Public Giver's reform proposal

TL;DR

Mistakes have been made. Let’s try not to make new ones by blaming decentralization and contests. Let’s move on. Kill sub-governances. Kill partnerships. Apply contests when necessary. Apply direct funding when appropriate. Create a Decentralized Governance Fund (DGF) to support decentralization and entrepreneurship with everything we have.

The proposal is at the end of the text, you can scroll to my proposals directly if you are not interested in logic behind them.

Mistakes have been made

Without pointing fingers let’s agree mistakes were made in regard to use of public funds in the first year of Free TON (now Everscale). Analyzing those mistakes is important in order to reach correct decisions in the future.

It is common theme in Everscale community today to blame sub-governance and contests for current state of affairs. When asked “what state of affairs” the usual answer is the token price. I believe this whole logic chain is flawed. The danger is that if we continue to trump that horn even more wrong decisions will be taken. We will simply kill everything good that have been created, ruin whatever small community we do have and destroy our identity. This will trigger the end of this project and network, not the fallen token price. Many networks had their tokens almost near zero price. Didn’t kill them. Cause they were true to their values, true to their community, true to the principles of decentralization. There are still scam projects around us, but eventually all of them will die. Because sooner or later investors in these project will wake up to the reality of a Naked King.

The token price is not the problem, the growth of the community is, the technological progress is. And the contests are not the problem of the community growth or technological progress — the system that creates them is. We can stop token distributions, we can transfer all tokens to some Central Committee, that will supposedly make more effective choices, we can even declare our own private Communism… the end of all such initiative will lead to total destruction of value, because no value has ever been created this way.

Economics and history teaches us only one lesson about creation of value. That the value has always been created by entrepreneurs. And by entrepreneurs only! If we want the token price and the value of this network to grow — there is only one way and that is even not subject to debate — attract entrepreneurs. Not developers, not investors, not users. Entrepreneurs.

I wrote about it in the White Paper, in the BFTG paper and repeated in more or less every debate we ever had about it.

Ok let’s look at this from the positive side — sub-governances were an experiment that failed miserably. We need to destroy that structure. Completely.

Same goes for the Partnership Giver. Let’s admit this giver and enormous number of tokens in it was created while thinking that Telegram one day will adopt this blockchain. The decision to destroy these tokens was correct one. Now we need to destroy the partnership Giver all together, stop any partnership proposals we may have.

Some of you may say, but we had Sub-governance X or the Partnership Y that were successful, shouldn’t we just improve the system so it will be more of those and less of the failed ones? Yes we did, no we can’t. There is no way to improve that system in general. Because all successful sub-governance and all successful partnerships were based on personal integrity and leadership properties of very few people. We can not replicate those people. This is not a system and it may never be.

In "On Nathan Schneider on the limits of cryptoeconomics", Vitalik Buterin correctly points out:

So what’s the problem with finance? Well, if finance is optimized and structured collusion, then we can look for places where finance causes problems by using our existing economic tools to understand which mechanisms break if you introduce collusion!.. Even worse, cooperative game theory suggests that there might be no possible way to make a fully collusion-resistant governance mechanism.

Contrary to what I said above, contests themselves are not the problem. The way we produce them and the way we apply them are.

What contests are good for:

  1. When public funds need to be distributed for a work that must be done for a public good and can not be supported through entrepreneurship (because public tenders are prone to corruption).
  2. When several solution to the same problem are beneficiary (because grants are based on past achievements).

What we did instead was trying to apply the contest model to everything at all and we gave the decision to run them to almost everybody. This was asking for collusion. It is very easy to drain tokens from the giver using this or any other mechanism if your whole target is… to drain tokens from the giver. It does not really matter if it is a Subgovernance or any other institute as long as it runs by people with wrong motivation. I am very far from saying all those people had bad intentions on purpose. It is simply that any motivation apart from “creating value” is a wrong one. And the only mechanism that ensures the value creation is “entrepreneurship”. It is simply how economics work.

The BFTG paper describes a way how to try to create a non corrupted mechanism for distribution of public goods. We never finished implementation of the BFTG system itself. This is telling. This should be an indication of the difference between entrepreneurship efficiency and public funding inefficiency in general. Does not matter if this funding is provided under Grant, Contest, by sub-governance or foundation. The results are almost always the same.

We must turn this upside down: take a risk, create a system, prove it works, receive the funding.

