DXreGEN, Save Our DAO

dxDAO
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DXdao faces two threats.

First threat is a SLOW BLEED FAILURE, fruitless spending on contributors without meaningful delivery until treasury is empty.

Second threat is SPIRALING DXD REDEMPTIONS that completely drain the treasury due to the flawed DXD “token model.”

Let’s dive a little deeper . . .

Slow Bleed

To anyone paying attention to DXdao over the years, the first should now be obvious. DXdao has failed to ship meaningful products and things seem to be getting worse. Mesa deprecated and Aqua abandoned, Omen abandoned, Swapr only $650K TVL on Arbitrum, Carrot no recent progress, and perhaps worst is DXgov which has yet to ship anything besides a buggy-clunky version of DAOstack’s Alchemy. There has been no progress on Gov 2.0, which could perhaps have introduced some accountability. All this stagnation and yet DXdao’s budget for this year allocates over $1M to non-product roles as well as $1M to DXgov which has failed to ship anything. If the current direction continues, DXdao will simply continue to burn treasury funds until it runs out of money, whether that’s in 2 years or 10 years.

Treasury Spiraling Down the Drain

To anyone paying attention to the new “DXD Token Model” it is clear that under the current model the treasury will be fully drained in short order. The concept is quite simple. Every DXD may be redeemed for 70% of the current Net Asset Value of the treasury per circulating DXD. Every DXD redeemed increases the value of redemption of the next DXD, increasing the appeal of a redemption and accelerating the drain well beyond 70% of where NAV started. In addition, the $2-3M of spending per year and continued DXD rewards to contributors, alongside the languishing hope of product revenues, is acting to erode the NAV. So while there is some incentive to wait for other DXD holders to redeem first, people won’t sit around for long watching their value eroded by contributor spend. And the more DXD redeemed the more aggressive the erosion of NAV in percentage terms. Already 10K+ DXD has been redeemed, and there is every reason to believe this will accelerate and bring the treasury to zero quickly, with the last redeemers in this game of musical cheers reaping the greatest benefit of this foolish policy.

What can be done about this?

How can DXdao be saved from the clutches of bureaucracy and mismanagement? The answer to these problems is simple. Stop. Stop spending on non-productive contributors. Stop draining the treasury. Leave only the top 5 technical contributors and carve out ample resources from the treasury to give them a shot at preserving what is good about DXdao. DXdao contributors have already been funded through first half of year. This gives time for current contributors to show what they can ship, or to decide to find arrangements elsewhere.

Who can save DXdao?

It is clear that DXdao, through REP minting, has been taken over by contributors. There is clear resistance to accountability. OGs who were there from the beginning like John Kelleher and Corkus have given up and left. A bit paradoxically, contributors also appear to be asleep at the wheel when it comes to the treasury spiral.

Are we stuck in the clutches of contributor obstinance and apathy? Perhaps, but there is one last hope to SAVE OUR DAO. Most proposals are passed by “holographic” consensus, requiring first DAOstack’s GEN token to be staked, and then allowing proposals to pass by “relative majority,” i.e. having more votes for than against. Through downstaking GEN, it is possible to block this method of passing proposals, leaving only the ability to pass proposals by “absolute majority,” i.e. 50% or more in favor. This is our best shot to fix the problems above and give DXdao a fighting chance at survival. A multisig has been established to accumulate and utilize GEN to protect DXdao from the above failure modes. This is a CALL TO ACTION for all concerned citizens of DXdao to send their GEN to this multisig or otherwise support this effort.

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I think this post is a little misguided, if these are your views and you really want the best for DXdao then I think it would be far more productive to join in the discussion around direction and funding when those happen, you can find them all here on daotalk.

The claims of not shipping anything isn’t true, perhaps we can do a better job communicating what we ship and the progress of work going on beyond weekly meetings, release notes, etc.
Carrot has been busy preparing the next version whilst non technical attention is focused on branding and a go to market strategy.

We shipped a first version of Project-DAVI and guilds months ago and have begun this year using it as a way of giving DXdao squads more autonomy over their funding to achieve their goals. We’ve gotten great feedback most of which we iterated on and then delivered in fairly frequent releases.
This alongside what is probably the biggest change to DXdao in a long time, budgets, proper accountability. We laid out 6 month budgets where plenty of time was given for discussion and discourse if people had issues with them, for the most part there was no major disagreement like what this post suggests and actually, all criticism came from core contributors.

