FIP-51(cont): Amended Fei|Rari Merger Proposal & FIP-XX: GFX Labs Compensation

Proposals
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Hi all - Protocol Engineer at Connext here. Here’s my proposal for the unification process of the Rari and Tribe DAOs, amended from the original proposed by GFX Labs.

Summary
Two snapshot votes have been created - one for the overall merger plan, and one regarding the compensation for the work done by GFX Labs.

The merger plan will proceed as outlined if and only if the snapshot passes on both Rari and Tribe snapshots.

The merger plan has been amended with a few small changes and numerous formatting fixes, along with added details that were missing in the original proposal.

Motivation
The Fei / Rari merger proposal should only concern the unification of Tribe and Rari Capital governance, and not the immediate partnership of a third-party entity such as GFX Labs; splitting these two into separate proposals allows for an efficient governance process and helps us proceed with the most community-supported options.

I have created, along with community assistance and input, the two proposals herein with these thoughts in mind.

Links
Amended Merger Proposal Document: https://bafybeia52gtifubkk7tn5zgszp5oyopjgt3bgowkhrgb4p7y34mcicncnu.ipfs.infura-ipfs.io/

Rari Merger Proposal Snapshot:
https://vote.rari.capital/#/proposal/0x5e2d3b961cb9a2bb478e3cbac4437fbb722c5254e37ae9d7ef8d4c972b0e2613

Tribe Merger Proposal Snapshot: Snapshot

GFX Labs Compensation Proposal Snapshot (Rari):
https://vote.rari.capital/#/proposal/0x6d0f619b4c4aa07f26683e7965aad3a2f6da4592e10809b0d3f6df4e5fcdee4d

GFX Labs Compensation Proposal Snapshot (Tribe):
https://snapshot.fei.money/#/proposal/0x9f6f7cc792b83663860fd0b422c0dbcd26879b09f40bfb7b623080d564409f1d

Original Rari Forum Post, Joey:
https://forums.rari.capital/d/177-feirari-token-merge

Original Tribe Forum Post, Jai:

Rari Forum X-Post:
https://forums.rari.capital/d/186-amended-feirari-merger-proposal-gfx-labs-compensation

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Hi, I believe that there are still important points that are unaddressed in the fei rari merger thread, and a vote is premature.

Also I believe the main thread has not gone into last call, and this thread has only been posted without the obligatory discussion period, therefore the snapshot that was posted is in contrary to governance conventions.

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Hey @cozeno - I think you’re right that there are unaddressed points, but I’d like to make the point that there will always be unaddressed points, as consensus will never be had fully on a merger of this size. Eventually, governance needs to move towards some kind of agreement.

I think the best path forward for those that are in favor of the merger but might have some particular sticking points they’d like to get changed would be to propose amendments to the current proposal (if it passes) as further snapshots if and when this current proposal passes.

This would give the community the opportunity to vote on specific line-items things that they care about, and allow individuals that care deeply about a particular item to have their voice heard very clearly.

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I agree. Not cool that process wasn’t followed here especially for such an important vote.

In general, any snapshot that passes quorum and isn’t literally malicious should be enacted in good-faith effort unless it is purely a temperature check.

Because the snapshot is non-binding (on-chain is binding), I am in favor of moving forward using the current snapshot and opening an amendment window post snapshot if it passes

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i think thats very reasonable. Though the wording of the current snapshot makes it that it is a vote in favor or against the merger enacted exactly as proposed in their document.

for such an important vote, I am sure people far in the future would examine the entire process and perhaps even write about it in future business school syllabi.

Therefore I am in favor of making sure that this entire process is made regular to the utmost of our abilities. I believe that reposting this snapshot, and clearly rewriting it to indicate that it is only to agree in principle, and there will be an amendment window, is the correct course of action.

Better still would be to outline the amendment window, and scope of potential changes clearly now.

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Hi @cozeno, @joey,

I agree with the line of reasoning here. However, I’d like to present some points of clarification.

The ultimate goal of this proposal was to provide an opportunity for the community to reach alignment on whether we wanted to move forward with the agreement at hand - and separate out what didn’t feel loyal to the nature of that discussion.

This proposal is not intended to circumvent any informal due process expected by the culture here, nor to rush any binding actions (especially since that wouldn’t be possible on snapshot alone).

