- Proposal to allocate a bunch of UMA tokens for 100 delegates to vote with and earn rewards. They can’t sell the UMA, but get the rewards at the end of the epoch.
- Increase mindshare and understanding of the OO on Crypto Twitter
- Strengthen the oracle and start to address the corrosive “influential whale” narrative
- Diversity of voters based on geographical location and language
- Side benefit is a big synergy with establishing multi-language support, for voters first and then developers after.
- Voting has been an incredibly engaging activity in UMA when there is a contentious dispute.
- On the one hand this represents the skin-in-the-game of the market’s participants, but it also represents passionate UMA tokenholders and armchair contract lawyers. It’s a fascinating place to be.
- “Voting as our Mindshare hack” is a big part of my strategy in this proposal: I want people to get sucked into the arguments around voting. I want them to spill out on Twitter. A good drama like a dispute about whether pausing Elonjet was fraud?! That should have made the front page of twitter!
- More importantly, this will demonstrate to people how UMA’s OO works. If that dispute had gone viral, people would have seen: Oh, the resolution source was stated, but it was defrauded, so UMA’s OO looks for other sources of truth.
- Going after multiple languages using geographical criteria will diversify UMA voters drastically, which will let UMA “See more of the world.” This is good for both optics and actual robustness.
- Each delegate will control a hot wallet which will have permission to vote with $UMA tokens contained in a delegated wallet.
- They can vote and accrue rewards into the delegated wallet, but do not custody them.
- At the end of the epoch, they will be sent the rewards they earned to their hot wallet
- The principal $UMA provided by the DAO will be returned to the DAO.
I propose that each delegate earn an amount of UMA that will yield an estimated $500/month. To arrive at that value perhaps we do a 30-day TWAP and base it on that. This does mean that if $UMA’s price changes, the payout would change; this is denominated in $UMA after all. I think this is a fine thing! And aligns incentives.
At the end of the epoch, Risk Labs will then distribute the voter rewards to each person more-or-less manually, and return the principal amount back to the UMA DAO. E.g., if they start with 1000 tokens, and at the end of the year have 1,380, then they will receive 380 tokens to their wallet and the 1000 tokens will return to the DAO.
The goals of the program will inform delegate selection. The goals are:
Influencer - As reflected on Crypto Twitter. Likely to be people who are in the sort of “dev or intellectual influencer” category. Basically we want to choose people we could imagine would talk about the game theory of an optimistic oracle, for example.
Language ambassador - A language ambassador would be someone who takes the role of translating content for voters and essentially replicating some of the discussion, but in their language. I propose that we start with trusted, bi-lingual contacts and give each of them 3-5 “delegate grants” to choose other people they also trust, who would support in the language support. This program does “both things” insofar as it provides an incentive for voting participation but also grows out that language community where there was not one before.
Intellectual contributors - This overlaps with influencers, but if we can get a selection of crypto and defi heros to participate, like founders, famous anons, prominent devs, or the like – We could have many opportunities to discuss with them the design of the OO and how we should best interact with it. If we get devs to participate, they will 100% wholly understand what UMA’s OO is capable of.
Period: 1 year
Target monthly rewards: $500
Group size: 100
Total cost: ~$600,000
- This is not a dilutive proposal. What is means actually is that tokens that currently don’t vote, will start voting; the right way to see it is that the program is paid for as a tax on voting rewards.
- The formula for calculating this tax would be something like:
- This means the proposition before tokenholders isn’t to put new tokens into the market, but rather to share in their voting rewards because they have become convinced that it’s a worthwhile way to improve the product.
- It’s possible there will be more sale pressure from these tokens if the delegates don’t become aligned with the protocol while doing this campaign. Since this really will be entirely on-chain, it would be easy to do on-chain analysis. The most important KPI would be the % of people who hodl and vote after the end of the first epoch. If we do future rounds that data will help inform delegate selection in the future.
The delegated wallets will be custodied by a Risk Labs address. This is good because Risk Labs has institutional-level security best practices, whereas the target recipients may or may not have good security hygiene. Of course, once they receive the rewards at the end of the program they’ll custody them.
It is also nice to consider that this program could be offered to people who are entirely outside of crypto. They would just need instructions for connecting a metamask wallet to the voter dapp, and then to find their way into Discord.
This proposal is unusual in that I’m asking to allocate some amount of Risk Labs’ time, which the DAO isn’t really supposed to make determinations on. If there were no Risk Labs, this proposal would explore hiring someone to execute on this.
One way to avoid the imposition is to send the funds to a RL controlled address, with the mandate that if the program didn’t launch in 3 months from dispersal, the funds would need to be returned. The idea being that the DAO is creating the opportunity for RL to do the thing, but isn’t expecting to be able to demand it.
The implementation cost will be non-trivial.
Developer time - To set up the delegation system for this program.
Growth team time - Communicating the program, selecting the people, onboarding them.
- Presently, the delegates would receive voter gas rebates into their hot wallets, as paid out monthly. If that program ended, which is a contingency I’d like to think about, they would have to pay their own gas. It’s not such a bad thing if they have to make some small investment into this, from a behavioral economics perspective.
- I couldn’t figure out the right math to figure out the % impact this might have on an individual tokenholders’ rewards. If someone wants to take a shot, I suggest using Henry’s dune dash as a resource.
A note about this proposal…
I didn’t share this proposal with the Risk Labs team in any detail–If there’s interest enough to do so, I’d love to brainstorm all together on smoothing the edges.