[DAO:ad73b7a] DAO Grants Program - New Tiers & VP Threshold

Governance
1

by 0xd11a019a70986bd607cbc1c1f9ae221c78581f49 (Yemel)

Linked Pre-Proposal

Restructuring the Community Grants Program

Summary

Redefine the tiers of the DAO’s Grant Program, making it more flexible and secure.

Abstract

Currently the grants program allow the following Tiers:

  • Tier 1: Up to $1500 USD in MANA (1M VP + 7 days) - One Time Payment
  • Tier 2: Up to $3000 USD in MANA (1M VP + 7 days) - One Time Payment
  • Tier 3: Up to $5000 USD in MANA (1M VP + 7 days) - 3 Months Vesting
  • Tier 4: Up to $60,000 USD (2M VP + 14 days) - 6 Months Vesting
  • Tier 5: Up to $120,000 USD (4M VP + 14 days) - 6 Months Vesting
  • Tier 6: Up to $240,000 USD (8M VP + 14 days) - 6 Months Vesting

This proposal simplifies all six categories and redefines the VP threshold required to access such grants. It also makes it more flexible by allowing the grantee to define the duration of the project and the payable currency (MANA vs stablecoins).

Motivation

The DAO’s grant program is one of the best vehicles to help grow the Decentraland ecosystem. The current tiers structure was approved by a community vote almost a year ago, and now is a good time to review the results and propose improvements.

By reviewing the results of one year operations , some conclusions can be drawn:

  • The tiers 1, 2, 3 represent 2.5% of the money granted.
  • Tier 6 represents ~60% of the money granted, with an acceptance rate of 27%.
  • The tier 4 is the most easily approved one, with an acceptance rate of 45%.
  • Voters generally abstain from expressing their decision if the current result is aligned with their preference and the threshold has been achieved.
  • Grantees almost always request the maximum budget allowed in the tier.
  • Many projects requested funds for a scope longer than 6 months.
  • The VP involved on grants has steadily increased over time, and it’s likely that only highly contentious grants get voted on by more voting power.

For this revised version of the Grants Program, the following changes are proposed:

  • Adjust the minimum VP threshold required to pass a small-tier grant.

  • Make the VP threshold variable based on the requested amount; the more money you need, the more VP is needed.

  • Allow more flexible vesting schedules to support different kinds of projects (longer and shorter than 6 months).

Specification

A new scheme of two tiers is recommended:

Lower Tier:

  • Up to $20,000 USD, payable in stablecoins or MANA using a Vesting Contract, or a one-time payment (after 30 days).
  • Vesting duration can range from 1 to 6 months.
  • Votation period: 2 weeks.
  • Votation threshold: 2M VP.

Higher Tier:

  • From $20,000 to $240,000 USD, payable in stablecoins using a Vesting Contract.
  • Vesting duration can range from 3 to 12 months.
  • Votation Period: 2 weeks.
  • Variable votation threshold, using the formula: 1.2M + TOTAL_BUDGET * 40VP/USD .
    • E.g. $60,000 USD requires 3,600,000 VP
    • E.g. $120,000 USD requires 6,000,000 VP
    • E.g. $240,000 USD requires 10,800,000 VP

Analysis and considerations for the future
There are two parameters of this model that could be easily changed over time in contrast to the current tiers system, allowing for more flexibility and a quicker iteration of this structure over time as participating VP increases. Those are:

  • The 2M threshold on the lower tier
  • The slope of the threshold on the higher tier (currently set to 40 VP per USD requested)

Participation over time could be monitored and changes in these parameters could be suggested based on more information and data collected from this new schema. This factor could also follow a nonlinear relationship to the amount being requested, but a thorough analysis of why that would be beneficial should support such change.

Conclusion

The proposed change aims to adjust the required VP thresholds, aligning them with current standards of participation in the DAO.

Making the VP threshold variable based on the requested amount will encourage the grantees to be more mindful of their budgets.

