Phonon Consuls (WORK IN PROGRESS)

Gathering Consensus
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Inspiration:

Intention:

This is a work in progress. The critical features are the bonding of candidates in order to force “skin in the game”, and the opt-out spending process. The intention is to continue progress towards more structured governance without just dropping a preconceived structure where there was none before. There is still much work to be done fleshing out the process. I am open to all ideas on how better to enact this vision. -RR

Motivation

The DAO’s work ethic has been phenomenal so far. It has carried us this far entirely organically. Structures are already built by mutual consent, they just keep getting hung up on funding.

To create enough structure to let the protocol grow, without forcing people to choose between subordinate relationships they dislike and getting work done, a system must be made that feeds this process of self-assembly

The more streamlined and hands-off the governance process, the more people can get what they want moving, and then let the group decide which efforts to seriously pursue.

Operation:

Consuls are nominated by bonding PHONON in their name.

9 nominees with the largest bonds after a 2 week nomination / campaign period are put to a ranked choice snapshot vote

the top two nominees will serve a 3-month term

funds bonded for the nominees not selected are returned

9% of the DAO's treasury at the start of the term is allocated to the Consuls budget

further funding requests go to a DAO vote

All spend requests from the consul budget are approved automatically after a 33 hour delay.

Each Consul can veto or quick-approve any spend request

Each Consul can push the other's veto to a DAO vote as a tiebreak

Negation:

A “no-confidence” bond that exceeds 33% of a consul’s bond will trigger a recall election for that position

A "no-confidence" bond that exceeds 33% of the sum of both consul's bonds will trigger a recall of the entire consular system

A consul can defect at any time and force a new election/vote of no confidence in the system itself

If both defect, or one + majority snapshot vote, the consular system is scrapped and a new governance system will be chosen by majority snapshot vote

A consul can abdicate at any time, which will refund their bond

If a consul is removed via snapshot vote, the status of their bond will be decided by DAO-wide ranked choice vote

Expectation:

  1. Nominees will show up with plans and teams that develop as they go.
  2. Consuls will assign their own compensation (subject to veto), build out staff and structure as it becomes necessary, and compromise with the best intentions.
  3. Each consul will choose their own scope, and try not to overlap too much.
  4. Vote delegation will allow the DAO votes to coalesce into something like a Senate.
  5. Longer-term and larger budget allocations will have to be approved by the DAO, and will be done so in tranches rather than on a transaction by transaction basis.
2 Likes
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Thanks for putting together this proposal. I have a number of concerns about this structure, which are outlined below.

  1. The premise behind a key motivation of this proposal: “to ensure the DAO’s potential is not limited by excessive bureaucracy …”

This has been a common criticism of the governance proposal, which is being voted on currently, and was refined and revised over a multiple week period.

However, in presenting an alternative, there are no arguments as to why the current proposed governance structure is flawed, specifically how it would lead to too much bureaucracy or “lack of decisiveness.” The current proposed governance structure is aligned around Working Groups that can be developed organically, Working Group leads develop a budget for operations and request this budget from the DAO. In addition, the other levels of governance, Community Leaders and DAO Leaders are appointed based on the number of Working Groups that are ultimately approved. To me, having the governance structure and framework driven by Working Group leaders, who develop their own plans of action, budget and strategic focus, seems to be a bit of needed structure to ensure that the DAO has the opportunity to vet proposals and expenditures in a considered fashion. There are no current definitions of Working Groups and their budgets and focus has not been outlined. There is enough structure to make people comfortable that Working Groups will be on-strategy, but enough flexibility to ensure that they have the opportunity to arise organically.

Given this, the onus is on the developers of this proposal to describe why the current governance framework and proposal is overly bureaucratic and stifles innovation and progress.

  1. Centralization risks: The Consul proposal relies on two individuals who are given nearly unlimited power, within the confines of the budget they would have access to, to fund activities with little focus on whether they are strategically relevant, beneficial for the DAO over the long-term or good uses of money. We are relying on these two individuals to make good decisions, and to be good stewards of the DAO’s funds.

This focus on giving two individuals significant economic power and discretion, creates a significant centralization of power and influence that poses great risks. Where there is economic power, there is also concentration of influence, influence peddling risks and an extreme lack of accountability.

In the current governance proposal (under Snapshot), Working Group leaders have the ability to request funds and go through a process where they present their plans and proposals to the DAO, and its elected community and DAO representatives to review. They are also accountable to the DAO and its representatives to get things done.

Creating centralization risks and concentrating economic power in two individuals in an effort to remove necessary checks and balances, is not a wise strategy in my opinion.