“No progress to 2.0” isn’t true. There have been posts on daotalk outlining our progress towards having 2.0 ready but maybe we could do more of those to further highlight it since there seems to be some confusion?
Currently, we have a major upgrade (1.5) in the final stages of audit by omega team and our DAVI roadmap aims to have it live on gnosis chain by end of Q1. In our budget we also set a goal to have gov 2.0 complete and off to audit by the end of H1, if that is not complete then I welcome any criticism but please do not claim no progress whilst the team works hard to deliver.

We also now have a priority board to make it even clearer what the direction of DXdao should be which is open to all stakeholder participation.

I would encourage the person behind “Make DXdao great again” to partake in the processes we have for discourse especially now with budgets where cost, goals and OKRs are clearly laid out. Instead of a call to arms to burn everything down, any disagreements with direction or deliverables would be far more appreciated at the priority setting and funding level where they will be far more meaningful.

I’ll leave the token model parts to someone more informed but the lack of this discussion during the long process of deciding on this direction makes this whole stunt look a lot like an attempt at a governance attack and I’d recommend people to not send GEN to that address.

Some links for those out of touch with DXdao product development:

https://twitter.com/ProjectDAVI

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To anyone paying attention to DXdao over the years, the first should now be obvious. DXdao has failed to ship meaningful products and things seem to be getting worse. Mesa deprecated and Aqua abandoned, Omen abandoned, Swapr only $650K TVL on Arbitrum, Carrot no recent progress, and perhaps worst is DXgov which has yet to ship anything besides a buggy-clunky version of DAOstack’s Alchemy. There has been no progress on Gov 2.0, which could perhaps have introduced some accountability. All this stagnation and yet DXdao’s budget for this year allocates over $1M to non-product roles as well as $1M to DXgov which has failed to ship anything. If the current direction continues, DXdao will simply continue to burn treasury funds until it runs out of money, whether that’s in 2 years or 10 years.

The sentiment of the post is agreeable. The DAO non-technical headcount has grown too fast for a small startup. Too many manual processes and non-technical titles led to this: HR and Contributor Experience, Business Development, and DXvoice.

The general thought should be amended: DXvote was put into maintenance mode after DXgov failed to add any meaningful value; an inefficient vesting system for contributors; Guilds is eleven months late by many accounts. The failure of Swapr to become dominant on Gnosis Chain; A handful of bad investments by BD squad; failure to hire and outsource DXdao’s outreach to external component entities in the space; and lack of technical talent.

On a final note, is it fair to use a safe with one owner when this post aims to save the DAO?

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Are you new to DXdao? Welcome.

Many are aware of what you are writing here. Not revealing any secrets.

I am intrigued and very open to hearing more about this.

Which five technical contributors should DXdao stick with and what exactly do you want them to do? What should they build and focus on?

If this can effectively deliver big revenues to DXD holders rapidly, that would be welcomed. Please share more.

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Ross, if you had shipped something you would point to the product and users. You will hopefully someday wake up to the fact that “proper accountability” is much more than having lengthy discussions amongst “core contributors” all in agreement. And that shipping is more than processes, goals, weekly meetings, release notes, OKRs, and “upgrades” used by no one. The only governance attack here is your use of a stifling bureaucracy to slowly drain the treasury through your fat paychecks.

It’s interesting to me that you don’t even pretend to care about this. What apathy. I thought I explained it above but let me make it as clear as can be:

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Do you understand now? Or do you still want to lecture on lack of involvement in such and such processes, about which you yourself clearly have negligent levels of understanding. To make sure there is no confusion, WHEN ALL THE CURRENTLY OUTSTANDING DXD IS REDEEMED, THERE IS LESS THAN $2.5M LEFT. How many more OKR meetings will that support? Maybe you think DXD holders won’t redeem because they have tremendous faith in your meeting your amazing OKRs? I have a wonderful igloo in Mexico to sell you.

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You must be the level 8 lead of the Patronizing Squad.

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Thank you for your thoughtful input. Ideally the Safe would have trusted members of the community which would enable confidence in people to send their GEN to it. Of course we can easily add members to the safe which currently only has one address. What I don’t yet have an answer to is how does this Safe retain the ability to execute quickly enough to be effective.

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So uuuh…Redemption is bad because it’s draining the treasury and will be empty soon?

But also, spending the treasury is bad and we should stop paying contributors?

So maybe the DAO should pick the 5 best devs and have them build a nice treasury dashboard that everyone can stare at, hoping number go up?

Now maybe you can talk a bit more about who you are and what your angle here is? You seem to be against both the interests of REP and DXD holders so I’m curious what outcome you are gunning for.