Also, removing the limitation of 6-month vesting and allowing grantees to define the duration of the project would make it possible to fund short-term goals such as conference sponsorships and IRL gatherings; and also year-long initiatives that are considered core to the operations of the DAO.

Vote on this proposal on the Decentraland DAO

View this proposal on Snapshot

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Thanks for all the comments and feedback shared on the forum post.

1 Like
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Voting yes but i want this documented so im making the comment I dont agree with the new vp limits being raised at this time. I think it hurts the community more then it helps. Changing of quarterly allowances ,vesting contract and categories was more needed.

1 Like
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I’d like to see more of the arguments for and against giving grants in MANA vs stablecoins. @HPrivakos mentioned this the other day and @champ has brought it up as well. I tend to think it’s better to denominate grants in MANA, or maybe grants denominated in MANA have a more favorable VP formula (1.2M + Total Budget + X VP/MANA)

2 Likes
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Sounds great! I think the dynamic tiers are a great improvement.

1 Like
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Agree with VP/USD concept but we have to find a reasonable threshold. 10M VP for a $240k grant? I havent seen any proposal even get 10M votes yet.

I’d like to see some stats on the following (or point me to where I can collect this myself):

  1. How many proposals have received over 4M votes so far? (probably very few)
  2. What was the average VP by user of those proposals that passed with over 4M votes? (probably very high due to whale votes required for passing them)
  3. What is the median user VP of ALL proposals? (the median is probably very small, especially in relation to the average that top tier proposals receive)

Increasing VP/USD higher than it is currently will give the whales even more power/control and will further discourage the little guys from voting.

7

Each of these should be separate proposals for us to vote on independently of each other, rather than all lumped together:

  • Adjust the minimum VP threshold required to pass a small-tier grant.
  • Make the VP threshold variable based on the requested amount; the more money you need, the more VP is needed.
  • Allow more flexible vesting schedules to support different kinds of projects (longer and shorter than 6 months).
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I wonder if its possible for us to workshop these items if/after the draft proposal passes, so we can come to a consensus on if/how they should be applied, without the need for having separate proposals for each one.

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Perhaps the community should be allowed to provide some input and help draft Governance proposals in the first place before they are put up for a vote.

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DAO Grants Program - New Tiers & VP Threshold

This proposal is now in status: PASSED.

Voting Results:

  • Yes 96% 5,522,572 VP (48 votes)
  • No 4% 231,735 VP (2 votes)
11

The changes are not that big compared to current standards, maybe this graph illustrates it better.

new_vs_old_thresholds

There is just one big argument, MANA is a volatile asset.

For short projects this might not be an issue, and that’s why the lower tiers now enables payments in MANA for up to $20,000 worth of USD. However, for long projects is fundamental to secure a budget in USD in order to honor commitments made with contractors and third parties.

I like the idea to incentivize the request for grants in MANA, but I would keep it simple for this iteration.

There are 31 proposals that passed with more than 10M VP.
There are 117 proposals that passed with more than 4M VP.

For the other two points, I invite you to do your own research using the transparency data sheet, or the CSV exported by the transparency OS.

The proposal was opened for public comment in the forum first and later discussed here. I’m glad for all the contributions received and the signaling looks favorable. I’ll move it to a Governance Proposal.

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appreciate the visual representation and i do get where you are coming from to a degree. I just think personally that the end user vp outside delegation has not risen enough to warrant it. Besides certain whales delegating to the community and some community members reaching out to projects i dont think voter vp has risen enough to warrant it. It will further the divide from new user and middle user to whales and those delegated by whales. Ive told you this stuff before tho.

Also should be noted tho that the way some people been trying to manipulate the dao it could be argued. Out side the one hand washing the other the whales could be possibly needed here need to maintain. Seems like some people want to destroy the dao through manipulative schemes and try to take it over thinking its fn cute or possible. This weighs heavy on the mind.

1 Like