Today, the Maker Foundation continues its efforts to prepare the voting community to govern the Maker Protocol after complete decentralization. The voting community being in charge of the entire Maker project is the only way to ensure the long-term security and sustainability of the Maker Protocol after dissolution of the Foundation. It is vital to continue removing every possible centralized point of failure from the project.
Therefore, over the next three months, the Foundation will initiate key readiness discussions on the weekly public Scientific Governance and Risk calls and in the Maker Governance Forum. These conversations will focus around three key elements of a self-sustaining DAO— the technical, human, and procedural elements that will enable the community to maintain a fully decentralized Maker Protocol and be completely responsible for every aspect of the DAO:
- Elected Paid Contributors (EPCs) and Domain Teams
- Maker Improvement Proposals (MIPs)
- Vote Delegates
A high-level overview of each element is below; details are provided in this Maker Forum post. On Monday, April 6, the Maker Foundation will publish the first 13 MIPs. Look for the announcement here on the blog, and the MIPs in the Maker Forum.
Key Elements of a Self-Sustaining DAO
The process of dissolving the Maker Foundation will take place over time. But preparation begins now with the introduction of three critical elements that might, should the governance community agree, be used to maintain a fully decentralized Maker Protocol. By summarizing them now, the community can ready itself to discuss, vote on, and even refine them long before the Maker Foundation steps back.
Long-run Governance Is Critical
For the Maker Protocol to function effectively into the future, the community must be well-informed and equipped with clearly-defined governance processes. This requires a system for current contributors to share knowledge with new contributors, for creating comprehensive documentation, for polishing current governance platform technology, and for building new technology when needed. Clear processes, as well as practical experience, will be particularly important when the community takes full control of systems that underpin governance and maintain the security of the Protocol.
- Elected Paid Contributors (EPCs)
While Protocol and governance operations rules are enforced by smart contracts, the DAO must equally rely on human knowledge and expertise. As the Foundation scales back its activities, more and more of its support will be provided by a decentralized workforce elected by Maker governance. This workforce, dubbed Elected Paid Contributors, will operate with a radically transparent and horizontal form of organization, and be paid directly through governance. EPCs may include experienced developers, security consultants, legal advisors, marketing and communications experts, HR and accounting teams, and other necessary roles. Additionally, the Foundation envisions that a subset of EPCs, called Domain Teams, will be required to manage critical processes. In fact, last year, the Maker community elected multiple domain teams to operate the Maker Protocol, including an Interim Risk Team and an Interim Oracle Team.
2. Maker Improvement Proposals (MIPs)
Just like other Blockchain Improvement Proposals (BIPs, EIPs, etc.), MIPs will provide a mechanism for any community member to define key issues and suggest changes and additions to the system. Unlike some other BIPs, MIPs will be critical to the evolution of the current Maker governance process and must, therefore, be rigidly structured and formalized to avoid any ambiguity. While the Foundation will initiate conversations and draft the initial MIPs, the community may propose competing MIPs. Ultimately, the final decisions will be made by MKR voters. The aim, after all, is to provide a clear, transparent framework that allows Maker governance to adapt and evolve the Protocol as needs and circumstances dictate far into the future. See this Forum post to learn what the first 13 MIPs will cover.
3. Vote Delegates
As the community takes a greater role, it will be more important than ever that all MKR holders have an active stake in the ecosystem. By introducing Vote Delegates, any MKR holder will be able to pool their voting power with others, giving them greater agency and ownership of the project, and further decentralizing governance.
Delegates will act as representatives for MKR holders who choose not to vote directly. Any community member will be able to throw their hat into the ring as a Delegate, stating their vision for the Protocol and the ways they intend to vote on key issues. MKR holders will then be able vote for Delegates with their tokens (without giving up control of their MKR).
Successful Delegates may gain significant influence as a result of the voting power handed to them by MKR holders, while less successful ones will be less inspiring. Additionally, MKR holders will be able to withdraw their support for one Delegate and back another at any time. In short, Delegates give MKR holders an easy, effective way of making sure their voices are heard. The introduction of Delegates should increase voter turnout and be key in helping the community harness the MIPs.
Notably, all MKR holders, regardless of whether they delegate, will have access to all the essential information needed to continue governing the Protocol. With MIPs open, transparent, and community-driven; governance and community calls open to anyone; and with technological documentation on the Maker Protocol already in the public sphere, there will be no informational asymmetry among MKR holders and all participants in the Maker ecosystem.
Result: A Fully Implemented Governance Paradigm
The initial Governance Paradigm will be a grouping of the first MIPs and EPC roles proposed and drafted by the Maker Foundation with input from the community. Aimed at ensuring all critical elements are covered before the Foundation is dissolved, the Paradigm will help the DAO function properly, maintain security, and grow exponentially in the future. Community members and Delegates can experiment with all the tools noted in the Governance Paradigm, gaining practical experience and valuable communication skills that they will be ready to use independently.
The Path to Creating a True DAO
MakerDAO launched with the goal of ultimately becoming a completely Decentralized Autonomous Organization run by and for its community members. Importantly, to successfully launch and refine the Protocol over time, many core development and governance processes have been guided by the Maker Foundation.
The voting community’s support of the core principles of Maker governance has allowed the Foundation to embrace a process of gradual decentralization over the years. In December 2019, the Foundation transferred the Maker and Dai trademarks portfolios to the then newly formed, independent, and non-profit Dai Foundation. Just prior to that, the Foundation announced shared control of the MKR token —the governance token of the Protocol— with the smart contracts, and therefore, the governance community. And the most recent and most significant step yet toward a self-sustaining DAO was to transfer complete control of the MKR token from the Foundation to the voting community.
Your Protocol Needs You!
Full decentralization is paramount to Maker’s mission for good reason: It’s absolutely necessary to provide the trust and transparency needed to offer users full financial freedom. For Dai to continue to succeed as a stable, unbiased currency that can be used and controlled by anyone, anywhere, the Maker Protocol must be self-sustaining—collectively owned and controlled.
Decentralization underpins the security of the Protocol’s smart contracts and the network of economic actors that maintain Dai’s peg to the US Dollar, removing single points of failure and centralized interference. Importantly, it also future-proofs the ecosystem, creating sustainable models for funding and growth. Ultimately, decentralization is the only way of realizing the benefits of DeFi: low costs and no barrier to access financial services of all kinds.
The post What Will Maker Governance Look Like After Complete Decentralization? appeared first on The Maker Blog.