Questions for Algorand Foundation June Community All-Hands

Since the official registration for the Algorand Foundation June Community All-Hands again does not allow submissions of questions of more than 100 characters, and most of my questions haven’t been addressed since the May Community All-Hands event, I am posting my questions again here in hopes that the Foundation (e.g. @Massimo @stephenfoundation) will consider addressing them.

Questions regarding Governance:

  1. Could the Foundation please elaborate on why it deems necessary there to be another layer of Governance (i.e. xGov) rather than having the whole governance system on the same level? Such a two-layer system requires an additional, unnecessary assumption to work for the good of Algorand - i.e. that the majority of the subgroup (i.e. xGovs) from all Algorand users, acts for the good of Algorand (instead of just the existing assumption of the majority of all Algorand users). Despite the fact that proposals would still need to be confirmed by the majority of all users, the smaller group of xGovs could be more easily overtaken by bad actors, resulting in censoring of proposals or even proposing only malicious measures for vote.

  2. How can the Foundation deem the Governance system to be decentralized if it will keep the authority to edit (thus also censor) proposals (even if this is with the noble goal to ensure accurate language and compatibility with Foundation’s mission statement) as per the M2 of G3? A solution should be (and can be) made that doesn’t require a central authority.

  3. Would it be possible to get Silvio Micali to comment on the Governance and its recent measures (especially the apparent distancing from the 1 ALGO = 1 vote principle in Governance)?

Questions regarding ecosystem funding:

  1. How much ALGO has been distributed currently through Aeneas program and how much of it is there still left?

  2. Is there a report on what the Aeneas (Virdis Phase II) and Virdis Phase I where used on? This is not detailed in the last transparency report.

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  1. Some of your questions have been answered here: And as long as one does not believe that the majority of the Algorand stake is malicious based on the basic assumption that one would not harm oneself, the security assumptions at xGov do not change significantly. Governors are already only a part of the Algorand stakeholders and have to show more commitment. The same applies to xGovs, so that the composition of stakeholders in terms of benign and malignant should not change significantly. A model that shows the opposite would have to demonstrate abstruse mathematics. Especially since, as you said, another barrier is that a large part of the governor’s stake must still agree to the proposals. If xGovs propose a malicious proposal, it should be assumed that this will be largely rejected, otherwise the system would be flawed anyway, so that a malicious proposal would end up costing the creators of the proposal time due to the barrier of the largest stake of the governors.

  2. I guess you are talking about the changes to the Foundation’s own proposals. As long as it happens before the vote, I don’t see a problem with it for now, even if it is a bit annoying. Otherwise, the xGov system serves exactly to decentralize proposals. This includes the inviolability of proposals.

  3. It would be interesting to hear his opinion.

Unfortunately, this is not the case. My question is not about the need for others besides the Foundation being able to propose measures for vote, nor about the required commitments to be able to propose a measure. My only question is why is there a need or what are the deemed benefits for introduction of an additional layer instead of having the ability to propose measures on the same level as voting on proposals. This was not addressed by the Foundation neither during G2 nor during M2 of G3.

Should not change significantly” is a rather vague argument when talking about security. In G3, ca. 3.5B ALGO participated, which is about a half of circulating supply. Indeed, to be able to make concrete claims on the security impacts of xGovs, it would be necessary to see how much ALGO will be committed. But it will be equal or smaller than in Governance, thus equal or less secure. But regardless of the amount in the end (even if all Governors participate in xGov), what is the benefit of taking on a potential additional risk from the introduction of another layer (as slight as that risk might be in the end)?

In another post and a subsequent update, I have outlined one possible solution that fulfills the same requirements without introducing an intermediate layer.

The difference in the two approaches is essentially I suggest that Governance emulates (initiative) referendums, while the Foundation suggests to have a sort of a mix of a representative system (for making proposals) and mandatory legislative referrals. While it’s true that with xGovs most likely anyone will be able to join on their own this representative body, I am not seeing the benefits of such a mixed system outweighing the cons, especially compared to a really purely direct participation system.

No, with my 2nd question I am referring to the following part of M2 of G3:

It was a quite disappointing Community All-Hands:

  • A lot of future events listed
  • Governance questions were simply avoided.
  • Recent crypto turmoil was mentioned as a passing remark
  • NFTs were popularized, instead of plans for mass adoption of Algo…

1 Algo trades for 0.29 USD now. The work crew and the top officials of Algorand Foundatioon probably get their salary NOT in Algo, do they?

I posted one question before the session: “What are the plans of the Algorand Foundation to protect small investors?” I would like to get a decent plan/answer.