Genesis Beta - what do we want to be

Stratis · February 5, 2019, 8:35pm

During the Genesis call of Feb 5th, Matan presented some topics about the upcoming launch of Genesis Beta.

I’d like to particularly touch on the subject of reputation and economic alignment with GEN.

Among others, two of the things mentioned (as suggested/potential changes to the reputation system) were:

Awarding reputation for those who lock some GEN tokens
Awarding GEN tokens to reputation holders (something like making them stakeholders to the project and paying out dividends)

I’m opening this thread to make sure we start a discussion on these two specific suggested changes.

Important note: Matan said that there are no detailed plans on how to actually make this implementation(s) e.g. he didn’t suggest how much rep someone should get for locking tokens or how much tokens to lock etc and this is just a preliminary discussion!

Stratis · February 5, 2019, 8:36pm

Something I wrote on Telegram regarding this:

I wholeheartedly disagree with connecting voting power with any sort of monetary incentive or disincentive. Historically this has never worked in the long run for any society. That’s why, regardless of political system, political power always concentrates around wealth centers.

Ultimately and simply, people should be “reputable” by doing directly reputable things i.e. contributing directly to the DAO.

Locking tokens also doesn’t account for the economic disparity between all the different token holders. (Locking 1000GEN for someone in Los Angeles is probably less way “hurtful” and “skin in the game-ish” than someone in Uganda). I just don’t see any fair and practical way where we can take into account all of the parameters to make this right.

Also, someone being able to have the same reputation as me by just locking tokens while I’ve been busting my ass off for the DAO by doing actual work is infuriating, unfair and disgusting. (1st person used as figure of speech)

parrachia · February 6, 2019, 2:55pm

I think we should write a proposal to actually fund this discussion. be it a bounty for comprehensive contributions or a normal proposal for some simple delivery on the subject.

papa_raw · February 6, 2019, 5:06pm

This is an important topic to incentivize, I agree.

My suggestion is .5 ETH for a 1-3 paragraph response.

Stratis · February 6, 2019, 5:11pm

Some follow up thoughts.

Token locking for rep:

It’s not a good enough incentive on its own to prove intent and alignment (it certainly doens’t work “for everyone” and it could only work if we came with some super sophisticated way to set it up)
It directly hurts actual contributors (i.e. people who’ve spent their time to create actual value and who’re actually invested in the DAO - these people are most likely to already be GEN holders, too, since they’re using GEN to stake). Pay-to-win community models & games are infamous and usually hated.
It’s not convicing enough that it will be good for the GEN economy, since it only creates virtual value and pumps the price because of scarcity. Alternatively, the strength of the GEN economy could increase by getting more people to stake (i.e. use GEN directly and ongoingly) and build a better ecosystem, platform, app
It introduces presently unneeded complexity to an already super complicated system
There are better ways to prove intent and align incentive, like having people actually and directly contribute to the DAO by creating value and solving problems for it
If you think about it from an anti-rivalrous economy perspective, e.g. open source code or mathematics, would you want your most reputable developers or mathematicians to be actual contributing members of society or just some people who had extra money and decided to save it on the side “in the name of science”
It raises the similarly impossible question to answer: should rep holders get tokens? (mirror mechanism)

Overall, I think token locking for rep is a recipe for disaster with unconvincing upside. Bad risk/reward ratio.

parrachia · February 6, 2019, 8:09pm

Done
Also this

papa_raw · February 6, 2019, 8:48pm

I’m a fan of model A – but a few thoughts:

(1) I don’t believe locked GEN should be allocated more than 15% of the DAO’s Rep, in terms of yearly inflation, and it should be eventually linked to a GEN/USD oracle with a diminishing allocation of Rep for higher values of GEN. Inflation, to me, seems good – it stimulates growth through alignment with the GEN economy, incentives Rep holders to submit proposals to ‘keep up,’ and offers a passive means of supporters to support the project.

