Temperature Check - "Community Governed" DEX

Temperature Check
#1

Hey Everyone,

Sorry for somewhat spamming the governance forum.

I just wanted to share my thoughts on our governance system. We all know - as has been discussed in other forum posts - that we are never going to get anywhere unless we have a unique point of difference (USP) from the other major DEXes. We currently claim that our USP is true community governance, but we all know that’s not true.

So… my idea is that we drop the requirement for submitting a governance proposal to holding 0.001% of the WSE token supply, as opposed to the current 0.5%. This still represents 10000 WSE tokens, which at current swap price is nearly 300 USDT.

This would mean that anyone willing to put a few hundred dollars into WSE would be able to make a proposal - legitimate community governance.

However, we can’t just have everyone spamming proposals. So what we do is make it cost 10000 WSE to submit a proposal, instead of simply having to hold that amount. Now this WSE gets pooled, and paid out to wallets whose proposals are accepted! So not only can everyone participate, but you’ll get rewarded for positive contributions. It means not only is the community able to govern the platform, but they are incentivized to govern the platform.

It could create an entire governance ecosystem, where improving the platform becomes regulated and driven by the market. I’m not claiming that this would result in the best proposals being passed for the platform (although I suspect it would), but I am definitely claiming that it would give us a major point of difference and have the potential to attract a large user base.

Time for thoughts and feedback! :smiley:

On another note, the search engine result for WhiteSwap is broken. The title and descriptions fields have been replaced by meta.main.title and meta.main.description respectively. Hope this gets fixed asap.

#2

Don’t you think @gpne that there is still will be a lot of spam? Maybe we need to increase the price like to 20000 WSE? The proposal is actually really good, we just need to think about risks and what we can do to prevent it

#3

Hey @gpne how do you see the rewards? Is it going to be like a fixed price or maybe a precentage? I think fixed is better, but then how much? Are you just going to return your 10000 WSE? Or profit off of it?

#4

Hi @fablo. Not sure if there would be much spam, as there would be nothing to incentivize people submitting useless proposals? However, if there was spam that wouldn’t be a problem. You could have it so that proposals are sorted by how many yes votes they have, like an upvote system.

@powmyles I was originally thinking percentage, but fixed could work too. Fixed would be great cause the excess could go to the community (liquidity providers), but the issue is whether there would be enough failed proposals to provide enough rewards. You’d definitely want it to be profitable for accepted proposals - the whole point is to incentive innovation. If it was a percentage payout, the percentage you’d set would determine the ratio of successful/failed proposals necessary to guarantee a profit.

Maybe the best solution would be to set it as percentage but with a fixed minimum. I.e. an accepted proposal is guaranteed 20000 WSE or x% of the submission cost pool, whichever is greater. This could stimulate early participation while allowing the stakes to grow with engagement.

#5

Hello, interesting idea.

But I think we should discuss more about the right implementation of it.

For now, I see some things that could lead to bad exploitation of the feature.

As I understand we should make a pool of rewards for successful proposes from the community treasury to award proposers. Let it be x10 award multiplication.

Then an Attacker that has at least 4% of government power could start to farm WSE tokens.

The only protection community has is to vote against it. If we consider the community as distributed, then the cost of protection will be always higher than the cost of the attack, because start a proposal and vote for it requires only two transactions, but voting against it will require a community(let it be 1000 people for example) that makes 1000 transaction.

#6

Hey @GovardsDady.

Thanks for highlighting this issue.

How about implementing it offline, so that voting against a proposal would cost nothing? I.e. an off-chain voting platform such as the current snapshot, but where it costs WSE to submit proposals and successful proposals are rewarded.

The on-chain voting system would remain the same, and you would only be permitted to make an on-chain proposal if you pass off-chain.

Thoughts?

#7

To implement it right we need a censorship-resistance trusted third-party that collects all the votes, and then publishes proof that popolsal collected enough amount of off-chain votes to start on-chain voting. For now, there is no such technology exists.

However, I started to think that my first point about WSE farming is wrong. Because the Governance contract has access to the large community treasury, so this type of attack is possible in the current circumstances too.

#8

@GovardsDady

Sorry, my technical knowledge is lacking - what would stop it from being implementable on a platform like snapshot which is currently used for off-chain voting?

Given the 4% attack you mentioned, would it not be reasonable that [given a distributed community as you mentioned] one could assume that a malevolent attacker would struggle to acquire 4% of the governance power?

#9

Hi @gpne! We have looked through your proposal and we are very intrested in making this live! Right now we are working on the smart contracts changes that will represent your idea. Stay tuned, soon we’ll make new topic for proposal!