[DAO:520c3a3] DAO Grants Program - Budgeting System

by 0xd11a019a70986bd607cbc1c1f9ae221c78581f49 (Yemel)

Linked Draft Proposal

DAO Grants Program - Budgeting System


Define a budgeting strategy for the DAO’s Grant Program in order to secure the good standing of the treasury and long-term operations of the DAO.


The Decentraland DAO has been granted a 10-year vesting contract worth 222M MANA starting on Feb 19, 2020. The MANA in this contract vests every second, thus gradually increasing the size of the DAO’s fund, at a rate of 1.8M MANA per month. Also, the DAO has its own revenue streams such as marketplace fees and wearable curation fees.

This proposal defines a strategy to limit the maximum amount of funds that can be allocated quarterly via the Grant Program.


The DAO’s grant program is one of the best vehicles to help grow the Decentraland ecosystem. However, at this moment there is no general consensus about how much the DAO should be investing in this program.

By reviewing the results of more than one-year operations , the total budget allocated since the beginning of the grant program can be calculated:

  • Platform Contributor 35% = $2,584,100 USD
  • Gaming 26% = $1,887,500 USD
  • Community 21% = $1,558,400 USD
  • Content Creator 18% = $1,346,809 USD

Alternatively, the results can be displayed in these categories (aligned with the proposed new categorization of grants ):

  • In World Content 49% = $3,545,400 USD
  • Platform 21% = $1,585,169 USD
  • Core Unit 7% = $520,200 USD
  • Sponsorship 9% = $687,500 USD
  • Documentation 3% = $193,800 USD
  • Social Media Content 4% = $282,240 USD
  • Accelerator 7% = $487,500 USD

The DAO needs to agree on how much should be spent and implement a control mechanism to ensure there is no overspending. This will secure the long-standing operations of the DAO.

It’s also necessary to agree on the distribution of the funds over different categories of projects. This will prevent allocating 95% of the funds to one category and not leaving space for other important initiatives. The DAO should agree on a diversification strategy and revisit it periodically.


The Grant Program will be divided into four periods (Q1, Q2, Q3, Q4). At the beginning of each quarter the maximum amount of money that can be allocated through the Grants Program will be defined using the formula:

5,500,000 * MANA_PRICE * 0.7

This means the DAO at maximum capacity will be spending 70% of the MANA received from the vesting contract. For example, using $0.39 as the current MANA price , the total budget for the quarter will be $1,501,500 USD.

Also the DAO should set a desired distribution of funds on the different grant categories. Define the maximum amount of funds that can be allocated to a particular activity and when that number is reached, it won’t be possible to request more grants of that category until the start of the next quarter.

Below is the proposed distribution for the first quarter, including the quarter budgets using the previous example of a MANA price of $0.39:

  • Platform 40% = $600,600 USD (per quarter)
  • In-World Content 20% = $300,300 USD
  • Core Unit 15% = $225,225 USD
  • Sponsorship 10% = $150,150 USD
  • Accelerator 7% = $75,075 USD
  • Social Media Content 5% = $75,075 USD
  • Documentation 3% = $45,045 USD

The DAO can change this distribution in the future via a Governance Proposal or by implementing an alternative voting mechanism such as weighted voting.


The proposed changes to the vesting contract will have the following impact:

  • Calculate a total budget per category to spend at the beginning of each Quarter.
  • No more grant requests will be accepted for a category that already reached its budget.
  • The DAO will be able to change the percentage to spend (70%) and budget distribution for the next Q via a binding proposal.

Implementation Pathways

The Governance Squad will implement the following changes:

  • Update Decentraland documentation.
  • Display the total budget for the quarter and for each category.
  • Invalid the submission of grants for categories exceeding the budget.

These changes are all feasible and can be developed in one or two weeks. The DAO Committee will ensure to don’t exceed the quarterly and categories budgets, effective since January 1st, 2023.

Any community member can send a governance proposal to change the overall budget and distribution for the next quarter. Eventually, this could become a binding proposal without the need to go from Poll > Draft > Governance.


The DAO has an income of 1.8M MANA every month and it should set up a limit control to not spend more than 70% of such a stream. This will mitigate the risk of running out of funds in the next 7 years.

The DAO should agree on limits for each category, so that the funds are distributed based on a targeted strategy. This will encourage initiatives in underfunded categories.

The DAO refreshes and recalculates the category budgets using the MANA price at the beginning of each quarter. It’s possible that many grant requests will be submitted when such limits are refreshed, looking to secure their budget before it’s allocated to other initiatives. This could be beneficial for the DAO, encouraging competition and ultimately leveling up the bar.

Vote on this proposal on the Decentraland DAO

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As for procedure, how will this occur? Is this going to have to be a pre-poll, draft-proposal, and final proposal each quarter? Or will this automatically have a poll where people vote? I like this idea, but I am asking for clarification on how this will be done.

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I see this, but I see this being problematic, is there a way to make a new procedure for this?

Could you give an example of the categories using existing grants? just would like to have an idea of what you’re thinking for categorization. For example, is dcl-metrics core unit? documentation?

Dcl-metrics is Platform.


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ah got it, thank you! :pray:

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DAO Grants Program - Budgeting System

This proposal is now in status: PASSED.

Voting Results:

  • Yes 99% 10,663,397 VP (66 votes)
  • No 1% 4,656 VP (2 votes)
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DAO Grants Program - Budgeting System

This proposal has been ENACTED by a DAO Committee Member (0xbfa6d24e6a061e9aea3447163fdfe045177dd40e)

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