[DAO:e1ff3d8] Proposal for Establishing a Council for Decentraland DAO

Governance
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by 0x511a22cdd2c4ee8357bb02df2578037ffe8a4d8d (ginoct)

Linked Draft Proposal

Proposal for Establishing a Council for Decentraland DAO

Summary

Establish a Council for the DAO to oversee the Executive Arm, approve annual strategies and budgets, and ensure alignment with the DAO’s mission. VP holders (The community) will elect council members and hold the Executive Arm accountable via them.

Abstract

The current governance model of the Decentraland DAO requires VP holders to vote on every proposal, leading to slow processes, lack of accountability, and misalignment with strategic goals. DAO members should vote less on more important stuff to reduce voter fatigue. To professionalize operations, the DAO needs to delegate operational oversight to an Executive Arm. However, for this to function effectively, and be held accountable for its actions, the DAO must first establish a Council of Representatives responsible for hiring, guiding, and, if necessary, replacing the Director of the Executive Arm.

The Council will also oversee the approval of the Executive Arm’s annual strategy and budget, ensuring alignment with the DAO’s mission. Council members will be elected and dismissed through VP voting, ensuring community control while enabling more efficient and professional governance.

Motivation

Currently, the Decentraland DAO expects all VP holders to vote on every proposal, which presents several issues:

  • Inefficiency: The process is slow and cumbersome, delaying critical decisions.
  • Lack of Expertise: Many voters lack the necessary context or skills to make informed decisions, leading to suboptimal outcomes.
  • Time-Consuming: Requiring the full attention of voters on non-critical matters is inefficient and unsustainable. Creates voter fatigue and discourages active participation.
  • No Strategic Direction: There is no clear mechanism to ensure alignment with long-term strategic goals.
  • Diffuse Responsibility: With everyone voting on everything, accountability is diluted, making it difficult to hold anyone responsible for poor performance or missed opportunities.

Specification

Council Composition:

  • The Council will consist of 5 doxxed members who are subject matter experts in areas such as strategic management, finance, creativity, and technology.
  • Members should have a deep understanding of Decentraland’s technology, audience, and stakeholders.
  • Provide representation across different sectors, including the Foundation, MANA/LAND holders, the developer and creators communities, and Decentraland citizens.

Election and Dismissal Process:

  • Council members will be elected through an open call and VP voting. Currently, a hiring proposal requires a minimum of 6 million VP and a one-month voting period.
  • Members can be fired via VP voting through a firing proposal, also requiring 6 million VP and a one-month voting period. Additional options such as ongoing VP backing for Council members could be explored in the Governance proposal.
  • In the event of a Council member’s resignation, the Council must initiate a new open call to fill the position within the following month.

Compensation:

  • Council members will be compensated 1,000 USD per month payable in MANA for their responsibilities and commitment.

Responsibilities of the Council:

  • Hire the Executive Director: The Council will be responsible for hiring, guiding, and, if necessary, replacing the Director of the Executive Arm.
  • Approval of Strategy and Budget: The Council will review, approve, and publish the Annual Strategy Plan and Budget proposed by the Executive Director.
  • Treasury Management: The Council will approve and publish the Treasury Management Strategy to ensure long-term financial sustainability.
  • Formal Oversight: The Council will hold formal meetings every three months with the Executive Director to review progress, and members must be available for individual meetings with the Director as needed.
  • Publishing Reports: The Council will publish regular reports on the status of operations and the treasury, outlining the contributions and decisions made by each member.

Veto Power:

Once the Council approves and publishes the Annual Strategy and Treasury Management Strategy, a veto governance proposal can be initiated within a two-week period of the decision publication date, giving VP holders the chance to block any decision that is misaligned with the DAO’s mission or goals.

Impacts

Best-Case Scenario:
The formation of a Council leads to efficient, strategic guidance within the DAO. By focusing VP holder voting on the election and removal of the council with veto power on important decisions, the DAO reduces voter fatigue while accelerating critical decisions. This setup allows the Council to bring focus and alignment to the DAO’s initiatives, enabling the Executive Arm to act more decisively to support long-term goals and push impactful community projects forward. The Council’s regular reporting and direct accountability to VP holders build community trust and transparency, reducing concerns about centralization.