What this proposal is deciding is the mechanism for unifying two DAOs, should there continue to be consensus to do so. Any legitimacy and minimally-binding properties this proposal document may hold are continually decided by the community via their ongoing participation in the process it outlines. One might argue that the statement that ‘this proposal is intended only to agree in principle’ is redundant. Furthermore, the lack of an explicit amendment window only opens the door to increased flexibility for near-future adjustments - flexibility that translates directly to a wider decision matrix and therefore more voter empowerment.

It really goes without saying, but: a merger is huge. A merger between two DAOs (one of which boasts the largest-TVL DeFi platform)? Massive. The fact that it may take multiple steps involving corrections, amendments, decisions, and changes should not come as a surprise to anyone involved.

If this action feels rushed, it may be because I felt personally motivated by the mounting pressure of the controversy surrounding the (sidetracked) topic of compensation in the previous thread. I grew concerned that Tribe members may be forced into a Pareto-inefficient vote that, diluted with outside interest, would not fully represent the true nature of the governance action at stake. Therefore, moving quickly to officially separate those topics, I believe, was in the best interest of the community.

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This is well said. I’m certainly comfortable with how everything has transpired so far and grateful for your involvement @jake

Want to encourage other perspectives here but overall totally good from my view.

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There is a reason why proposals have to be in “last call” for 2 days before going to snapshot, and the fact that we have not been able to review the document in detail & comment on it before it goes to vote, in my opinion, makes this snapshot nil. Not everyone bothers to read 13 pages, and the forum discussion / summaries written here are important to allow people to know what they are voting for.

The proposal is presented as only clarifications & formatting changes & splitting out GFX Labs compensation to a separate discussion, but it includes significant design changes that I believe will be dangerous to the protocol’s good health, let me detail below.

The RageQuit design now uses :

  • Protocol Controlled Value / TRIBE supply,

Instead of :

  • Protocol Equity / TRIBE supply

It is very dangerous because if enough token holders exit, FEI could become undercollateralized.

Using the current pcvStats : 1200M PCV, 355M circulating FEI, and 619M TRIBE => The RageQuit would give 1.93 FEI/TRIBE to everyone, while the original proposal would give 1.36 FEI/TRIBE to the first ragequitters, then less to the following ones.

Judging by the amounts of votes on the snapshot, and the “hidden” changes of the proposal, this looks like a proposal designed by large TRIBE holders who want to ragequit. Voters in this situation don’t care about the health of the protocol or the state of the DAO post-merge, so the incentives are very wrongly aligned.

I’m starting to think that tying the ragequit to the merge vote is a bad idea.

Perhaps, like we did for GFX Labs compensation, we should separate ragequit out of the proposal, and only vote on details related to the merge. Then, if we all agree to merge, we can snapshot amendments to discuss details like ragequit, vesting, etc.

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In case this is not clear, I voted against on the snapshot

image

We are this :pinching_hand: close to flip the vote, so I encourage everyone to do the same :joy: even if I don’t think this snapshot should be valid, per the governance process.

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the change to protocol value from protocol equity here is a clear typo and unintentional. will have to fix via amendment or resubmit.

(The last sentence of the intrinsic value section does say “protocol equity”, so it’s clear that that is what is meant)

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If it’s a typo and we amend, I guess that’s fine.

I’m not happy with how the governance went here, not respecting the delays and not taking comments. Building a document behind closed doors and submitting it as an “all-or-nothing” proposal to the DAO is not how I imagined we would draft a proposal with such high stakes, and is repeating the same mistake (IMO) than what GFX did. I imagined we would have agreed on a small, minimal framework first, and then iteratively add specific conditions, snapshotting each conditions individually, perhaps with multiple options or token-weighted votes on values. It would have taken several weeks, and it seems this merge proposal has to be rushed for some reason, but I would have been fine with a slower, more open process. This would have set an awesome precedent in how DAOs can openly organize to reach consensus on such topics.

That being said, the content of the proposal has built an insanely large consensus already, and participation is through the roof (3x what we usually have, similar to the early votes on core mechanism changes post-genesis). It is evident a lot of work has been put into it, both in the document and in the relationship/consensus-building among large voters. The results are here, and I congratulate you guys for it. Thank you.

