Decentralizing Aragon’s governance: Possible first steps

Goals

• Start transitioning Aragon’s governance from a highly centralized model to a more decentralized one
• Experiment with community participation while still ensuring the safety of the project
• Document and formalize this new process so governance stakeholders can be kept accountable

Description

Right now the governance of the project is fairly simple:

Using the following components, I propose an structured process to start decentralizing governance:

• The Survey app 16, which lets the DAO query ANT holders with non-binding votes
• The Finance app 13, which lets the DAO keep track of finances and propose new transactions
• The Voting app 10, which lets ANT holders vote on binding votes (such as approving or proposing new transactions in the Finance app)
• Frame 19, which lets anyone vote using hardware wallets

Let’s divide governance decisions into two groups:

• Binding: Governance decisions taken by stakeholders are automatically enforced by code or legal contracts
• Non-binding: Governance decisions taken by stakeholders are not automatically enforced by code and need humans to actually perform the outcome desired by the stakeholders

Since this is a proposal for kickstarting decentralized governance, we still need to keep safety measures in case any possible attack or malfunction happens in the governance system or voting mechanism.

That’s why I would like to propose a mechanism in which:

• The Aragon Association (previously called Foundation), the legal entity that has power over the project, still has power to make governance proposals
  • Either proposes to perform a direct action (like spending funds, or updating legal terms)
  • Or proposes to appoint some entity (a delegate) that will act in behalf of the project (like appointing someone to manage the grants program or the social media channels)
• But ANT holders have power to veto those proposals
  • If ANT holders veto a delegate nomination, the Association must propose different delegates
  • If ANT holders veto a proposal, and it’s clear that there has been an attack on the voting mechanism, the Community Multisig 5 could veto the veto as a last resort

So there would be four types of governance decisions:

• Binding

  • With direct veto
  • With veto over delegate nomination

• Non-binding

  • With direct veto
  • With veto over delegate nomination

Now let’s jump into the actual proposal for decentralizing governance over each component.

Nest grants

Binding, with direct veto over its funding and veto over delegate nomination

We can transform the Nest grants program into its own DAO.

The funding of that DAO would work as follows:

• Nest would have a yearly budget approved by the Association
• The Association would create the transaction to fund the Nest DAO
• ANT holders could veto it

And its governance:

• The Association would propose delegates who would run the program for a year
• ANT holders could veto the proposal

Funds

Binding, with direct veto

Thanks to the split between the Association and the development teams 3, the Association will perform a few monetary transactions per year, therefore making it possible for ANT holders to have direct veto power.

Examples:

• Giving out a sizable grant to an Aragon development team
• Sending money to the Nest grants program

Social media, Aragon Chat

Non-binding, with veto over delegate nomination

• The Association would propose delegates to run the social media accounts and maintain the Aragon Chat for a year
• ANT holders could veto the proposal

Repositories

Non-binding, with veto over delegate nomination

• The Association would propose delegates to maintain the repos
  • Repos would be software repos but also include the multiple websites that are statically hosted
• ANT holders could veto the proposal

Next step would be to make this a binding proposal by using Pando 7.

Legal terms

Binding, with direct veto

• The Association would propose versions for
  • The Trademark Policy, that lays out how to use the Aragon brand
  • The Licensing Policy for significantly changing the licenses of the software or content
• ANT holders could veto the proposal, in which case they would remain unchanged

In order to make this binding, the Association would sign a legal agreement stating that it will adhere to the results of the votes for updating or not updating these legal docs.

Technical implementation

This would be achieved by deploying a DAO (Aragon Governance DAO) with:

• A Finance app and a Voting app, for binding decisions

  • The Voting app should require high enough parameters in order to really gauge community discontent. This could be:
    • 25% quorum, so 1/4 of ANT holders would have to vote
    • 51% support, so more than half of the votes are required for a veto to happen

• A Survey app, for non-binding decisions

  • We would need to state the amount of votes that we would consider for a veto
  • As the app is multi-option, each delegate could have its own option, so holders could veto one of the delegates but not the others
    • We could say that in order to veto a delegate, 10% of ANT are required to veto

• Describe some unsolved problems or points of discussion, if there are any.

Uncertainties

As with any token-based voting mechanism, there can be perverse incentives so holders want to veto proposals for their short-term benefit. I believe this is mitigated by making veto the first step, and not full control, therefore giving the Association the power to propose.

Also this should be seen as a transition state, until we have the research and experience in place to give ANT holders full control over the Aragon Governance DAO.