(2) I believe we should identify and allocate Rep to desiring ‘agencies’ in chunks.

Some examples that come to mind: dOrg, Greater Than, the Carribean Blockchain Network, Gnosis, DAOstack Technologies, Horatii Partners, the ATF, Bushwick Blockchain Hub, DGOV Foundation, the dxDAO.

I realize it would take extra effort to do this, but I think it matters for ‘seeding’ the ecosystem. Some of these agencies are quite small, but that doesn’t mean they can’t grow, and recognizing that the Pollinators is not just a coalition of individuals but actually of many small teams would be, in my opinion, a more meaningful representation of reality of Genesis’ current composition. Additionally, creating many sub-DAOs would accomplish a dual task of testing how these agencies interact with other large DAOs as well as each other. I would even be open to some sort of application process to see what other orgs would be interested in joining this next phase of experimentation.

I elaborate on this tactic in mine and @Ezra’s Reputation sharing article under the Promotions section.

(3) The mgmt of 40m GEN should be explicitly conditional upon some sort of measurable goals.

I don’t want to see the “key” to the 40m GEN vault held over the heads of the DAO by subjective judgment. I want this “key” to be explicitly conditional with goals and a roadmap in place. These goals should cover many bases: security, ecosystemic growth, number of active stakeholders … etc.

This is all I have for now. But thinking about this is an enormous task, and we should make sure it is not rushed. I already feel in some respects it’s moving too quickly, and we are thinking too ‘inside the box’ about how this should be realistically and strategically executed.

floridiano · February 6, 2019, 9:02pm

The recent announcements about the structural changes in consideration definitely deserves a closer look. Mainly because the changes to the tokenomic structure will have an impact across the board: participation, objectives, financial sustainability, pace of dev, attack vectors etc. But among the set of proposals for Beta, I believe the most significant is the Reputation minting for Gen stakers(lockers). My ideological starting point is that this is an extremely disruptive idea to the community which was created by the Genesis participants and even set a bad precedent and a sticky architecture.

But, when i try to look beyond my ideology, i can think about how this would actually work. If the right structure is built(a version of which i will propose later on) there could be experimental value in testing conviction based sustainability for these organizations which heavily rely on funding(as Genesis we sometimes forget how much that can be a problem). So overall, executed correctly, this can be a very valuable experiment(with a high risk of failure) for the future of a sustainable DAO ecosystem.

I think the important thing while we are facilitating this transition is to create “defensive mechanisms” for a hostile capitalistic takeover scenario.

One thing i would propose would be to create a whitelisting structure around the issuance of these contracts(Gen>lockup>Rep). This can be a default feature in every DAO, some can close down the issuance completely(anarchist dao), some can be very objective oriented and incentivized lockups(entrepreneur dao).

Let me just break down the process to be more clear:

DAO controls the whitelist (applications to mint DAOs token with GEN)
Stakers make a proposal
DAO votes based on the application acc to local metrics
If approved DAO creates the contract (kinda like the dry voting we do on Genesis for rep requests essentially)

I think this is important for two reasons:

DAO can express its selection and maintain coherence in participation
The time required for vetting slows down a potentially “high-frequency” process (financial assets:)) which can lead to undesirable situations.

I guess, in closing, every little thing we are doing since the beginning has been an experiment. This is not to say we should blindly experiment or all experiments are equal. But we can definitely think in productive criticism towards undesirable situations by creating better governance mechanisms which can insulte the negative effects but leaves space for a variety of experiments to take place.

p.s: really like Pat’s rep ceiling idea

–Cem

papa_raw · February 6, 2019, 9:05pm

A curated whitelist of approved locking addresses is a brilliant idea. Thank you for bringing this to the table.

ezra_w · February 11, 2019, 3:13am

Just catching up a bit on this stuff now. Great thoughts so far.

