know parameter proposal group, then I don't know I feel like you're far enough removed that you could vote, but I don't know, go for it. There's potentially.

F

A lot of stuff right, like um you, know whether it's sort of just like changing the governance structure in any in any way right could potentially be a way to like gather themselves, more power right for the targets um like yeah. There's lots of.

B

Conflict of interest, but there's lots of.

A

F

Attack directors, I guess, is this: maybe it's a better way, but.

A

There's a lot of things that they could vote on for their own benefit um versus, like the benefit of the protocol as a whole.

F

uh Yeah, more or less, and it depends on my makeovers, paying attention.

B

Enough attention right.

F

Or the rest of the community are able to sort of bring make all this attention to those votes before they before.

A

Yeah all right, my brain is kind of going off topic because I want to ask more general delegate stuff, but I'm going to reign myself in and kind of bring us back to the compensation question. um So we just briefly talked about kind of the conflicts of interest for voting for your own pay and kind of the checks in place. uh Even before that we kind of talked about the fundamental role of the delegate, how much delegates she get paid.

A

I'm curious um I'm curious to see if there are any topics that came out of our previous conversations that anybody here would like to focus on and if not I'll kind of, throw out a new, fresh, prompt, all right cool, so new, fresh prompt. It is um so I'm curious about uh people's views on whether or not um delegates should continue to get paid by source cred, regardless of what their um additional compensation would be versus not getting paid by source cred and getting that compensation.

G

I kind of threw an idea in there. I don't know if it's been floated in the comments.

A

Oh, can you introduce yourself really quick.

G

Hi everyone, uh if nobody knows me, I'm andrew bourbon, uh soon to be hopefully should post facilitator for you guys um but yeah. I joined late for this call, and um uh so this is just my idea. I had about you know compensation so um so uh compensation, just like just knee-jerk thought, like so above some fresh minimum threshold.

G

Let's say you have 50 or 100 maker delegated to you. You qualify for some base, pay right and you know if you only have like too little. You know I don't know how that will be defined. um You know, maybe you weren't qualified to be a delegate or just not yet or something like that, and then um more.

E

G

That grows asymptotically with uh how much how much make or logarithmically right um whatever like approaches, some like sort of limit on how much compensation you get right. So um that sort of idea- I don't know if it's a a good idea. No, it's not linear tim.

A

So, actually so, actually yeah so joshua put forth a really interesting equation that him and long kind of like went back and and iterated on. uh Do you two want to talk a little bit about uh what you have yeah sure, because.

G

It's similar to what you're saying bourbon.

A

It's just a bit more like refined and I think yeah. It was mostly joshua.

B

Yeah, so the the idea is actually um inspired by a post from vitalik a few um months or years ago.

B

I forgot exactly when he posted, but um the idea is that you, uh it's kind of um related to quadratic voting in that you're um in this case you're taking a square root, but uh like it's, it's a like a power of two or a power of one half in this case and uh and then you allocate compensation in proportion to um the square root of how much maker is delegated um and then the spreadsheet there's there's some extra things we threw in there uh to.

B

um You know to um distribute the pay um like there's um like that. There's, if you suppose you have like. Currently, we have like uh two delegates with uh 20 20 000 maker delegated, and um it's there probably isn't that much difference in you know between those two delegates. So we we're just gonna put a cap of um you know any any maker beyond uh some. Some threshold is just treated as the maximum and then that way we can distribute it across more distribute the compensation across more delegates.

B

So that's that's pretty much. um What so like um andrew you're talking about kind of a logarithmic curve and that that's uh square root is kind of similar to logarithmic yeah.

G

B

G

Yeah, that's actually.

B

G

Similar, it may be logarithmic square root, um but I think one of the important things is a base pay. So, like you, don't start at zero. So like some base above you know, if you.

A

So question for you bourbon what would be like the criteria for awarding this base pay? Would.

E

It be a minimum.

