Supervisor Functions from 0x46...8944 (Dec '22 - Mar '23)

Summary

This proposal discusses the importance of effective governance in decentralized systems like blockchain and introduces the role of the Supervisor in ensuring that updates and changes to the system benefit the entire network. It also proposes an incentive system for Supervisors based on the concepts of honesty, fairness, and automation, and outlines a two-phase plan for rewarding Supervisors.

Mission

The Supervisor is a software needed to call governance functions. These functions are called “Supervisor Functions” and include deploying community governance voting and scheduling protocol phases. The Supervisor is responsible for ensuring that the Eco protocol is upheld in a manner that serves the interests of the community.

In service of the protocol, the Eco Association is hosting an automated program that calls these critical state transition functions on a proper cadence, but any other actor is welcome to do the same for redundancy — there is no privileged access.

In the past, only the ECO Association operated a Supervisor service, which means that if their server went down, governance operations stop. The eco-system is more securely protected by the more Supervisors that are run by the community.

Details

Other than calling functions, there is no reliable way to determine whether a Supervisor is active. We would not be able to verify if operators who claim to have a Supervisor actually do so. The only way to tell if a Supervisor is active is if it triggers functions that can potentially result in a reward. To make up for all the times a Supervisor didn’t trigger a function and encourage the operator to keep maintaining the Supervisor, the incentive must be rational.

Since most entities are generally motivated by personal interests or advantages, an incentive system with a rationale offers advantages to attract participation. The financial incentive can be easily satisfied by adjusting reward amounts, and the eco-system may ensure that individual and group interests are aligned. Otherwise, participants can operate selfishly to maximize their own interests, which can lead to alarming scenarios.

The three main concepts on which the plan to use incentives for Supervisors is built are as follows:

Honesty - Dishonest behavior might occur if being dishonest provides benefits. A strong incentive should be able to motivate the participants to act honestly. Such a sincere incentive makes it possible for a system to function over the long term.

Fairness - An entity should be rewarded in a way that is commensurate with the contribution it made. The eco-system must be able to provide the participants with the necessary sum in a timely manner. Also, fairness promotes moral conduct and motivates them to contribute as much as possible.

Automation - Distributed systems like Eco require less centralized control for an incentive system to work with their decentralization. It should be automatic to reward triggering functions and distribute its incentives. Automation, which is usually accomplished by integrating incentive mechanisms into Smart Contracts, also eliminates the weaknesses in centralized incentive management.

Roadmap

The reward plan is based on a set of general requirements regarding properties and costs for evaluating the effectiveness of different scenarios. Supervisors have at least 8 fundamental actions to trigger per month but most likely the same Supervisor will not trigger all the actions. Some costs associated with the Supervisor include an average server, an Infura Developer Plan, and ETH in the Supervisor’s address to pay network fees for transactions.

If the incentive for Supervisors isn’t set properly, it could result in an imbalance of incentives and have a negative impact on the Eco consensus’ ability to function reliably. I suggest incentivizing each Supervisor for a maximum of three functions every 2 generations, equalling 1 month:

• 1st function = 5000 ECO
• 2nd function = 1500 ECO
• 3rd function = 500 ECO

To strike a balance between honesty and fairness, the reward should get smaller with each subsequent installment. If we overcompensate Supervisors, a race to maximize setup and surpass low-end setups may emerge.

As centralized third parties, the Builders will manage, organize, and carry out these incentive mechanisms. Nevertheless, in fact, they are not entirely trustworthy because rewards are not automated and must be requested in advance via an EGP if funds are not available. Additionally, the manual implementation of their centralized incentive mechanism adds extra time and complexity to the process of allocating incentives.

Team

This proposal is intended to honor the on-chain activity from the supervisor: 0x46Dc03769aa89D0754C788941C5DBFEff05b8944

Funds

This grant is worth 27,000 ECO for the on-chain activities in the months of December, January, February, and March. Additionally, 10,000 ECO will be granted for writing a technical explanation of how to set up a supervisor.

Month	1st Function (5000 ECO)	2nd Function (1500)	3rd Function (500)
Dec 2022	0x679ef62ffd5e36537855ffdc3756d5d50b48b64870dfe3b253ebc1844f0639c8	0x590cf8af030658576dd7a0f6c95431b7365fdf34de46255f1c3c05e15e3abbc6	—
Jan 2023	0x60a11ad2891f32044b90a687b271ff1bc8fbc0f03f4d5fc60698042beee6d2f5	0x6f3695d097b25a195ac733444133c091efd22c366a0045c281ef9a49c75b5b01	—
Feb 2023	0x76c2e487b8802892532e8e6704c200ab2cbd5a4f30b2fd78e331b6100442cc44	0x3aa413fc95d82fa8b740f5b8cffd696cac6e4e20e01a74c90c0b61f4a689bfff	0x04770cd23fca8e0e3d719e4022131fcda4a88786da520a9bafce403fc7a3d1c2
Mar 2023	0xf46d2802cbc0d3c62aa463602d51bf4160d647017e36090d25f908eb3c7a28d9	0x790a359cc87549c78ed29143b1573f1b37e129dde14f9553567a14e228065026	0xb9360e4467c775ae52315c7b42954e80e28ccce390ceb3facde71f12333ae04c

Destination

Please send 37,000 ECO tokens to this address: 0xfEa6186BEeFD1819Df77c724940a6f984905DD44