About GEN locking for Rep:

How good GEN locking is at indicating value alignment with Genesis depends on what Genesis’ values are. If Genesis’ main value is simply raising the price of GEN, then locking GEN shows value alignment pretty accurately in theory. Given what has already happened, though, (and this was probably always inevitable) Genesis has a much more specific culture than that. It’s obvious from any Genesis communication channel that members are generally interested in more than just GEN price (diversity, research, etc.).

Genesis’ current culture, however, has developed in a bubble. The community has been privileged to get steady funding from DAOstack with very few strings attached (so far), and I’m sure that has affected the culture meaningfully. This financial guarantee isn’t going to be there forever, and whenever that rug gets pulled out from under us, there will probably be a culture shock as Genesis suddenly has to start thinking more seriously about funding itself or fulfilling some stricter requirements imposed by DAOstack.

Locking GEN for Rep is one way to hasten this culture shock, since it would allow the people currently invested in GEN, who are probably more motivated by GEN’s price than Genesis currently is, to get Rep easily. So, some questions:

In the Beta, should Genesis start to take more financial responsibility for itself, heading towards either self-funding or DAOstack giving Genesis stricter funding rules? (I think this is the more important question)
If we do want to start that process, should Rep-for-GEN-locking be part of it, or should different steps be taken?

Right now, I think that a healthier way to start this transition (if it’s even the right time to start it) would be for DAOstack to impose some clear rules about Genesis’ funding to start with. Give Genesis some clear goals it’s expected to meet and some financial incentive for meeting them, maybe. That way, the current community could try to start taking this step itself. Dropping in a bunch of new people who are likely not very value-aligned might be dangerously disruptive, even if it would eventually push the culture in a direction it needs to go.

As a side note, a Rep-for-locked-GEN system might make Genesis scale faster, since there would be a simple, instant way to get Rep. A larger Genesis is useful since it might lead to higher productivity and better protocol testing (holographic consensus is meant for huge communities).

Caamper · February 12, 2019, 8:49am

Hi, first of all very interesting inputs and some of it actually went above my head, so I can not comment. But how I see it, I believe a incentive needs to be figured out how I will be rewarded monetary for putting down time in a project. And to securely follow up your activities like a milestone completion system. Speaking for my self if I will put let’s say one day a week in contributing a part of that needs to be reflected in options of future value. That is what is motivating me to be a shareholder of DAO economicorganisations.

Stratis · February 12, 2019, 4:30pm

5 Ideas on tying rep to GEN and rewarding participation (that don’t include token locking for rep)

Directly get rewarded with a small amount of rep for staking GEN on proposals (this can probably work even if you don’t currently have reputation)
Get a “rep boost” proportional to the amount of GEN you stake and/or have staked in the past i.e. you get rewarded with more rep than normal during “rep generating events” (like passing or voting on proposals)
Get a “rep shield” i.e. your % rep doesn’t change (you’re protected against rep minting) for a certain amount of time after you’ve staked GEN above a specific threshold
Rakeback: Periodically get some GEN as rakeback reward, as a function of GEN you’ve staked in the past, GEN that have been staked in general and available GEN in the DAO wallet
Get a “GEN boost” proportional to the % rep you have i.e. if you’re relatively more reputable than others, you have a reward multiplier for successful stakes

Dmitry · February 12, 2019, 7:46pm

It’s a question of control: who controls Genesis’ funds. Those funds can not be thrown to community uncontrollable, what is quite understandable and plausible cautious approach.

But instead of maintaining an inside control pull, I suggest establishing a transparent balance of influence and orderly decision making:

balanced influence on decision making.

Should main contributors (first of all team and then pollinators) be awarded with reputation? Sure. Should gen holders who have held gen for about a year be awarded for their patience and belief? Sure. But that should be done in a well balanced manner —

a) gen-holders, who had held gen long enough (e.g. a year) receive rep against their locked gen as a one-time contribution to “equity capital”, and

b) total amount of gen-lock rep holders should be limited to some quota from 15 to 25% (for e.g.), and/or having a decisive voice on spending huge amounts of Genesis’ gen.