A

Amount of mkr weight would it be also like the requirement for yeah the whole gambit of the recognized delegate.

G

So I mean for me, it will be. You know I mean my first thought is how much maker was delegated to you. So you know everyone could be deciding. Maybe it's 25, it's 50., I think. uh Definitely above 100 maker, like you, know, you're pushing the needle, like you know somewhat in one degree or another and you're going to be putting in some amount of work, um possibly consistent with everybody else right.

G

So everyone, above some threshold of you, know make your delegated to them, should be getting uh some kind of base pay and then begins the uh you know um uh the square root uh approach for a logarithmic, or you know, or some some cap, that we approach uh asymptotically right. So that, like you know just because you have you, know two orders more make or delegated to.

C

G

You're not necessarily doing two orders more work, uh you are you know, but you like you, maybe deserve more slightly more compensation for whatever it is right, but um I think most importantly, you start with some base base amount for anyone that is above a threshold if you're not above a threshold, I think maybe you could still be delegated to and you can still vote, but you're not maybe eligible for compensation until you can yeah until you can sway enough maker to delegate to you right um because uh maybe as it stands, uh anyone could just sort of like uh this could be gamed a little bit actually right, because I suppose I I can delegate myself right anonymously and throw my maker right.

G

So I don't want to so I guess you would have to have the delegated amount of maker and also uh meet some sort of uh key points or whatever just uh again performance points to also qualify for the thing right. You can't just just be delegated enough maker and then just not participate right like you have to also be you know, visible vocal, even if you're anonymous like.

C

G

You have to be participating right so right how that would be, but I think that um the important thing is there is some base pay that is constant for all and then above that it just you know, grows which is very similar to what joshua said so.

A

Do you um do you or anybody um disagree with the idea of having a total cap of uh die or mkr value, distributed to the to delegates, and then also um do you disagree that there should be like a cap on how many delegates get paid like top 10 versus all of them? um Yeah.

G

A

I think seth has uh has, might have a comment andrew you want to give it to him for a moment.

E

What's up y'all? um Well, one thing I wanted to throw in: I I'm not opposed to the idea, I'm not necessarily opposed to the idea of a cat, but um I just want to say if, however, it works out I'd like to see a minimum as well, I think an important part of this is that we don't want our delegates to worry about the costs associated with voting.

E

um You know we want. We want them voting, we don't want them worrying about how much it's going to cost them, and even if they're, relatively minor delegates, I think whatever the minimum pay is, should be enough that you know, even if it's costing us a few hundred dollars a week or 100, you know whatever's, realistic, 100, bucks, a vote or something um that they're they're that even like uh the smallest delegate, is not worried about doing so. So that's the two cents I want to throw in.

A

So that actually brings up like a bigger thing, so gas refunds as a program like not just to delegates but also to you, know, past voters with, like maybe a vote weight of like one mkr, plus or half an mkr plus so that we can't get like spam attacked. But whatever like something like a gas rebate program, I don't think anybody has um disagreed.

A

I think the main thing is that people think it will be gamed, but you can actually design it so that it's not game, like you know doing those you know you're not going to get reimbursed your gas. If you voted with less than half an mkr, you know so uh there's ways to design a system, but I I definitely agree at a minimum expenses should definitely be compensated for yeah.

D

You might also want to uh to put in a roof there a maximum. Now it sounds a bit illogical that I'm arguing for a maximum is.

A

This is this hold on. Is this a maximum for the total delegate pay, uh or is this a maximum for the uh we're already off the heath conversation right? Okay, we're talking about delicate pay! I could tell by your facial expression all.

D

A

Okay, cool yeah.

D

Yeah we're totally talking about delegate pay and there could be uh in the relative near future um that the uh the staking of of mkr and the governance contract could be incentivized, and you know when things are incentivized in crypto. You know things uh tend to happen, and um so, in order for the the delegate paid to stay at a normal, you know normal level. um Then there should be some kind of roof. On the on the conversation.

