Ok this sounds decent
This is the keyword, growth has a wide range, if the project can justify the use of fund as supporting growth, I would support them
Possibly they could make it a requirement for eligibility to future fortnightly rounds?
Or, if voluntary, then keep a similar public record of who opted-in and who chose not not disclose these reports?
Overall, considering the value of some of the Phase 0/1 token allocations, keeping adequate records & thus allowing the production of these statements is very little to ask.
Ideally, and again considering the value of these allocations, having a bookkeeper on staff/contract and a qualified accountant at least on retainer would allow for all the reporting the Foundation and Community needs.
Thanks for your time.
Ok got it. Thanks.
Great post. We also voted on all Phase 1 proposals and will share our reasoning with proposers and community in a bit. As an accountable delegate interested in the best outcome for Optimism, OP token holders and the overall ecosystem, we’d also like to get insights into actual spending of funds.
Sidenote: In the future, it will be important to see proposals earlier, enabling us to engage more before the voting process starts, so proposers can potentially adjust their proposals and incorporate more feedback.
First steps to better accountability:
A brief monthly update on spending and results.
A dashboard (Dune?) that enables us to track spending and on-chain KPIs.
Thank you for echoing my view.
Having a bookkeeper and accountant would require these proposals to request a much larger amount in their proposals.
I think the best would be having projects keep basic records and provide a quarterly update on the usage of the funds, either to delegators or the Optimism team to allow some accountability on the usage of funds and ensuring they are actually used!
Edit: Another thing I just thought of is projects depending on how they are setup and where they are based may be liable to pay tax on any funds they receive. This could be up to 50% depending on the country, meaning projects when asking say 1,000,000 OP may only be getting 500,000 OP as an example.
Your edit is spot on, there will most likely be income tax implications.
I agree with accountability but it completely depends on what the funds are spent on.
If it’s spent on development then the results of that development would be what to judge the team on.
If it’s spent on marketing then, the blogposts, social media campaign, swag will be what to judge the team on.
If it’s spent on on-chain incentivization of LPs etc., then this is quite easy to follow since each team would probably be using a smart contract for this so it would be transparent for all to see.
But yes I agree that each team should have a budget proposal, work outline etc. which would show what they plan to spend the funds on so that this later can be double checked.
I agree with this. I think in this regard we should work out a system that allows the protocols to be transparent with us and not require us to do so much work to verify that the funds have been spent correctly.
In an extreme case designate a work unit for this particular issue that tracks all the protocols and submits a weekly, monthly or quarterly report on how the protocols are spending the $OP tokens correctly.
I also believe that instead of sending the total amount of tokens in a single transaction, is to ask in the next phases that the protocols provide a payment plan by goals or dates and gradually release the funds. This taking into account that:
1. Tokens can be stolen from your treasury by a hack, carpet or exploit.
2. The protocol can misuse the funds and in that case cut off the supply of $OP tokens.
3. The protocol may be delayed with development or even abandoned (Applies to protocols that are under development).
4. Protocols where funds have to be approved by their DAO, may vote on a proposal that is not aligned with the Optimism Vision.
For point 4 in particular, I think that protocols that rely on the DAO for the use of tokens, we should establish that the proposal must first be approved by their DAO and then request the phases in Optimism.
These are just some ideas, I think it would be wise to take some time to think and come up with better systems for the next phases. Let’s keep in mind that the ecosystem is intended for the long term, there is no need to consult the Governance Fund quickly.
hey @OPUser, Thanks for actively working on Optimism governance and coming up with new ideas on how to make governance better. I agree with accountability for projects receiving funds in Phase 0 and Phase 1. There’s multiple ways we can do that, and I echo @lefterisjp in that the work done in each area (dev, marketing, incentives) is what should be tracked.
As a collective, we want projects to succeed and achieve the Optimism grant goals. That’s why I also suggest that each project that receives a grant can ask for a delegate to become their advisor, specifically for the grant they are asking. The delegate will be able help the project grow and achieves its goals that was stated in the grant proposal. The delegates will also offer advise on transparency and can act as link between the grantee and the voters. Ongoing communication is the key to the success of any project. How we setup delegates as advisors for projects is up for a discussion and I would love to see this coming for phase 0 and phase 1 projects.
This is an important topic and I think each team will need to find the best way show some accountability for their particular situation. Generally speaking, I think there should be some public company wallet(s) that shows the flow of tokens received from Optimism. That can be easily tracked with something like zapper.fi, though as mentioned, this doesn’t necessarily show what the tokens are being used for.
A quarterly or semi-annual report seems reasonable to me. The team can communicate how many tokens have been allocated and what they have to show for the particular areas of spending. Of course this can be checked against the public wallet(s) to verify it is all valid. This report can be a public release or limited to some group of Optimism representatives that can validate the claims.
It should be pretty easy to check and see if the goals are generally being achieved, even without a formal report. Ideally teams should be encouraged to have some sort of public dashboard to track whatever metrics are relevant to their project.
Speaking as a new project that isn’t very well known yet, we are ready to prove ourselves and we are trying to figure out the best way to unlock funds as we verifiably achieve our goals. I would personally like to have some representative or group of representatives from Optimism that have the ability to unlock those funds via a multi-sig. This way, once we have achieved the outlined goals, we could initiate a transaction, notify the representatives, and only if verified that transaction would be approved, sending those tokens into our team wallet. It would be ideal to have multiple representatives that can sign off on a transaction to avoid a situation that could infinitely lock up the tokens.