Proposal

  1. Cancel all future sub-governances
  2. Budgets that sub-governances have now should be put into the task of finishing developing of infrastructure projects that can not be commercialized by itself (like protocol and system contract developments)
  3. Cancel and stop all partnership proposals.
  4. Support Entrepreneurship via an Everscale Decentralized Governance Fund (DGF) as described below (and in the white paper).

Decentralized Governance Fund

Decentralize Governance Fund should provide a community support through other community Funds (CF) to act like a fund of funds.

The DGF will run Periodic contests for Community Funds. The contest rules principles are described below. The winning CF designs and implementations will receive token support from DGF always in the form of participation on top of private funding.

Community Funds contest general rules:

  1. CF must only accept submissions from entirely on-chain projects
    – that means no projects which business is not generated on-chain, revenues collected on-chain and products delivered on-chain.
  2. All CF process must be on-chain via system of smart contracts
    – means all CF processes, including its governance, decision making and funds distribution must be on-chain
  3. CF must have its own governance token (CFGT)
  4. CFGT must be tradable on at least one of the Everscale DEXes
  5. Projects accepted by CF must have Governance Token (PGT) that captures value of the project products, collecting all project revenues on-chain
  6. PGT must have clearly explained, documented mechanics and finite supply
  7. As part of CF funding PGT must be listed on at least one of the Everscale DEXes.
  8. CF must facilitate both funding and liquidity as part of the funding criteria
  9. CF must collect funds from the public and demonstrate that clearly

Each contest winner shall not receive more than 10 m. Evers support at a time. Previous winners can only apply for new findings if they show a positive balance of operations of their portfolio’s PGTs, reflected also in the price of their CFGT.

DGF will provide a support for winning of the Periodic contests in a form of Quadratic or Linear Funding on top of the CF own funds invested in PGTs via holding of the CFGT tokens, but won’t take any part in the CF investment decision processes.

DGF will be managed by its own Governance Token (DGFGT) which will be provided to any community member willing to prove ownership of 1 mln Evers. 1 DGFGT will be minted towards wallet smart contract holding directly or via any available defi instruments (staking, farming, wrapped and so on) of 1 mln Evers

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Candid thoughts on the status quo. Though it was an innovative idea at the beginning of Everscale, sub-governances have not produced real value except just a few of them.

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Good proposal. But who will judge important contests like deSupport?

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DGF will be managed by its own Governance Token (DGFGT)

… means for me, every holder of that token will be able to judge via DAO smart contracts collection.

@Mitja do you propose to stop all partnerships without exception? I’m talking about a partnership with the DeFi alliance

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I understand that everything is logical in this proposal. I don’t understand why exactly 1 million … If the amount is 100 000 or 10 000, then more people will be able to take part in the management DGF. I think that holders of smaller amounts also have voting rights… :flushed:

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image

ну конечно нет, наоборот это логично, как ты можешь голосовать, если твой голос стоит 0.000000001% ? Ну проголосовал ты и что? Опять же, если если ты не держатель евера или мелкий держатель, почему твой голос должен учитываться? таким образом все захотят голосовать имея 1 евер на своем счету.

[Cough] [Cough]
What happened to " 1 token : 1 vote " mechanism?

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Community didn’t write a proper SMV contract up until now. This one can start tomorrow with hand picked judges.

Does this look right to you?
Setting a “1 million” minimum token for voting will eliminate many retail holders/investors.
I feel like the only ones who got 1 million right now, are current initial members & partners who are already voting on the main GOV.
So not much difference except for removing SGs…

Am I wrong?

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To get a DGFGT token, we will have to block a million? And this million won’t be able to work?

We still don’t know evers curse tomorrow. Maybe a million, it won’t be so much.

In one year of activity, SGs failed to achieve any serious results. Looking at most of the contests, you can see how the tokens go into the void. Sometimes it would be much more profitable and efficient to order some activities from professionals in their category (for example, PR marketing) than to do it within the community. Also, some products obtained in the results of competitions, they can hardly be called a ready-made solution. No matter how sad I am, I agree with the abolition of SGs.

Partnerships in most cases are ineffective, we conclude partnerships but do not use the capabilities of partners to the maximum and the most important thing is that the market value of the services of some partners (for example, a partnership with a wallet, ala free wallet, Lumi) is much cheaper than the allocated tokens. We do not include aggressive advertising in the communities of our partners. The partnership system definitely needs to be changed.