Possible Scenario:
The Council achieves partial success by reducing voting burdens on VP holders and introducing some guidance on what should be executed while improving the communication between different ecosystem actors. However, some VP holders may feel disengaged due to the shift away from direct voting on operational issues, while others appreciate voting on fewer but more substantial matters. Initial challenges with Council governance, such as defining rules and internal frameworks, could lead to minor inefficiencies but would likely improve as the Council gains experience and community feedback is incorporated. Though progress may be slower than ideal, the structure ultimately provides a degree of alignment and improved transparency, balancing new efficiencies with a learning curve as the Council adapts to its responsibilities.

Worst-Case Scenario:
In a worst-case scenario, the Council’s formation unintentionally causes community members to feel distanced from governance, viewing the shift as overly centralized despite Council accountability measures. If the Council faces internal disagreements or lacks a clear decision-making framework, it could mirror the inefficiencies it was designed to resolve, leading to stagnation or conflicts and not pushing the Executive Arm forward. Without effective communication and transparent reporting, VP holders may lose trust in the Council, resulting in a decline in active participation and a potential long-term drain on community cohesion and resources.

Implementation Pathways

1. Open Call for Council Candidates
The first step is to initiate an open call for Council candidates, allowing any interested members to submit applications on the DAO forum. An application form template will be provided to ensure a consistent and transparent application process. During this phase, candidates will not be required to reveal their identities (doxing), which will only be necessary if they are elected. The application window will remain open for two weeks, allowing ample time for candidates to express their interest.

2. Creation of Hiring Proposals by the DAO Committee
After the application period closes, the DAO Committee will review submissions and create formal hiring proposals for each candidate. These proposals will be published simultaneously on the DAO governance platform for community voting. VP holders will vote to select Council members, with candidates receiving the most VP moving forward, provided they meet eligibility rules. For example, if three out of five most-voted candidates are Decentraland Foundation employees, only the top two will be selected and the third one will be discarded, leaving the seat to the next voted candidate.

3. Initial Council Assembly and Framework Definition
Within one week of Council selection, members will convene to establish initial work guidelines, frameworks, and internal rules. This process will include setting up reporting practices, defining on-chain oversight mechanisms, and internal governance rules. These guidelines will provide a foundation for Council operations and ensure transparent communication with the community from the outset.

4. Drafting Strategic Guidelines and Overseeing Executive Arm Formation
Within 60 days of its formation, the Council will present a draft of strategic guidelines to the community, outlining the DAO’s potential focus areas. Also, if the proposal for creating an Executive Arm passes, the Council will initiate a recruitment process to hire an Executive Director and build the team, adhering to the DAO’s principles of transparency and accountability. These guidelines will serve as a roadmap for the Council and Executive Arm, ensuring alignment with the community’s vision and enabling feedback before formalizing the strategy.

Conclusion

Establishing a Council for the Decentraland DAO is a critical step toward professionalizing the DAO’s governance and improving operational efficiency. By delegating the responsibility of hiring and overseeing the Executive Arm, approving strategic plans, and managing the treasury, the Council will ensure that Decentraland’s operations are aligned with its long-term mission and vision. This proposal seeks to address the inefficiencies of the current system, reduce voter fatigue, and bring accountability to the DAO’s operations while maintaining community control through VP voting mechanisms.

Vote on this proposal on the Decentraland DAO

View this proposal on Snapshot

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Doxxed to who? Like would someone, for example, like @Canessa be eligible who is doxxed to many, particularly the foundation and anyone who has attended the live events, but not to me or most of the community? Because I’d be mostly fine with something like that, or would the people applying to make $1000 a month have to subject themselves to being fully doxxed to the entire community?

I love the DCL community, but there are some crazy people in this space. Having had one of them use my Linkedin photo as their Twitter pfp while tweeting insane things has left me with a desire to warn anyone considering fully doxxing themselves to this community to maybe reconsider. It certainly doesn’t seem like it would be worth $1000.

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There needs to be expiration dates where a vote takes place on whether committee members retain their postion or not. Whether that be 6 months a year or 2 years doesn’t matter but I will not vote yes on anything that does not have a term limit.

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Let’s bring up few disadvantage of this proposal:

  • Potential Centralization Risks: Although accountability mechanisms have been introduced, giving the council greater power in management could make some community members feel deprived of their governance participation, reducing their sense of belonging to the project. If issues arise within the council, this could lead to even greater management risks.
  • Decrease in Voter Engagement: While removing voting on daily operational issues reduces voter fatigue, it may also make some members feel distanced. The lack of voting opportunities could make them feel they have less actual influence on the project, leading to a decline in active participation.(actually we need much more active participants)
  • Initial Governance Adjustment Challenges: In the early stages of the council’s establishment, there will be a need to define internal rules and decision-making frameworks, which could lead to inefficiencies and management challenges. The roles and responsibilities of the council need to be clearly defined, and it will take an adjustment period, which may negatively affect community trust and support.
  • Council Member Representation Issues: The proposal specifies that council members should represent different fields, but without a reasonable screening and open selection mechanism, council members may fail to represent all community stakeholders, leading to governance imbalances.
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Proposal centralizes power by giving significant control to a small group of five council members, leading to reduced community participation. Without clear rules, council members might favor their own interests or those of specific class they represent. All this goes against the DAO’s decentralized nature. Without term limits, these members could remain in power indefinitely like with DAO Committee, reducing accountability and stifling fresh ideas.