In principle, Historical analogy is British Parliament with its House of Commons (rep holders) and House of Lords (gen-locked holders) each with its own jurisdiction and remit.

settled procedure of decision making.

I again call for some Oder in pre-decision process (I did it in late Research group). Mixture of rep- and gen-locked holders will confuse community even more and can lead to incomprehensible chaotic proposal submission, staking and voting.

My previous suggestions were:
(1) limit the right to submit any (!) proposal one can imagine (have several templates with limited amounts of funds to be spend);
(2) have a short pre-check stage for verifing compliance of a proposal;
(3) fix a mandatory discussion period about three to five days before submitting a proposal;
(4) give time for staking for and against a proposal before it gets boosted;
(5) dont let vote on proposals on which rep.holder had put a stake;
(6) make blind voting when voters do not see the current voting score untill the end of voting period.

Kate · February 13, 2019, 1:54am

I like this last point Dmitry - we’re spending a lot of time concentrating on fixing the quality of proposals by tinkering at the economic level - as you point out there’s many other things that will provide the scaffolding for better proposals and decisions which are 'aligned with the Purpose of the DAO (IMO the lack of a clear Objective is the most needed, and most lacking component of all the work we’re doing and questions we’re asking). I think some of this work was being done, slowly but surely in the Genesis DAO - particularly from you and @floridiano and @parrachia

Will rep buying and gen locking mechanisms necessarily improve the types of proposals being made? Maybe - careful design could create more fluidity and alignment of incentives (particularly once the high level purpose of a Funding DAO is clearly articulated - beyond just raising the value of Gen) - but there is also a lot more that we can and should be doing around product design, process design, communication and practise to also raise the bar on proposals and voting - this is the work of an ecosystem builder DAO.

rstef · February 13, 2019, 9:59am

From: Avoid Blunders in Designing Reputation Systems https://medium.com/metacurrency-project/reputation-is-orthogonal-to-exchange-f113a51dab6c

“Here’s the crux of it: Reputation currencies do NOT operate the same way as monetary currencies.”

“You do not spend or trade reputation. Once you earn it, it is yours.” (bolding my own)

Staking Gen to acquire Rep does not contradict these arguments. If someone spent their personal wealth on acquiring Gen tokens, and then staked them for a period of 1 to 12 months in a contract that is at risk of being hacked resulting in the loss of their investment, that is the definition of taking actions to earn respect. Here Reputation is not bought, as they get back their Gen tokens. And once acquired, the Rep cannot be sold or transferred.

Furthermore, as an agent centric model Holochain can tie reputation to identity as their defence against bad actors is removing them individually from the ecosystem. Blockchains do not have this same defence. Blockchains require incentive structures to protect against bad actors from stealing in the first place. So reputation here is not about who you know is smart and/or trust the intentions of, instead it is incentive structures designed to promote friendly behaviour between the appropriate parties.

“There are so many ways that different types of currencies can be woven together to create powerful connections and reinforcing relationships. This is really the uncharted frontiers of creativity.”

Question which parties are most important when it comes to “reinforcing relationships?” Or reputation between whom is most critical?

“Typically there are a few agreements or expectations which make interactions work. When creating a reputation system, that’s what you want to focus on. Imagine you wanted to design reputation currencies for eBay.”

Who are the agents of economic activity whose opinions/votes would be important in eBay? The sellers and buyers. Who are the agents that drive economic activity within DAOstack’s ecosystem whose opinions should matter on its operation? The Gen Token Holders and the DAOs they are curating. Should the alpha testers of eBay have any say on business decisions after it is launched?

Happy engaged Gen token holders are absolutely critical to the success of DAOstack and all the DAOs that launch on this platform as per the role they play in curation. The alpha testers are not.

It is not personal. I fully support all alpha testers to stake Gen or to continue to be active to earn Rep during a similar 1 month initiation period as dxDAO. But the incentives have to be properly aligned for long term success.