I personally don’t like the details of the deal, and I don’t think the document can significantly change anymore (because it has been rushed in in such a monolithic bloc), but in the grand scheme of things, the details of the merger don’t matter for where the protocol can be in several years. I’m excited for The Empire and when the vote comes on-chain, I’ll vote FOR, provided the “PCV instead of Equity” is resolved, that’s my only “blocker”.

Hopefully, we can have a more open process for amendments, and draft/vote each changes separately - we’ll see how things go in the next days.

1+1=3

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@Eswak

…this looks like a proposal designed by large TRIBE holders who want to ragequit…

Building a document behind closed doors…

I am an independent community member and stakeholder in Tribe as well as Rari (and likely not a large TRIBE holder by your definition: see jakekidd.eth), who acted entirely on my own volition, with some technical consultation from contributors. So you’ll forgive me for finding these implications a bit absurd. However, I do agree with your perspective, and really appreciate and personally relate to your level of concern.

My motivation:
I could not sit idly by and let such a trivial matter as compensation of proposal document authors jeopardize what I personally believe is one of the most powerful consolidations in DeFi history that stands to generate a lot of value for stakeholders. And if there is a critique of government process / mechanics to be made here - that things should not be allowed to be rushed in this way - then I would wholeheartedly agree with it! For it is this very same system that, from my perspective, produced the threat of jeopardizing the process in the first place. That is to say, if the proposal had been submitted as-is, a rushed vote or any “temperature check” would have been impaired by outside interest and thus not accurately reflect the desire of the DAO. By separating out the controversial debate regarding compensation, I believe that I effectively put the fate of this particular merger proposal into the hands of the community.

This vote:
As I’ve stated before, we’re voting here on a path forward. The language in the proposal as-is makes no suggestion that any details of this path forward are by any means binding or solidified. I think we have plenty of time to produce amendments and corrections and vote on them as necessary in the near future; especially since the technical details, including the smart contracts referenced here, still require additional work and verification from all parties involved.

I can personally guarantee that I would vote FOR a correction to that error you have pointed out in the merger document (and I thank you for pointing it out!). The more eyes and critique we can get on this thing, the better. My .02 on this: with such a large and powerful agreement at stake, I don’t think we were ever going to get a perfect document in one snapshot.

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This is very key and needs to be communicated clearly to both communities as well as people in the space at large. I have spoken to several individuals about this topic and they all were under the impression that this was to be a definitive vote on the GFX proposal as it stands (the one you shared). Clarity and organization are the most crucial ingredients to a successful merger. We should all be prioritizing those two as this process rolls out. Additionally, it would be great to outline things like an amendment process and a merger contract review period for legal. Just a clear outline and statement that these things will be happening will assuage a lot of the current stress and confusion

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[Related in discord as well]

This snapshot represents “broad consensus building” and NOT a definitive vote on how the merge will execute in detail. In particular things such as mechanism, exchange rate, and post-merge intentions are all an active work in progress and should continue to be discussed.

If the vote passes, I propose the current document be used in letter and spirit to be the default execution plan, but we encourage amendment proposals on any specific line item. The way that this will look is by snapshotting specific, redlined iterations of the document at https://bafybeia52gtifubkk7tn5zgszp5oyopjgt3bgowkhrgb4p7y34mcicncnu.ipfs.infura-ipfs.io/ after discussing in the forum as per usual. This can last as long as we need to, and I feel we should begin a discussion/snapshot for an amendment process, including timeboxing the amendment window, so that we can set clear expectations for the remainder of this important proposal.

In particular, there was a typo where protocol controlled value was used in place of protocol equity. It is pretty clear that this was a typo based on additional evidence such as GFX original proposal, contradicting other parts of the doc and lack of discussion of such an important change. Unless there are strong objections we can assume that protocol equity will be used for the final proposal on-chain without an amendment.

We must remember that decentralized governance and process is fundamentally about social consensus as much as technical consensus (recalling events like the ETC hard fork), so we are not married to our processes, they guide us to this social consensus. I do not think the proposal was handled flawlessly, but I am incredibly proud to see community members stepping up and fighting to make the process as effective as possible for our real goals

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Congratulations on securing overwhelming Yes.

I have a question on an important detail of the final agreement. IMHO - both parties should give warranties to each other against any hacking loss originated from their codes for at least three months.

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