There’s a lack of clarity on how DAO approved decisions will be enforced and who is responsible for implementing them. This could result in important proposals being ignored or not acted upon. This is a good example: https://decentraland.org/governance/proposal/?id=4f628ce9-ab7f-4aab-abb2-6f10742164e5

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This no longer has anything to do with decentralization. Please think about that when you’re going to vote (But that was already the case with this ill voting system where those with the most property, i.e. with the most VP, have the most power) Just say. Have a nice day.

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Hello, while I support the concept of an executive committee, my concern is that ultimately, one individual from the foundation has control over DAO decisions and funds, as approved here:

Proposal for Establishing a Council for Decentraland DAO

The proposal states that council members will be elected and dismissed through VP voting, which is intended to ensure community control and enable more efficient and professional governance.

However, new members will essentially be elected and approved by a single person holding 8.5M VP. For genuine community control over voting, why not distribute that VP among a broader layer of trusted members who have demonstrated their commitment to Decentraland.

As someone with 6,266 VP, earned through investment in the belief that I would have a say in this DAO, the implication that my vote doesn’t matter is disappointing and contributes to my further disengagement as a community member.
Jenn

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One of my friends from the polkadot ecosystem doxxed himself for a $500 a month crypto job. One month later he went missing. I started to google who he was and he had school relationships with a lot of early bitcoin millionaires…
So yhhhhh dont dox yourself…
Crypto is anon for a reason…

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In regard to the issue of Doxing, if someone is funded by DAO then we should know who they are. Especially in this role, trust is essential and how can we truly trust someone who will be paid without knowing who that person is? Voting NO but somehow, I think that 8.5M VP will vote this in no matter the opinion of us little guys…

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I feel like “doxxed” is a spectrum

If I have no interaction with you, and neither does the community, then the level of doxxing should be higher then someone like a Canessa, or an Awedjob who have been active and engaged in countless spaces and given us, as a community, a chance to get to know them as an individual.

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13

It also tells hackers who to target…
There will be a financial reward for successfully targeting them…
Where as true anon would be almost impossible to attack… but thats not going to work for a social job…

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Although the new structure seems coherent and necessary, I abstain from voting because the proposal does not specify that D&O (Directors and Officers) insurance will be hired, something essential to support the security of the members of the council.

This type of insurance protects members of the council against lawsuits related to decisions made in their role, covering legal expenses and compensation for errors or negligence, but excluding illegal acts.

What I am going to discuss is extremely important and should be read carefully:

Being a member of the council can lead to severe consequences if the organization does not hire adequate D&O insurance for its top management.


Fiduciary, legal and criminal responsibility

Council members have the obligation to act in the best interest of the company, this includes the duty of diligence (making informed decisions) and the duty of loyalty (avoiding conflicts of interest). If at any point members are found to have failed to meet these responsibilities, they could face legal consequences, such as fines, lawsuits, or even criminal penalties in serious cases.

Council members could be held liable if they make financial decisions without understanding the underlying risks, so if the company faces serious financial problems (something that seems likely when the vesting contract ends), they could find themselves legally and financially involved. In certain cases, council members can be held liable for the company’s debts if it becomes insolvent and appropriate measures are not taken, and they may be forced to take on the financial burden.

In situations of mismanagement or negligence, they could be held liable to financially compensate the company or harmed third parties. For example, if the price of MANA plummets and it is believed that they have not taken measures to protect the interests of stakeholders.

Regulatory compliance

Council members must ensure that the company complies with all legal and regulatory standards. Failure to do so could lead to regulatory investigations by members that are not only uncomfortable, but can also result in sanctions for the members. A clear example of risk would be implementing ideas such as Decentraland acquiring DG (suggested in a recent Discord conversation), which although may be interesting ideas have too many legal issues for the council members to assume personal responsibility, even more complex in the crypto industry, which has many legal loopholes, ambiguities and significant risks.