Another option for verifying outcomes might be to use something like kleros court (https://court.kleros.io/), especially if a team is applying for repeat funding. They would submit whatever evidence was sufficient to prove the previous amount was appropriately spent and outlined goals were achieved, then a decentralized jury would approve or reject the claims. To my knowledge, this isn’t on Optimism, though, so probably not a the best option at this point.
i support this and agree
I see where you’re coming from, and agree on a normative level, but I think this can easily stray into a bureaucracy where we’re devoting too much time and resource to shepherding the accountability process, and where projects are committing the minimum amount of resource possible to meet the requirements for more funding.
Take for instance the idea of quarterly reports. Some of the largest recipients (Aave, Lido, etc) are already doing similar, and can easily provide regular updates of what the project as a whole is doing, but without explaining how the RPG funding is being used or being held to account separately for their RPG funding. It feels like we would then require pretty detailed scrutiny of their abundance of reporting material to give feedback on what our community need from them… and how could we criticise them when they’re already providing so much? It’s in the project’s interests to just keep slowly giving us nuggets of information we request, and otherwise keep pumping out the same reports they’re providing for every chain, to keep costs down. And then is the idea that every delegate must keep track of this feedback and scrutiny, and bare it all in mind for the next proposal? That’s a lot of extra work on all sides.
On the flip side, imagine asking for quarterly reports from the small project providing a valuable service on Optimism only that’s difficult to monetise other than for RPG funding. Setting a prescriptive reporting standard may mean that they’re draining a decent chunk of their funding just on the cost of reporting. Or accepting that reporting could scale with the organisation, the little project may really only be able to say “here are our current financials and stats, all of our funding comes from RPG funding”. If that’s the case, then would we just accept a dashboard page on their site that shows the current state of their operations and finances? And if so, what’s to stop bigger projects taking the same approach? It feels like we may get so bogged down in figuring out the correct approach to accountability that we lose sight of the bigger picture - the little project doesn’t need much and is doing important things, so we don’t really need much accountability from it.
The synthesis that I’m reaching is that the larger and more complicated our approach to accountability becomes, the more it’s likely to damage the effectiveness of our RPG funding program. Some accountability may be of benefit, but we should aim for this to be flexible and accommodating to the needs of the recipient. We should also aim to make it manageable and easily digestible for our delegates, to keep the funding process light and accessible. Perhaps I’d suggest to start with that projects need to give feedback on their use of funds already received before they can receive more funds… that at least provides an incentive to give good feedback.
I would go as far as saying that no OP should be given until measurable KPIs are in place for us to track against. We shouldn’t be handing out money then scrambling to see if it was a good idea or not afterward. That’s a position of weakness
No one gets funding until we agree on a mechanism that proves whether you’re earning it or not. How else can we learn and iterate without good measurable results?
This will cause fewer people to apply as there’s more work involved, but it will also filter out the kind of people not willing to set up and commit to real world KPIs. I think the number of “super stars who only do great work without supervision or formal commitment” is relatively slim.
Don’t be afraid to make people work for their free money. Don’t be afraid to make demands in return (IF they help us iterate and better use future funds)
I love this very much! Transparency to me is so important and one of the primary reasons I am so enthusiastic about DeFi.
I am just seeing this post now; after I posted the initial draft for Saddle Finance - but actuallly had similar thoughts as you @OPUser which is why I linked to the Gnosis Safe Wallet Address that Saddle will be using on Optimism so anyone viewing the proposal and simply click and immediately see the address on-chain. I think all submissions should really have this be a requirement as part of the template.
In addition - the address was one I created with my public wallet/ENS: westonnelson.eth to further increase confidence in this regard.
If you copy/paste the address into the web app of Gnosis Safe at (it works on mobile, but the Desktop web app is what you want to use) you can actually easily see the address, confirm that it is in fact a 4/7 Multisig, and in settings, who the addresses that are the owners on the Safe with signing capability are! This is something I think hopefully should be helpful and perhaps a best practice for teams to be considered.
So as an example; even not as an owner, you can still view and verify this information about the Safe, which is excellent. In Saddle’s case it looks like this:
**And this can be accessed by you (or anyone) by heading to the URL:
As far as on-going tracking… I think as someone mentioned, this could quickly become overwhelming to the point where it would just feel like too much for anyone… so I did have an idea though here:
To actually create a small database of sorts (all the addresses that Optimism/Delegates have sent $OP to etc.) And then add them into Forta and subscribe to alerts about activity (which you can customize) so you can be kept up to date essentially real-time with the wallet activity. It’s one of the tools I use myself and so firsthand highly recommend it.
Really like the thinking here @OPUser - not an easy problem, but certainly very important for more effective allocation of grant funds. My comments are coming from the project/protocol perspective (GYSR).
For content creation, R&D, etc, agree that the deliverable is probably the most important and objective thing to show. In theory, any sizing for budget costs should happen during proposal, so granular receipts on which developer/designer/contributor happened to work those hours are likely less important.
For incentives, it’s easy to show a funding or airdrop transaction. No issue there. (In fact, for any projects that launch incentives on GYSR, we can help provided standardized reports on funding and distribution transactions.)
And agreed with this suggestion. We should be including a plan for tracking/reporting up front in the initial proposal.
Thank you for your insights , Devin.
Agree with this ser
yep! A little objective accountability goes a long way. we can scale the amount of red tape to the size of the ask imo.