Hello fellow DAO members, I’d like to preface this proposal by saying as one of the newer members of the group that I feel a bit out of my depth posting this. However, I’ve had a few discussions recently that lead me to believe it is a conversation worth having, especially at this point in the DAO’s development. Although I do have an opinion on the topic, the driving motivation behind this proposal is ultimately just to raise the question and establish how the DAO wants to move forward on this matter.
As most of you have likely heard, we are getting closer to receiving full execution of the agreement between The Graph Foundation and the DAO, which will subsequently clear the path for the Graph Foundation to provide funding for the DAO. Although I am still quite new to the DAO, it is my understanding this has been long awaited and will mean the DAO will be able to proceed with compensation payouts for epoch 0, 1 and 2 (which ended yesterday – May 31st).
The delay in executing the agreement (and thus receiving funding) may have created an opportunity for the DAO to consider a potentially positive proposal. Currently, compensation is scheduled to be paid out entirely in GRT, since the entire DAO funding will be received in GRT. However, it may be worthwhile to consider engaging with the Graph Foundation to discuss the feasibility of the DAO receiving partial or all funding that is budgeted for compensation in USDC stablecoins instead. This idea, if permissible by the Charter and agreeable to the DAO and the Foundation, would provide DAO members with a greater degree of consistency and fairness regarding the value of compensation they receive at the time of payout.
As an example, in epoch 2 for May, the GRT conversion rate that is set for May is $0.42 while the current price of GRT is currently around $0.15 at the time of writing. This means, under the current model DAO members would receive an approximately 60% reduced value at the time of payout. While it’s understood that these changes can go in both directions, it exemplifies the high range of fluctuations crypto currencies have historically experienced and are likely to continue to experience for the foreseeable future.
I believe that switching to a model of entirely USDC compensation would benefit not only the DAO members individually but also each of the three committees collectively (who must create quarterly and yearly budgets that include member compensation) by providing consistency and reducing workloads by removing the need to create, monitor, modify, and communicate the GRT conversion rates on a regular basis. It should also be said that there’s nothing stopping DAO members from converting USDC to GRT on their own after receiving the payouts if they were so inclined.
There is also the option of a “blend” model: Partial GRT and USDC compensation. I think there are some benefits with this approach, however, I personally think it would get quite complicated very quickly and require unnecessary work for DAO members/committees (both of which already have their hands full).
I’d like to emphasize that any change of this magnitude should be based on principle and not merely the current price. There is obviously the chance that DAO members could benefit from the current model in future epochs, and it would look poorly on us a group if we were to request a switch now because of unfavorable directions, only to go back to the Foundation asking to switch back on the heels of potentially favorable directions in future epochs.
One very important item to address if the group does vote to make changes to the current compensation model is ensuring that the current charter language could allow partial or all compensation to be provided in stable coins (USDC). With that in mind, I’m CC’ing @dannyb here for his input.
Lastly, to provide additional clarity on the proposal, here’s the [Graph AdvocatesDAO Financials File] (https://docs.google.com/spreadsheets/d/1cp8PA9ihOQJvCzE8NfYNV1N5fGo1QN2LlXt0snlGzYI/edit#gid=835093003) that details the Q2 budget of the DAO. We are expecting a total funding from the Graph Foundation in the amount of 624,750 GRT. You can see that $61,500 is earmarked for compensation (currently expected to be funded 100% in GRT). That $61,500 is the amount in question, whether it should be funded to the DAO (partially or full) in USDC.
With all of that said, I have created a poll that DAO members can vote on below, please vote for the structure that you prefer.
100% USDC / 0% GRT
75% USDC / 25% GRT
50% USDC / 50% GRT
25 % USDC / 75% GRT
0% USDC / 100% GRT (current structure)