  1. Lack of Accountability: What happens with DAOs is that as time goes on, token holders become less active and engaged in the DAO’s activities. It is only when something goes wrong, or a proposal is controversial that inactive token voters “wake up” and begin to pay attention.

The current structure where there can be a “no confidence” vote that exceeds a Consul’s bond, may in practice, never be activated. There is also the issue associated with using a bond, of other DAO members’ assets to guarantee a Consul members’ good behavior. Again, there are no checks and balances of a Cosul’s power, and in practice this may lead to a situation where a Consul is empowered to act in ways that are not in the best interests of the DAO, and long-term benefit of the PHONON Network.

  1. Lack of Talent Diversity: The currently proposed structure encourages people with diverse skill sets and approaches to develop Working Groups to tackle existing or emergent issues facing the DAO. The Consul structure, because it concentrates economic power in two individuals, could lead to a lack of diversity because people wishing to work on DAO matters much pitch their ideas to Consul members who will have the power to approve or deny projects. Ultimately, these “CEOs” will hold sway over the DAO and focus the DAO’s efforts on topics they care most about and potentially diminish voices who do not want to have to curry favor with the Consul to get their projects approved.

Conclusion:

As written, this proposal has numerous issues that should be addressed, including:

  1. A rationale as to why the currently proposed governance structure would stifle decisiveness – especially because Working Groups can come from anywhere and be proposed by anyone. This is especially important because the proposed governance structure has not been implemented yet and is designed to evolve over time based on operational experience and the needs of the DAO.

  2. Why giving two individuals nearly unlimited power to make fundamental decisions about the future of the DAO, along with access to significant economic resources – i.e., they can spend what they want unless people say no within 33 hours – is not a severe centralization risk, and better than the “top down” approach you are recommending against.

  3. What would motivate PHONON DAO token holders to “bond” their assets to an individual who is ultimately not accountable to them (from a practical perspective given current DAO voting history), and will not lead to a “cult of personality” which is the opposite of decentralization?

  4. The expected qualifications of the Consuls, how specifically they would be held accountable to the DAO and community, and how they would keep people who request funds from them accountable to ensure the fund are being well-spent. In the currently Working Group structure all of the details of projects, including expected milestones and results are determined ahead of time. Skipping these essential steps, in the name of “speed” does not seem a wise decision.

Thanks for putting this proposal together. I look forward to your response.

2 Likes
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In a nutshell, I think the idea that we’re going to set boundaries and standards for anything other than “how much money can someone spend from the treasury before it triggers oversight” is absurd and doesn’t acknowledge the amount of individual action that’s gone into the project so far.

I think the most capable and invested people should have the most say, and generally the org should stay out of their way. A 5 person council will not do this. Too much diffusion of responsibility. At least with 2 people, the buck stops on them and THAT is my point. Also I doubt there are 5 people here capable of effectively managing someone like phonongod or rake.

My fear, and maybe this is the elitist in me talking, is that forcing individual action to jump through administrative hoops, just so someone can claim to have an idea of what everyone’s doing all the time… that’s not an effective way to manage a bunch of renegade geniuses.

I’ll get back to addressing this throughout the day. I appreciate the feedback.

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Given the nature of the DAO and the technology behind it, and the arrangements that are intended with e.g. hardware manufacturers and certificate authorities, I feel the current snapshot proposal strikes a good balance between nimbleness, agility, quickness and important checks-and-balances. We will likely have formal relationships with external parties (including potential legal ramifications in various jurisdictions) and there will be a need to make business decisions that are based on careful, well-informed processes. This is not a “move fast and break things” environment when it comes to some of the core functionality and agreements that will make Phonon work, succeed and grow into a market force to be reckoned with. I do not believe the new Consulate proposal, as it currently stands, is as suitable to this context as the current snapshotted proposal. My 2 Sats.

1 Like
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why do you believe the DAO is incapable of electing 2 excellent consuls who can manage, but that it is capable of choosing 5 council members who can?

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It’s not the number of people that concerns me. It’s the structure they follow.

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The council members aren’t the ones doing the operational work, it’s the working Group leaders who are doing that, and there is no limit on the number of people who can engage there.

The current proposal – which your group seems to be rallying votes against – preserves decentralization and accountability. I don’t see how the Consul structure, which is highly centralized achieves that.

Your argument seems to be “there’s too much bureaucracy, let’s just appoint dictators who can ram stuff through based on their personal preferences.” That’s like preferring dictatorships over democracy because dictators “get more done.”

That’s the opposite of decentralization and a dangerous path to go down.

