👨🔬 Governance Lab #065
Lab Report #065 - Compound DAO Attack, DELV Services, Jupiter Token Reduction, and more
gm. welcome back to the Governance Lab, your weekly source for all things StableLab, DeFi, and DAO Governance.
We had quite an eventful week in the world of DAO governance with an attempted governance hostile takeover of a blue chip DeFi protocol. CT loves to chime in when things go awry or don’t work in the land of DAO governance. Lots of narratives were spun this week. Enjoy your dose of drama and beyond.
At a Glance 👀
🥩 Compound DAO discusses new staking product to address governance concerns
💼 Element DAO proposes service for yield sources onboarding and multi-chain deployment
🪐 Jupiter DAO proposes token supply reduction
✍️ New Blogpost - Quorum: Theory and Application to DAO Governance
Let’s dive in 🏊
Staking and Attacking
Compound DAO discusses activating COMP staking to address recent governance attack
The Compound community is considering a proposal to launch a COMP staking product as a peace treaty with Humpy, a prominent whale who recently attempted a controversial governance attack on the protocol. On July 28th, Proposal 289 by Humpy was approved in a highly contentious manner. The vote was initially expected to fail and was widely seen as an attack by many in the Compound community. However, at the last minute, a huge influx of For votes pushed the proposal over the threshold, securing a victory for Humpy. The proposal aimed to transfer 499,000 COMP to a vault controlled by the Golden Boys.
After the vote was approved, Alpha Growth published a staking proposal in hopes of finding a middle ground. They aimed for Humpy to agree to cancel Proposal 289, which he did shortly after. The Compound community has mostly embraced or at least been receptive to the idea, seeing it as a way forward. Others in the broader ecosystem praised Humpy and his cohorts for pushing through something many governance tokens want: yield. Some concerns about the future of Compound governance still hold as Humpy and his cohorts now control a large amount of delegation.
StableLab, as part of the Compound Governance Support Working Group, had already developed governance changes to mitigate this attack vector. Proposed changes to make Compound governance more robust and secure are expected to be published soon.
Onboarding and Deployment
Element DAO votes on DELV service agreement for yield sources onboarding and multi-chain deployment
The DELV team has submitted a proposal to the Element DAO to enter into a formal service engagement with the DAO, helping deploy additional yield sources and launch new Hyperdrive instances on additional chains and L2s.
DELV’s Scope of Work includes:
Onboarding new yield sources to Element Finance, such as ezETH, rETH, sUSDe, and others
Deploying Element Finance to new chains and L2s, including Arbitrum, Optimism, and Base
Maintaining deployed instances and providing technical support
The proposal requests compensation of 100,000 ELFI tokens per deployer coordinator. DELV will be paid only upon completion of each deployment. It is currently being voted on in Snapshot and will conclude on the 6th of August.
Reducing and Addressing
Jupiter (JUP) proposes 30% token supply reduction for enhanced certainty
Jupiter DAO is voting on a proposal to reduce its token supply from 10B to 7B JUP tokens, a 30% decrease. The proposal has been brought forward to address community concerns about the project’s high FDV and potential future emissions.
Key aspects of the proposed reduction include:
Following the 50/50 principle: 1.5B tokens burnt from team-managed portion, 1.5B from community portion
Team voluntarily reducing 30% from their assigned allocation
30% reduction in Jupuary emissions
Reductions in LP Needs, Strategic Reserve, and Community needs
The proposal is considered the first part of three JUP-related votes to enhance certainty, alignment, and transparency (CAT) for JUP holders.
❲ Links ❳
🚀 Launches & Deployments
Eclipse Mainnet is open
Movement Testnet is live
Introducing Irys
Introducing CyberDAO
Introducing deUSD a decentralized US Dollar
📑 Insights & Reports
Humpty Dumpty Took Over a DAO
Wintermute DeFi Governance Digest: July 2024 | Week 5
Arbitrum M&A Pilot Phase Outcome
🧗 Milestones & Updates
Aave July Funding Update
Aave Labs Development Update 1
Gitcoin H2 Budget Proposal Grants Labs
Gitcoin DAO Financial Report - June 2024
🗞️ Miscellaneous
Arbitrum DAO Change Arbitrum Expansion Program to allow deployments of new Orbit chains on any blockchain
MakerDAO Improved Accessibility Reward
📺 Podcasts & Listens
Compound Governance Attack! w Bryan Colligan of Alpha Growth
❲ Proposal Tracker ❳
💬 DISCUSSION | Aave - Merit Base Incentives and Superfest Matching
Summary: This proposal aims to implement an incentive program on Base network to increase Aave's market share and match additional incentives from the Optimism Foundation. The proposal will add Base to Merit boosters for round 7 and include matching incentives up to 150k OP, paid in GHO. With this, the proposal seeks to strengthen Aave's position on Base.
💬 DISCUSSION | GMX - GMX Governance Committee
Summary: This proposal seeks to establish a five-member GMX Governance Committee to formalize GMX's governance structure due to receiving 8M ARB tokens from Arbitrum DAO. The committee will represent GMX in Arbitrum governance, provide community updates, and collaborate with ecosystem members. Its members will receive a $1000 monthly honorarium, with yearly elections planned for all positions.
💬 DISCUSSION | Arbitrum - Incentives Detox Proposal
Summary: This proposal suggests a 3-month pause on new Arbitrum incentive programs starting September 17, 2024, to analyze previous program data and design a long-term incentive framework. The proposal is gathering feedback in the forums and will move to a Snapshot vote on August 1, 2024.
From the Lab
Blog - Quorum: Theory and Application to DAO Governance
In our latest blog, we explore a simple yet complex topic: Quorum. Learn about its history, significance, and implementation in DAO governance.
▶︎ Read the blog post HERE
❲ Our Voting ❳
📆 July 26th → August 1st | 🗳️ Total Votes: 24
See our full vote history and detailed rationale HERE.
Meme
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