University Node Operators & Governance Delegates Program

Grants / Bounties
14

Just for some general colour as to what reasoning threads tend to look like from university delegate programs here’s some examples from Maker and others. Imo quality can vary a lot, and is more dependent on the individuals and groups involved (just like any other delegate.)

Worth noting Maker’s delegates have the potential to earn ongoing compensation.

And from some other DAOs. Having done a cursory search, I think some delegates in Aave have been incentivized recently. Fairly sure there isn’t any incentivisation in Uniswap.

Delegation is interesting, so here are some other arguably off-topic thoughts which are hidden below:

Delegation Thoughts

I do think it helps a great deal to have some sort of on-going financial incentive connected to the requirement to post reasoning for votes (obviously). The requirement to post reasoning sounds really simple, but actually if you are serious about doing it properly, it will consume a fair amount of time.

The mechanism at Maker prior to the recent change in how delegation works was that:

  • Delegates could receive more or less compensation based on the amount of tokens they had been delegated.
  • Delegates were required to vote consistently, and post reasoning consistently to be eligible to receive any compensation.
  • Because reasoning had to be posted publicly, the quality and effort put into reasoning could be used as an input for token holders wanting to delegate, in theory leading to competitive pressure on delegates to do a good job at decision-making and communication.
  • This mechanism requires token holders to actively redelegate in favour of good delegates. In practice at Maker, this did not happen consistently enough to introduce enough competitive pressure to prevent less effective delegates being compensated.

Which is all a long winded way of saying: I think that some sort of ongoing incentive mechanism (even one that doesn’t introduce enough competitive pressure) is a requirement to get consistently communicated reasoning out of delegates.

2 Likes