You haven’t justified why your approach is superior or desirable. The mantra that there’s too much bureaucracy isn’t enough.

Please justify why you think this approach is desirable beyond: “there’s less paperwork.”

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I echo all of @davoice321’s concerns, and look forward to Rooster’s reply to these questions.

Further, a common comment is “PhIP-06 can grow organically from this proposal, this structure can’t grow from -06.” The proponents of this proposal seem hung up on the idea that “organization isn’t needed now,” but are open to the idea that it would be in the future, once Phonon takes off. Why would we not install an organized framework now, before it’s needed? Why should we have to constantly scramble to adapt to organizational needs?

I am, admittedly, relatively new to web3 and DAOs. I am not, however, new to governance. I have served in countries with authoritarian regimes, and I have seen and analyzed first-hand the perils of weakly-defined governance structures. This proposal, while seemingly well-intentioned, concentrates power too deeply into the hands of few, without sufficient checks and balances. It would be far too easy under this proposal to create a network and cycle of cronyism where those with deep PHONON bags continue to scratch each other’s backs. We are seeing the effects of this right now where (as of the time of this comment) only four people with ~170 million PHONON have swung the snapshot against a more democratic proposal and a supermajority of voters who support it.

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I guess this is gonna be the sticking point, even after I get the structure all sorted out nicely.

I believe we can not predict what frameworks are needed and which are superfluous, and I know for a fact the best work done by the people who are here now has been in absence of one.

It is true that this governance will not scale to the vastness that phonon dao will some day encompass. A sunset clause isn’t written in because I’d trust the people we elect as consul to handle that transition with the insight they gain from actually being at the center of the things.

You don’t get to call people who are 6 figures deep in this “cronies” just because you disagree with how they voted. I resent the reference to third world countries and authoritarian regimes. These are your fellow tokenholders and they clearly don’t want to pass -06 until this has been given time to digest.

These are people. I woke up two days ago willing to vote for -06. I changed my mind when I thought of something interesting. I want everyone else to think about it too. Making this a “proposal vs proposal” argument and drawing up sides like it’s kickball isn’t what’s in the best interest for the DAO.

I’m offering a system that we would decide what to do with as we learned it, instead of trying to prescribe something on everyone just because it’s what I know. It’s a different take, and clearly jarring for some to conceive, but I ask that people give it some time to grow and take shape before starting into an us vs. them.

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this is wrong. We appoint lifeguards. DAO members should be free to float proposals and get a quick response. Bias for action. You put your suggested spend in the queue and unless a consul vetoes it, you’re good to go in 33 hours.

A smart consul will build a delegation system out, ask questions about spends that aren’t a sure go, and generally manage the thing with a hands off approach, creating groups to handle things as they arise instead of assuming what the DAO needs up front.

Their ultimate responsibilities are the checkbook and the public outlook. Within the DAO all sorts of structures should thrive. We have done a very good job self-policing so far I think. When the structure becomes too big for that, then we upgrade. The shrewd consul should always be seeking to make themselves obsolete.

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I dont like anyone saying “the only way work gets done on the project is thru this structure”.

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ANYONE can make a spend request on that 33 hour limit. The consuls can make that same request and as long as they both agree, it will be fast tracked. We can pick two people to do this job right, I think.

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What do you mean by “given DAO voting history”?

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That would be up to the voter… This puts the power of the hands directly in the people, from how I look at it. Consul role I’m imagining looks a lot like “my door is open, talk to me about anything but ops that are underway, I have the best people in place to handle that”

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Alright now, I’m not putting words in your mouth, and you’re not putting any in mine. I’m not saying those who are voting for or against this proposal are “cronies.” I was pointing out that an openly-defined system such as the one you propose, wherein those with the most money have the most authority, can devolve into a patronage system. It was just happenstance that three large PHONON holders were able to swing the vote. Full stop.

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Again, the current proposal does this, just with additional checks and balances against abuse.

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This position is a willful misrepresentation of what the current proposal accomplishes. The idea that “structure” stifles innovation and action is weak.

…until that person is elected and is able to do whatever they’d like unless the DAO can muster up an extra 33%.

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thats how votes work… since some individuals have more votes than others in this system, their opinion is weighted more.

the difference between this and cronyism and the reason I object to its mention is because the weight is earned by buying more PHONON, and anyone can do that.

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maybe I misread the proposal. You’re saying I can submit a payment request to the DAO and, if no action is taken it will be approved?

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The idea that a structure is necessary for innovation and action, or that those things should happen within a structure, or indeed must happen within the structure is what I’m against.

There are brilliant people here who need space to work. My proposal was intended to give them as much of that as possible.