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Steelmanning OP’s argument: we are not spending the treasury wisely, but what if there was a way to invest the treasury more wisely than depleting it?

EDIT:
my question to OP is: how would it be spent wisely? Particularly if you don’t think it has been spent effectively up until this point, what makes you think it could be spent wisely from this point onward?

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This is a step in the correct direction. Execution speed will depend on a clear book for which proposals to downstake. Below are some suggestions:

  • Any proposal requesting funding for:
    • DXvoice: it is illogical to fund community/marketing when the DAO’s product canvas is. The DAO’s marketing strategy is to be refined without the current members of DXvoice. 160 hr/wk spent on marketing and community should be channeled elsewhere.
    • DXgov: Gov 2.0 signal proposal was passed in February 2021. Guilds, as mentioned above, is eleven months late. DXdao was promised Guilds to be delivered by March 2021; Copenhagen Flames sponsorship emerged from giving the team governance tooling. Many people question Ross’ ability to deliver on his squad’s promises. A good argument is presented above.
    • BD Squad: the argument against DXvoice applies.
    • HR and Contributor Experience: a DAO has no need for HR. HR work should be seasonal for recruiting purposes. Unless HR submits and processes payroll, having MDDHR and HR full-time on payroll is thoughtless.
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This is a step in the correct direction. Speed of execution could be outlined by Safe owners and stamped somewhere.

Below are a few suggestions. Prevent further funding for:

  • DXvoice: A DAO with no community and a squad with a total of 160hr/wk is an unwise use of the DAO’s funds, specifically when DXvoice squad members are on level seven and eight contributor compensation.
  • DXgov: The signal proposal for Gov 2.0 was passed in February 2021. As of this writing, Gov 2.0 has not been shipped. This squad has been funded since October 2021 to improve DXvote, only to later deprecate the project. The DXdao community should have a reality check on Ross’ ability to deliver. His squad failed to deliver Guilds when DXdao sponsored the Copenhagen Flames team on the premise that Guilds will be ready for demoing by March 2022.
  • BD: same logic applied to DXvoice.
  • Contributor X: a DAO has no need for HR. HR should be retained when required. Having MMDHR and HR on a full-time payroll is thoughtless.
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Respectively, paying a subset of nontechnical contributors is putting people on pensions for the reasons outlined in the previous post.

This is a better course of action when weighted against paying 33+ contributors.

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These are inane questions. YES ROSS. WASTING THE TREASURY IS BAD. Duhhh.

Ahhh sarcasm! Still doesn’t make you smart.

And to top it all off, let’s desperately try to find a diversion.

What I see here Ross is someone trying to avoid debating the actual ideas. But hey, while we’re focused on diversions, maybe you could explain how someone from Yams thinks they are the authority on REP and DXD holder interests. Did you run out of money to waste there and need a new project to pay you for asking useless questions?

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Great points. These seems like “no brainer” starting points to cease wasting money.

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DXdao has some interesting properties. Omen has potential. Carrot has potential. Swapr has some nice features and if it got modernized at the protocol level could be a contender on Gnosis Chain for dominance, and could maybe ride an Arbitrum token distribution to success. Governance 2.0 is also very interesting if it could actually be delivered. These are some thoughts to answer your question and hopefully enough of an answer to clearly demonstrate that DXdao should not be liquidated and left for dead. But, I’m not trying to be prescriptive on product direction. What I want to see fixed is the culture of waste. And it’s simple. With no real traction DXdao should operate like a scrappy startup. Cut down the spend to a core group of technical contributors and let them have a crack at getting traction out of the above possibilities or beyond. Obvious from the above responses in this thread, everyone who faces losing their fat paycheck wants to oppose this effort, but the best argument they have against it is “this is nothing new” and “before you dare ask questions you should be familiar with our bureaucracy.” The people with this attitude are the ones that obviously need to be shown the door.

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Could you explain this more? I was thinking maybe there is a Safe or Zodiac module that would allow whitelisting of the staking contract such that one multisig member can execute downstaking. The pre boosting period is not necessarily very long and I think it could become a problem if the multisig has to wait for multiple signatures.

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Thanks for the links. You still have several months of runway secured, so plenty of time to prove the skeptics wrong. I would welcome your success.

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slava DXdao)))))

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Perhaps it was not clear. A public post, outlining proposal types to be downstaked, should be publicized on this forum. The parties who delegate their voice to the Safe signer can amend these rules through discussion.