We are grateful for all your feedback, especially those of you who took the time to write well-considered counterproposals and observations about the measures for this governance period. We agree on the importance of having a healthy dialogue with the community on governance measures, and we are committed to improving in this area going forward.
You gave us 3000 submissions - including comments, upvotes, views, and likes - to our posts on the Algorand Forum and the Algorand Official subreddit with suggestions and positive and negative sentiments about all measures. Thank you!
After two weeks of lively discussions and careful deliberation, we have consolidated and taken on board your many disparate views on how to frame voting questions. Based on this feedback, we are amending two proposals: Measure 2 to allow the community to vote down a fund allocation for xGov’s distribution and Measure 4 to allow the community to vote down a fund allocation for the NFT Collection. Elaboration of the revised Governance Period 5 Measures is below:
— First Measure <<< This measure has been updated >>> See latest post here
Governance Rewards
During 2022, it became clear that a high yield in General Governance was inhibiting the growth of our DeFi ecosystem. Well-considered community comments called for the complete removal of General Governance rewards so that such funds might be available for more productive use. On the flip side, others argued that reducing non-participation governance rewards with immediate effect - from 70.5MM Algo per quarter to zero - could run the risk of destabilizing the ecosystem, with potentially unintended consequences.
We agree we need to continuously examine incentive mechanisms and be diligent stewards of foundation resources. Therefore, the proposed measure represents a compromise between the 2022 rewards regime and those of the opinion that paying general governance rewards is wasteful.
At the last governance period, the community approved the redirection of 7MM Algos DeFi rewards for Q4 2022. We have observed the positive impact that this change has affected, especially in present market conditions, and therefore see value in both restating support for DeFi as well as providing a route for the community to (again) redirect a portion of general governance rewards to DeFi, should it wish to do so.
Therefore, taking the above points together, Measure 1:
- Materially reduces the overall level of rewards emissions, from 70.5MM to 45MM Algos per quarter
- Only allocates rewards for the next two periods (versus the entire year of 2022). That will give time to assess the impacts of reducing General Governance rewards and redirecting resources, without locking in the incentive mechanism for a longer term, should it prove to be suboptimal.
- Provides an instrument for the community to allocate 10MM Algos of incentives between (1) DeFi participation and (2) general soft locking and voting.
In subsequent governance periods, we look forward to broadening the scope of ecosystem participants who can receive incentive rewards, including node operators, oracles and other infrastructure providers.
Tl;dr;
The reviewed Measure 1 asks governors to vote on allocating the extra 10MM Algos to either General Governance or DeFi rewards. This measure does not include a “No” vote.
— Second and Third Measures
Previously Measure 2
The initial Measure 2 offered a choice between 1MM or 2MM Algos to be allocated for a Community Grant pilot program to be moderated by the xGov.
Community feedback on this measure converged around the lack of an option to decline this allocation altogether, as well as two main themes:
- Lack of clarity around xGov implementation; and
- Allocation size.
These are fair observations, and we would like to provide more context.
xGov implementation
Work on an xGov ARC is underway and we expect to release a draft for comment in the weeks following Decipher. The public discussion phase will aim to gather your feedback to fine-tune the design and implementation timeline for the program.
Allocation Size
Our intent with this measure is to provide an allocation big enough to be meaningful and generate community engagement, without unduly risking resources on what will initially be an early-stage MVP implementation.
Should the implementation prove successful, we anticipate bringing further measures to expand the scope of this program in the future, allowing the xGov program the ability to upvote projects that foster the growth of the ecosystem.
Tl;dr;
Measure 2 asks governors whether or not we should allocate funds to the xGov community grants pilot program. Then, in Measure 3, governors vote on whether to allocate 1MM or 2MM Algos for the MVP. Measure 3 is only relevant if Measure 2 is passed.
—— Fourth and Fifth Measures
Previously Measure 3.
After reviewing feedback around this measure - extensive, despite the relatively lower amount of resources involved - we would like to clarify the proposal and restate the rationale for the Algorand NFT collection.
First, we should state that the term “NFT” is broad, and is conceived of as covering the full range of Algorand NFTs - from art & collectibles to music, gaming etc. The idea is to showcase a diverse range of assets, communities, capabilities, and the utility that Algorand NFTs offer. We agree that it’s more clear to refer to an “Algorand NFT Collection” than “Algorand Foundation Art Collection”, so we’ll go with the former term from now on.
Second, we envisage that the development of selection criteria for specific works will be driven primarily by the community, initially at least via a committee consisting of Foundation and community stakeholders. Future oversight, decision-making, and management will ideally - in the Foundation’s view - be folded into the xGov process, a DAO, or some other community-led structure. To be robust and effective, such mechanisms would need to be well thought through and developed via extensive community involvement and consultation.
The benefits we would hope to see from this initiative, if passed, include:
- Offering a forum to display Algorand NFTs.The collection would be showcased in both virtual and on-site events, giving select projects/creators the stage and marketing visibility, and showcasing Algorand’s robust range of NFTs to people within and outside the ecosystem.
- Providing support to existing creators on Algorand. Purchasing select pieces and/or emphasizing primary sales and shuffles is just one example of this kind of support. Other examples may include providing grants for strategic/high-profile initiatives, commissioning work, providing creators yield via fractionalization and/or collateralization or other support mechanisms.
- Onboarding new users into the Algorand ecosystem. For example, running campaigns, shuffles and giveaways to attract collectors from other chains and incentivizing them to create new wallets.
- Engaging with Algorand’s existing NFT collectors. Active governance is one example, but the collection committee could collaborate with ecosystem players (i.e. DeFi platforms, NFT marketplaces) around awareness, “learn to earn (NFTs)” programs etc.
Finally, we heard many voices calling for a choice on whether to pursue this project at all (the original drafting only contained a choice of whether to fund 300K or 600K Algos). We have responded by providing such an option.
Tl;dr;
Measure 4 asks governors whether or not we should allocate funds to seed the establishment of a Community curated NFT Collection. Then, in Measure 5, governors vote on whether to allocate 300K or 600K Algos for the seed collection. Measure 4 is only relevant if Measure 3 is passed.