[HGP-69] Proposed Governance Changes for Epoch 12

Summary

As part of ongoing efforts to streamline governance, adapt to market conditions, and ensure sustainable funding for the Hummingbot ecosystem, we propose the following changes for Epoch 12:

1. Simplify Connector Polls: Consolidate the current three separate exchange connector polls (CLOB spot, CLOB perpe, AMM) into a single quarterly poll that decides which exchanges the official Hummingbot codebase should support and allocates HBOT maintenance budget across their connectors.
2. Raise Minimum Inclusion Threshold: Increase the minimum HBOT vote threshold for connector eligibility from 200K to 400K HBOT to account for the decline in HBOT’s market price and ensure stronger community consensus for supported exchanges.
3. Set Maintenance Budget for Q2-Q4 2025: Allocate 18M HBOT (based on ending 2024 HBOT price of ~$0.0015) to fund maintenance initiatives, with 9M HBOT allocated to quarterly connector polls and 9M HBOT reserved for the Foundation’s discretionary use (including periodic buybacks to mitigate dilution).

Each sub-proposal will be implemented only if it receives 50% approval from participating HBOT holders, provided the overall proposal meets quorum.

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Sub-Proposals

1. Simplify Connector Polls

Current System:

• Epochs currently include three separate connector polls (CLOB spot, CLOB perpe, AMM), each requiring voter participation.
• It requires classification of connectors into one of the three categories.
• The top 4 connectors in each poll receive maintenance budget proportional to their vote share, but other connectors receive no maintenance budget.

Proposed Changes:

• Merge into a single quarterly "Exchange Connectors Poll" where HBOT holders select exchanges rather than individual connector types, with each exchange vote determining support for all its connector types that Hummingbot supports (spot, perpetual, AMM, etc.).
• Pro-rata distribution: Connectors receive funding proportional to their vote share, with a per-exchange cap of 1M HBOT to prevent over-concentration.
• Reduce duration to 7 days: Shorten the voting period from two weeks to one week to streamline the governance process.
• Minimum vote threshold: The minimum HBOT vote threshold (see below) applies on a per-exchange basis, rather than per-connector type.

Benefits:

• Reduces governance overhead: Fewer polls mean higher voter impact per vote.
• Funding for long-tail maintenance: All included connectors receive funding proportional to their vote share.
• Flexibility: Removes rigid connector-based systems, allowing growth into new connector types without additional governance.

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2. Raise Minimum Inclusion Threshold

Current Threshold:

• Connectors must receive 200K HBOT votes to qualify for funding.

Proposed Change:

• Increase the threshold to 400K HBOT to:
  • Account for HBOT’s price decline: The threshold’s USD-equivalent value has dropped significantly since inception.
  • Ensure meaningful support: Higher thresholds reduce "noise" from low-engagement proposals.

Rationale:

• Aligns with current token economics: The original 200K threshold was set when HBOT was ~$0.005 in 2023. Now that the market price is ~$0.0015 and lower, the new threshold maintains a more balanced bar in USD-denominated terms.

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3. Set Maintenance Budget for Q2-Q4 2025

Proposed Allocation:

• Total budget: 18M HBOT (6% of remaining community supply), split as follows:
  • 9M HBOT (50%): Allocated per exchange via quarterly polls (3M per quarter) and used by the Foundation on developer bounties to address maintenance needs of each exchange's connectors (bug fixes, API updates, etc).
  • 9M HBOT (50%): Allocated to a general maintenance fund, used by the Foundation on developer bounties covering:
    • Core Hummingbot client
    • Environment, tests, CI/CD
    • Integrations (e.g. Telegram, TradingView, etc)
    • Other Hummingbot repositories (dashboard, quants-Lab, brokers, hummingbot-site etc.)

Buyback Mechanics:

• Foundation will do periodic purchases of HBOT to balance supply emitted via developer bounties
• Each purchase will be reported in the HBOT Purchases tab of HBOT Tracker
• Rationale: This ensure HBOT has sufficient economic value