If the alpha testers of eBay had no financial interest in the success of the company and remained the primary decision makers, the bigger their budget becomes the greater their incentive is to become rent seeking middlemen. Why design it so that over time the incentive structure works against you? This jeopardizes the long term success of the business as the community of economic agents could leave to remove these middlemen. If you align the Gen token holders as the primary decision makers then the more successful the operation becomes the more incentive they have to keep it going.

Kate · February 13, 2019, 8:51pm

I don’t know if the intention was ever to enable Pollinators to become the primary decision makers in Beta - the intention was always to reset reputation but perhaps make some allowance for very active Pollinators who had spent time and energy in the DAO to now, and of course the intention was for it to scale from 100-200 or so (with about 30 very active) to many many more.

A question - what is the archetype/user persona of a happy, engaged and ‘useful’ Gen holder? How might we see them engage? What kind of proposal might they make?

rstef · March 3, 2019, 2:17am

[quote=“Kate, post:16, topic:388”]
what is the archetype/user persona of a happy, engaged and ‘useful’ Gen holder? How might we see them engage?[/quote]

For someone to want to buy, hold, and use Gen they would want to know that DAOstack is designed to be successful. That means funding DAO Rep holders who will not drain unnecessary resources to make decisions. Rep holders who are incentivized to be active by making Gen appreciate in value. Ones who’s interest will not fade over time. This means a system that will find ways to allow Gen holders to become Rep holders. I see the opposite happening here. People want to prevent Gen holders from staking to get Rep. And they want to apply restrictions on their ability to use Gen to get Rep based on how long they have been holding it for. You want to attract new Gen holders and make them happy. Not the opposite.

What kind of proposal might they make?

I don’t really see this as being a proposal issue. Proposals at this stage are for testing. The testing DAO should not have governance over how DAOstack chooses to decentralize itself.

It’s my hope that when DAOstack resets the Rep and creates a funding DAO, they use GEN as the primary method to allocate Rep in it. Stake Gen to earn Rep. Have that Rep dilute over time and have reload periods of staking to replenish Rep. Over time Gen will be sold and it will further decentralize itself as necessary during the reload periods.

ezra_w · March 3, 2019, 3:57am

I basically agree with this – some Reputation-to-stakeholder mechanism needs to exist in any DAO that successfully serves as the “center of the GEN ecosystem.” There are lots of details that could be up for debate, but the main Rep holders in this DAO need to be real stakeholders in the ecosystem, not just people who are interested (eg. I would argue that not just holders but also regular users of GEN should be included as stakeholders, with maybe even slightly more weight on the users, but that’s neither here nor there for the larger point).

However, there are lots of ways we could get there from here. The current Genesis could transition into this stakeholder-focused DAO over time through things like adding GEN-staking-for-Rep, but that transition might end up just alienating current members. It could also become DAOstack Technology’s grant-giving DAO, funding projects that benefit DAOstack specifically (with the GEN-focused DAO existing separately) – but that would require DAOstack team members to take a much more active role and to hold a higher percentage of Rep in my opinion. Another option is for Genesis Alpha to fork and become completely independent, which would best preserve the current culture but would mean no more funding from DAOstack.

Edit: Another thought is to turn Rep holders into stakeholders somehow, perhaps by just giving anyone who has Rep GEN.

dOrgJelli · March 4, 2019, 7:27am

What a fantastic thread! A few thoughts…

I agree w/ @Kate that higher proposal quality and increased work throughput could come from clearer objectives. An implementation that comes to mind would include road-maps with funding buckets.

I think of these as “work-streams”. Work-streams could be spun up and proactively funded by DAO(s). This would provide a way for DAOs to (1) signal objectives, (2) facilitate aligned agent & DAO collaboration, (3) increase economic reliability for workers, and (4) distribution reputation for the funding DAO(s) to the aligned agents.

One could extrapolate an Agent or DAO’s narrative by looking at what work-streams it’s chosen to contribute to in the past month.