by 0x5b5cc427c1d81db4f94de4d51d85ce122d63e244 (Fehz)
Linked Draft Proposal
Limit Fund Appropriation to Grant Proposals
Summary
This proposal aims to restrict the appropriation of funds from the Decentraland DAO to the established Grants Framework.
Abstract
This proposal advocates for limiting fund appropriations from the Decentraland DAO to the established new Grants Framework approved on December 28, 2022. And it comes as a response to previous instances where funds were allocated through binding governance proposals, raising questions about the legitimacy of such actions. By implementing this measure, the DAO aims to ensure that all project and initiative funding adheres to the approved Grants Framework.
Motivation
The motivation behind this proposal stems from past events where the Decentraland DAO allocated $1 million USD in MANA to Decentral Games (ICE-USDC liquidity pool) to incentivize Daily Active Users (DAUs). This allocation was done through a Binding Governance Proposal as it did not fit within the existing Grants Framework’s parameters. While it was neither explicitly permitted nor prohibited under current DAO rules, it triggered crucial discussions.
Two key questions emerged from this incident:
- Is it appropriate to appropriate funds outside of the previously agreed Grants program framework, such as through binding governance proposals?
- Is the existing Grants Program framework adequately designed to accommodate all funding needs of the DCL community, especially for special projects with more flexible distribution models?
The DAO approved a new Grants Program framework with updated categories and requirements to address these concerns. This led to the creation of the “Grant Accelerator” category as a way to provide private companies or revenue-generating initiatives to request investments from the DAO.
Specification
The proposal’s main objective is to restrict the appropriation of funds from the Decentraland DAO to the established Grants Framework. This restriction explicitly prohibits the use of binding governance proposals as a means to receive money from the DAO treasury.
Outside this restriction is the compensation of the committee’s team members that have been established through binding Governance proposals (Such as the DAO Committee, Wearables Curation Committee, or Revocations Committee).
In all other cases, the Grants Framework serves as the sole mechanism for requesting and receiving DAO funding.
Impacts
-
Streamlined Funding Process: The proposal eliminates the use of binding governance proposals for fund allocation, which may have been less structured and consistent in comparison to the Grants Framework.
-
Mitigation of Loopholes: The proposal serves as a stop-gap measure to close potential loopholes in the governance and grant-making process. It prevents future instances of unauthorized appropriations of DAO funds for projects and initiatives outside the established Grants Framework.
Implementation Pathways
The approval of this proposal will prohibit the use of binding governance proposals as a means to receive money from the DAO treasury.
Conclusion
As the Decentraland DAO evolves, it must remain adaptable to changing circumstances while developing an agile and robust governance system. This proposal acts as a stop-gap measure to address potential loopholes in the governance and grant-making process. While long-term solutions are explored and implemented, this measure will ensure that all funding aligns with the approved Grants Program framework and prevent appropriations through binding governance proposals.