EGP-33: On-Chain and Snapshot Quorum Raise Proposal

EGP#: 33

Title: On-Chain and Snapshot Quorum Raise Proposal

Author(s): Mr. Sal

Type: Protocol Proposal

Status: Proposed

Date Proposed: <2024-10-14>

Date Ratified: <yyyy-mm-dd>

References

• https://docs-delv.gitbook.io/element-developer-docs/governance-council/element-governance-proposal-framework/the-governance-process/on-chain-voting-information

• https://snapshot.org/#/elfi.eth/proposal/0xced7b92df0c707c3524a575e66a17f91587b5a8d892868ea53879548e792b6f0

• https://mirror.xyz/0x3fcAf7DDf64E6e109B1e2A5CC17875D4a5993F39/bctuLRkf7oBL4mMJ9lPf0y0blFjBDslTUfUL0CEk1gc

Sentence Summary

This proposal is to raise the On-Chain and Snapshot quorum from 1.1m voting power to 2.77m voting power.

Paragraph Summary

For any proposal to have validated results through the governance process, whether it is a Social or Protocol proposal, it needs to meet quorum. When Element DAO launched two years ago the default quorum was set at 1.1m voting power with an initial ratio between quorum and float (circulating supply) of 9%.

This proposal addresses the change in voting power delegation since the launch of the DAO. Since there is more circulating and delegated ELFI due to vested and vesting DELV team members and investors there is a need to raise quorum.

Motivation

The reason to raise the quorum isn’t only due to more circulating ELFI, but also to avoid the risk of self-passing proposals. Since the current quorum is low, a delegate with over 1.1m voting power can pass any proposal themselves. The 2.77m figure is also a temporary solution, in the future there could be a dynamically moving proposal quorum based on circulating supply and delegated voting power.

Specification

To find the new proposed quorum the total available voting power is calculated and then multiplied by 9%. This new quorum doesn’t account for voter apathy or vested ELFI remaining in the vesting vault that has not yet been withdrawn. As a result of the previously addressed uncertain variables, a 25% discount has been applied to the calculation.

There is 40,980,698.22 available voting power considering the voting power that's in the locking vault and tokens that are unencumbered. This also includes the vesting vault (which has a reduced voting weight being 5% of the total grant size) and excludes the foundation's ELFI outside of the 2m approved for the foundation to vote with.

Quorum Calculation (as of 08/08/24):

New Quorum = Total Voting Power x 0.09 x 0.75

New Quorum = 40,980,698.22 x 0.09 x 0.75

New Quorum = 2766197.12985

Rounded New Quorum = 2.77m

Proposed Code

https://github.com/GregTheGreek/Element-Finance-Scripts/pull/21

Next Steps (Voting Outcome Summary)

1. This proposal is currently a Draft.

2. Once the feedback has been addressed, this will move to be officially Proposed.

3. Once Proposed, there will be a 1 week review period before it moves to the next stage, Off-Chain Poll (Snapshot).

4. On Snapshot, the governance community will vote for:

   • Yes: You agree that EGP-33 should be accepted.

   • No: You disagree that EGP-33 should be accepted.

   • Abstain: You formally decline to vote either YES or NO.

5. If this proposal passes the Off-Chain Poll, it will proceed to the On-Chain Vote, where the vote options will remain the same as on Snapshot.

6. If this proposal passes, the proposal will officially be Accepted and the code will proceed to the Execution

Note: In relation to this proposal to raise quorum, there should be a consideration to raise the proposal threshold from 55k voting power to the GSC threshold dynamically in addition to raising the GSC threshold to a higher amount of delegation such as 300k+. This can help address the current rise of ELFI in circulation.

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