Standardizing Payments in the AN DAO

Dear Aragon Community,

We wanted to pull a proposal together to standardize the payments in the DAO for all contributors.

We are now a few months into paying contributors in the DAO and some of the hypotheses have been put to the test in the payment process. We hypothesized that a 60 Day rolling average ANT price would smooth the peaks and troughs for contributors in the DAO. It was also assumed that a 50/50 split of ANT would be the optimum amount. Both of this have proven ineffective on a day to day basis and the majority of the feedback we have received has been regarding the transaction fees, ANT price swings and the (diminished) ANT pay out. Therefore, we would like to propose two things that we aim to implement in season 1:

  1. Split payment 70/30 (USDC/ANT)
  • The current 60-day rolling price average of ANT, does not have the desirable effect in terms of price.
  • As the price of ANT fluctuates over the payment period process which is currently 14 days, we would like to test to pay out a larger portion of the bounty in a stable coin
  • So we propose to pay out the bounty in 70% USDC and 30% ANT
  • As contributors we will receive more authority, as we can swap USDC later on back to ANT if you want (against low fees, due to proposal 2), When more governance rights are desired, they can easily (cheap and fast if Polygon) swap their USDC towards ANT in the desired proportion (hence more authority)
  1. Transition USDC from ETH chain to Polygon chain (reduce transaction costs)
  • Paying on Ethereum mainnet is extremely expensive for contributors
  • Transactions can get blocked for hours or even days if a low gas fee is used
  • Not capital efficient

Technical Requirements
To move USDC from Ethereum to Polygon, we propose the HOP bridge can be used:

Hop is a scalable rollup-to-rollup general token bridge. It allows users to send tokens from one rollup (or mainnet) to another almost immediately without having to wait for the rollup’s challenge period.

In addition, Hop has never been hacked and has multiple audits under its beltl, see https://help.hop.exchange/hc/en-us/articles/4405172444429-How-safe-is-Hop-. Alternatives like Synapse protocol have higher TVL than Hop, however, parts of Synapse have not been audited, see FAQ - Synapse Protocol

TVL graphs:

Hop: https://defillama.com/protocol/hop-protocol

Synapse: https://defillama.com/protocol/synapse

Finally, there is also the official Polygon bridge at Polygon Web Wallet v2, however, it seems like this bridge is constantly under maintenance and it is slower and less efficient than Hop.

Hop interface to move USDC to Polygon can be accessed here:

By default, funds are bridged over to the same address and the source address, but it’s possible to also bridge to a different address by defining a custom recipient.

By transitioning USDC over to Polygon, we provide the contributors completing bounties greater flexibility when they are paid so that they can swap back into whatever percentage allocation they want without incurring in high fees.

We would appreciate the AN Tech Sub-DAOs input on the bridge they feel is the most secure.

This proposal also paves the way for streaming payments using Superfluid, which we are exploring for future implementation.

Conclusions

The payment process was never finalized for the DAO and we would like to propose this become the standard for all guilds, contributors and teams across the DAO. We appreciate this will not be perfect for all contributors but we have aimed for a balanced approach and we would appreciate your input on the split and other aspects of the proposal.

Proposers: @alexclay, @dxiri, Shivam & @Ricktik6

5 Likes

Both of these are great and I am sure it will enable new people to participate in the DAO while giving them optionality on what to do with the payouts.

2 Likes

This is a great proposal which I strongly support. I would like to highlight that this has been primarily designed by new contributors to the AN DAO and we should thank them for making such a strong first proposal. I really appreciate that they have not only focused on improving operations for AN DAO but also on creating better, more empathetic and capital efficient outcomes for our growing team of contributors.

One point to highlight, the proposal at certain stages refers to “bounty” when I am assuming this is just a proxy for any type of “reward” or contributor payment regardless of origin (recurring, bounty, coordinape circle etc). No need to comment on this small detail unless I am mistaken in this understanding.

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Awesome work @AlexClay @dxiri @shivam and @Ricktik6 for providing solutions. I will be referencing this post as the Standard for account practices in S1 proposals, so this is super helpful for the governance process as well as contributors. Thank you.

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Great work team!
Looking forward to everyone’s response / feedback, as this is an important change that we think benefits contributors and the AN DAO.

1 Like

Excellent point @AlexClay as this could be a potential pressure point later when the number of contributors scale and so it is best to be dealt with sooner rather than later.
I like the idea of 70:30 Stable:ANT and like the idea of using Polygon even more, especially because it will make the payment of smaller bounties feasible and faster.

Two questions remain unanswered in my mind:

  1. ANT price?

As you mentioned: “the current 60-day rolling price average of ANT does not have the desirable effect in terms of price”. So what do you propose the price of ANT should be for contributor payments?
One idea is we use in the Tech Support Guild is to fix the price of ANT at the time of the announcement of the payment (bounty, reward, etc.). It does not take care of price fluctuations (I do not know what can) but the advantage is that contributors know what they are getting in advance as opposed to at the end of the bounty when the 60 days rolling price is evaluated. So if the reward is for $100 the announcement would state $50 USDC and 10 ANT (@5 USD/ANT) using the current system.
If we change to 70:30 Stable:ANT it could work even better as the monetary value is somewhat fixed with the stable coin and you know exactly how much voting power you are getting in advance.

  1. How soon can this be implemented? What is the timescale?

Thank you for bringing the issue up and looking forward to community feedback. :+1:

Great proposal @AlexClay, reducing the ANT payout to 30% will help with payment volatility and potential confusion amongst new contributors. There was some confusion amongst a few new contributors like me when the first payout was below the advertised $100 due to the 60-day rolling price average of ANT. Going forward, as mentioned by @SpectraCryptoVerse clarifying to all bounty holders that they will receive $x in USDC and xANT tokens based on the token value to USDC when the bounties are assigned, could help avoid confusion and reduce reward fluctuations.

Hey @SpectraCryptoVerse,

You are correct I should have also added this in, I think dropping it to 14 days would make a difference which is currently the average payment cycle.

This still does not solve the full challenge though it should make a difference though.

Happy to hear thoughts on this gap though.

Thanks,

Alex

Support this and sounds like a great step forward in addressing these issues and creating a better system for everyone.

1 Like

Thanks for everything you all have been doing to ensure everyone gets paid on time. I know that has been a struggle!

So over at Index they use a 5-day rolling average and it seems to work really well. I think 14 days may be a bit too much considering how unstable the market has been recently. Although as long as there is communication (i.e. 10 ANT @ $5/ANT) when payments are being made, I think that will help with our expectations.

2 Likes

Following on from time to review I will post this vote on Monday the 11th of April to standardize the payments across the DAO. This would then become the default standard across all teams and guilds. Any feedback or comments still greatly appreciated.

Thanks,

Alex

2 Likes