A

Yeah, I I agree with that view and long for wisdom actually wrote in chat. Having a maximum per delegate makes sense having it unlimited encourages centralization.

A

D

Yeah, I agree to that.

F

C

So going back to your earlier question david that you asked if we should still receive source, correct um it'd be nice to get a paper's opinion on here too. I think he's on the call, because him and I have one of the highest source. uh What do you call that cred credit score or something yeah credit score so right? So uh I think it from my opinion and I'll.

C

Let him go uh real, quick because we're running out of time, but I think it depends on the uh the pay that we're going to get right if we're just getting a snip in of uh 500 die. I think we should keep the the source cred. But if you know, if it's something that's a lot more than that then yeah but paper. I don't know if you're able to comment.

A

Chris cameron, while paper uh gets something.

E

Yeah, sorry about that yeah yeah yeah, so uh I don't have strong opinions about how the pay is delivered through what program it's more about getting paid.

E

So I mean to put this in context as the one who kind of badgered him into maybe starting this conversation earlier than maybe we were prepared for you know so, like I was sitting in, I took a call from a protocol about three weeks ago and I typically believe that words are cheap, so you know why not use them, uh and you know I was sitting on the call with them and they're like well. What does maker pay you?

E

What would we have to be, and I was like well for this kind of thing- they don't pay me anything they're like well, don't they see the value that you're delivering, which has got to be more than zero? And you know it was hard to have a response to that. So um I you know whether that comes through source cred or through some formal delegate. Pay really is something I'm agnostic about. I will say: source cred, probably does not capture a lot of the activities that I do um off forum, which you know.

E

Maybe that's fine, um but uh I I would say I don't care what the line items look like it's more about the bottom line.

C

Yeah and just just to add to the part where you don't have an answer, when you tell people that you get zero zero pay for this, uh you know try telling that to your partner or girlfriend or wife, uh pretty tough, to explain to them. Why you're spending, sometimes till you know, 7.

E

P.M, you know I've also. I mean this week. I've had three protocols reach out to see if I was interested in working for them like either. You know in a part-time, you know advisory role, but you know everyone has the same time endowment of 24 hours a day, so I'm not going anywhere I'm here for maker, but you know like I I do have to like not come home with nothing.

A

Yeah I hear that and that's a a great note to actually end the call on uh so we are about at the top of the hour. I'm gonna give it. I don't know I I I kind of feel like people have comments that they want to let them throughout.

G

A

Let me wrap up the call I'll I'll, stop the recording and then uh feel free to continue on, but I definitely yeah I have to drop. Unfortunately, uh this was an extremely interesting call. I want to thank our our panelists and also the others who chimed in on the conversation seth andrew. You know paper long. um All of you guys thank you so much for engaging in this and discussing uh and I'm excited to get delegates paid.

A

um That's my personal view, speaking as an mkr holder, um but yeah, it's gonna be interesting, seeing all the details uh get hashed out. uh So thank you all. I.

G

Plugged in one thought before you stop recording.

A

Yeah yeah sure uh before.

G

A

Stop recording.

G

Yeah before you delegate, compensation uh income is taxed, really not favorably in the us, uh but if we just have um a portion of the compensation to cover expenditures like travel, whatever, that's not going to be taxable that's going to be just covering business expenses and then the rest of the compensation would.

B

G

Options on mkr of some kind or some sort of structure like that which are not taxed not taxed as income, but taxed, possibly as a capital gain of sorts, uh which is a more favorable tax structure, so whoever might be open to that type of compensation.

G

uh I think this would be a more favorable for a tax structure.

A

G

uh I don't know if anyone's open to that, but that was my thought.

A

Yeah, I think the way that delegates get paid is going to be interesting because there was already the conversation of you know die versus mkr, and then this is already getting into like the real weeds. I would love to see a program where you know delegates kind of have a choice um but yeah right on thanks for that ending comment uh and with that um cheers, everyone have a good day.