As the owners of a decentralized virtual world, the Decentraland community members should strive to increase its own participation in the platform’s governance.
Having the DAO as our participative organ, the progress we make towards this objective can be measured as the number of people that are actively involved in the DAO, as well as the stake devoted towards that. Unless these numbers increase, the project remains subject to attacks from opportunistic actors, and drastic changes could pass without real buy-in from users.
This proposal provides a solution to this problem, whereby the DAO taps on its MANA reserves to provide staking rewards to those who become an active part of the governance.
Currently, MANA holders must wrap their MANA, turning it into wrapped MANA (wMANA), with which they can suggest proposals and vote on other people’s. However, perhaps due to the friction inherent in using the dApp to do so, the level of participation has remained somewhat low across the board.
The proposed solution is having the DAO provide staking rewards to those who stake their tokens and become active participants in the governance. The DAO would periodically provide an amount proportional to the size of the stake. This amount is a Stake Reward Parameter that can fluctuate over time, and which is set by the DAO itself. Initially it could be set at 4,400,000 MANA per year, or 15% of the annual DAO budget. Depending on the amount staked, therefore, DAO participants could expect an APY between roughly 5-20% (in each extreme, the amount of MANA wrapped would respectively be 88 and 22 million MANA).
Additionally, there should be a Minimum Governance Parameter, explained as the minimum frequency of activity (e.g., 4 months) that would make the DAO deem a person who stakes eligible for the rewards. For example, the DAO could determine that those who vote at least once every 4 months are deemed active members of the DAO governance, and are therefore eligible for the staking rewards. It’s important to note, however, that abstaining is a valid form of participation.