D&O insurance benefits

Protection against indirect lawsuits: In some situations, the company itself could face lawsuits if the directors are not adequately covered and act defensively to protect themselves. Good D&O insurance reduces the risk of these problems affecting operations.

Bankruptcy: Protecting council members if the company becomes insolvent due to a fall in the price of MANA making financial commitments impossible.

Investor class action: Covering potential costs and compensation if shareholders sue the company and its directors for significant loss of value in their investments, again, for example, from a sharp fall in the price of MANA.

Regulatory fines: This would cover penalties for failing to comply with regulations, which could otherwise be claimed from council members.

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I agree.

I fully doxxed when I was hired by the Foundation for the Ambassador Coordinator position, knowing that this was a requirement for this job, as they needed W-9’s, etc. to stay compliant. I was able to request that my “Canessa” alias was used, and it was.

The DAO is different than Foundation. One concern I would have for residents of the US is how responsible you could be if federal guidelines around the liability of DAO’s changed. I know this caused US citizens to withdraw their applications to work for the DAO Committee, as there are grave implications if you are the sole US citizen legally connected to a DAO (in case of a lawsuit). :cold_face:

Would being a Council member mean you have this same level of liability? This would be worth knowing a very clear and concise answer before anyone takes this job.

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There should be nothing to fear about the concentration of VP that is made in a decentralized way.

On the other hand, there is much to fear from the concentration of decision power that comes under the form of any kind of Council.

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To begin with, “Doxing” is the act of revealing personal information about someone online without their consent. The use of this term in a Governance context is hardly appropriate.

This is just not true.
VP holders who wish to not participate in DAO proceedings can simply Delegate their VP.

VP holders who received delegated VP but also do not wish to not participate in DAO proceedings, should be able to simply re-delegate this VP.
VP is not a kind of “honor point system”. VP is not a “reward” to be awarded to “those you feel deserve it” !
VP a “decision power” force. There should be no issue seeing one’s VP re-delegated to someone who is trusted by this person in whom you trust.
Total control still remains if VP can be un-delegated in all cases.

This sounds like the beginnings of a Bloated Government.

VP holders can Delegate their VP, which if done properly, should be able to generate this kind of Executive body all the same, while preserving the decentralization the DAO currently has.

There are a few issues with the current VP system which make it hard for this “decision power” to properly coagulate. I suggest we try to fix those first, before rushing to a solution as drastic as the creation of a Council. Making it possible to re-delegate VP is one of them

I shall endeavor in forthcoming posts to clearly describe all the fixes that I have in mind.

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I don’t care if development is more centralized if the team will be productive and effectively reaching goals and results.

I don’t feel having control over the Bitcoin protocol but I still have ownership of my cryptos, the same thing for my MANA and my LAND and my NAME/world… but please, do a fucking good work or at least try your best so that our assets are worthy on a good platform and enriched ecosystem (for whoever that will be working in this new org) :pray: :candle:

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You should absolutely care if alternative solutions haven’t been tried first.
There are serious misconceptions about VP Delegation which need to be clarified.

Also the logistics of the Thresholds hasn’t been tinkered with enough, which should be the obvious next step. Perhaps a dynamic Threshold based on participation should be considered.
Or perhaps Stalled proposals can just be extended until enough VP has voted.

And maybe, at the same time, 50% is too low, perhaps 2/3 of the majority should be required for Governance votes, this could have prevented the passing of e.g. For Decentraland Daily Active Users: MANA incentives for USDC-ICE LP.

It is really too drastic of a “fix” to be moving away from decentralization.

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Example of a Proposal that could simply have had its deadline extended:
Draft: Infrastructure for LANDs
Governance: Infrastructure for LANDs + Infrastructure for LANDs

Here’s another one, which had to undergo a re-submission before finally being accepted:
Draft: Bidding and Tendering Flow
Governance: Bidding and Tendering Flow + [Resubmission] Bidding and Tendering Flow

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0x7f8317150beb1b7670bee39f5750f113d4b2d61a writes
StarVote#d61a voted “Yes” with 8.51M VP,2 hours ago
Even though I don’t agree with the selection process, I think we need to move forward fast

This is just not the way to reason about a voting process !
If you do not agree with the selection process, you must request the Proposal be rewritten !

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Proposal for Establishing a Council for Decentraland DAO

This proposal is now in status: PASSED.

Voting Results:

  • Yes 94% 12,682,623 VP (26 votes)
  • No 5% 681,411 VP (14 votes)
  • Abstain 1% 266 VP (2 votes)