But still, what will change if you delete the SGs, start (CFGT) and give these tokens to millionaires. Will this help fix the situation? Will the millionaires vote better? Will they control contests and partner commitments? (partners will come anyway.) And the competence of millionaires in the field of knowledge of the contest topic or other decision for which you need to vote is also a question :thinking:.
We can run like a squirrel (in another) wheel.

I believe that there should be some compact working groups that do their own thing. Following the example of the Listing team, there is a rebranding (TON Crystal > EVER), we are changing exchanges, monitoring and other services in a quiet working mode (without using a competitive system).
You can also create an advertising department, a partnership department, work with entrepreneurs, etc., with individual corporate mail. Groups that work on behalf of EVER outside the community.

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Yes, this makes sense, only not in entrepreneurs, but in the community, which should be friendly, cohesive and active, and entrepreneurs are a small part of the community that play their role. Cryptoeconomics is different from traditional economics and this needs to be understood…The phrase , is not subject to debate, - as it does not fit with the principle of decentralization … And it smells very bad.

An extremely ill-considered and destructive proposal. This cannot be supported, let alone vote for him.
Whether the contests were conducted well or badly, this is a secondary question, the main thing is that they were and played the role of a kind of airdrop that acts with a certain efficiency, and this is not even the point, but that the unity of the Free TON community around the contests and subgovs, this is what united if this system breaks down the project will gradually fade away. Partnerships are indeed mostly problematic, but nevertheless, they are better than nothing and some of them have worked.

Why the project is developing poorly and the price of the coin is not growing, this is not due to contests and subgovs, but with the wrong central line, which was conducted all this time. The policy pursued by Main Gov rather than the subgovs, the attempt to shift responsibility from the central body to the rest now looks extremely ugly.

Voting with 1 million coins, it makes no sense to even discuss, a clever maneuver of how to make decentralization centralized.

In general, if you want to finally bury the project - vote for this proposal.

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Мы все умрем ,конец децентрализации ,да здравствует слово богатых.

Also a correct remark … And where can we see their PR, listing and everything else that was described in the proposal. Three weeks have passed, except for the partnership with Indian developers, in general silence. Or they received money and then begin to develop a strategy… although it is possible that the Defi Alliance mixed up the projects and advertised ton coin, which just the next day after the adoption of the proposal Defi soared in price and was listed on 5 top exchanges …!

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We must evolve.

I love the idea of distributing tokens through contests. At least, I’ve been thinking so until recently. Now I think that maybe (just maybe) I’m biased because I’ve taken part and won good prizes in some specific contests: I’ve put time and work in those and I’ve seen that my fellow contestants done the same. Is that possible that I’m extrapolating this experience and it leads me to wrong conclusions about “SGs doing contests” system in general? Well, maybe.

When I hear somebody saying that “contests is a form of airdrop”, it saddens me (to say the least), because I’ve never felt that I received those rewards for nothing. It must not be like that and, I believe, community has always been agreed on that we must distribute tokens in meritocratic way – not randomly.

We must evolve and leaving things as they are is not an option.

Do I think that Mitja’s proposal is the most obvious evolutionary step on the road to perfection? It’s hard to tell for me, really. But I definitely like some of things he proposes, especially the possibility to be funded for those who’s ready to take risks. This is the state which existing contests system must evolve into, in my opinion.

There are numbers in this proposal, though: 1M as a voting threshold, 10M funding cap – I wonder where they came from? Is there any calculations or models the author could share with us?

All in all, I’d vote for, because I don’t see any more thought through visions of the Everscale future in this important aspect.

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Are the suggestions for improving the management system interesting or have you already decided everything?

Yes, in many respects I agree with you, but the airdrop was just an example, but not a direct comparison, and by the way, in airdrops you need to complete certain tasks, so I compared them with contests.

But to vote for this proposal, just because there is no other alternative, it is completely wrong.
First of all, you cannot destroy the old system, at least it somehow works, but after all, no one bothers to build a new one in parallel, at least this will preserve the dynamics of the project.

Unfortunately, in this propose there is no clear understanding of what is moving the project forward, let alone the fact that all the promises that were announced earlier are being violated, including the voting system.
To destroy the old and then think about how to build the new - we have already gone through this more than once, and it always ended badly.

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