Optimism’s Token House is up and running! For the past six weeks, Token House delegates have been reviewing and voting on Governance Fund grant proposals from projects across the Optimism ecosystem.
In the first three voting cycles, the Token House approved 36 project grants and rejected 14 proposals. 19.3mm OP has been distributed to projects already. OP Summer is officially in full swing — keep your eyes peeled for news on incentive programs, community funding, and more.
For a summary of the first three voting cycles, see the Cycle #1, Cycle #2, or Cycle #3 roundup threads.
Voting Cycle 4 is begins today and ends on Wednesday, August 3 at 12p PST. See proposals current up for vote on Snapshot, or in the Cycle #4 roundup thread.
What We’re Learning
The Optimism Collective launched with a minimal governance framework and an intention to iterate. To understand what’s working and what’s not, we’ve been collecting feedback from proposal authors, delegates, and other members of our community. We’ve heard a few common themes:
There are too many proposals to review. In our current governance structure, every project proposal is put up for a vote by the entire Token House. The Governance Fund received dozens of proposals in the first two voting cycles alone. Ideally, each proposal gets feedback before voting begins; with so many individual votes, this is hard to make happen.
There’s no time between voting cycles. Voting cycles run every two weeks. Cycles begin on Thursday at 7p GMT and end 13 days later on Wednesday at 7p GMT. Our hypothesis was that proposal authors would leave their submissions in “draft” mode until they’d received feedback, then submit to a voting cycle when ready. Instead, we’re learning that authors submit to a voting cycle even if they’re received minimal feedback – there are no guidelines suggesting otherwise! This means many delegates both review and vote within the same two week period and don’t have time to get to the incoming “draft” proposals.
Some proposals don’t have enough background info. Delegates aren’t familiar with every project submitting a proposal. While some proposals come from well-known crypto projects, others come from smaller or more specific projects unknown to many delegates. In order to evaluate proposals well, delegates have expressed the need for better context-setting and background info, or more time for research.
Communication channels are challenging. Our governance process spans Discord, Discourse, and Snapshot. Community members have expressed confusion or frustration at having to track conversations across multiple platforms
Some parts of the governance process are underspecified. v0.1 governance process as defined in the Operating Manual lacks clear instructions on a few situations that have come up in the first two voting cycles: how to re-submit a proposal which previously passed, rules around conflicts of interest, and precise submission deadlines.
Lack of alignment on Governance Fund scope. Our governance documentation says the Governance Fund exists to encourage the “proactive growth of the Optimism ecosystem,” and there is a distinct allocation of OP for public goods funding. Nevertheless, there’s still plenty of room for interpretation of “proactive growth.” Should the GovFund be used to compensate development teams? Can closed-source projects apply for funding? Can some public goods be considered as promoting proactive growth despite the separate bucket? There’s been good discussion on these and similar questions in the Discord.
Gov Fund Guidelines
As Governance Fund grants are approved are distributed, our community has raised questions about individual projects’ use of the tokens they receive.
Teams who receive grants from the Governance Fund must be able to account for all transactions that touch any portion of their grant funds. And while this may be obvious, we expect no self-dealing. If any expenditure can be construed as self-dealing, we expect the team to be clear about this in advance and include why it’s not self-dealing. Withdrawals of the grant from the Optimism network should also be clearly stated and justified.
We’re grateful to our community for holding projects accountable to their proposals. Accountability will be a core focus of future governance process iterations.
Season 1 of Optimism Collective governance is coming to a close. What does this mean?
The Optimism Foundation is working with delegates and community members to shape a set of process upgrades that improve our governance based on the feedback above. We promised this would be an iterative experiment, and we mean it! The next iteration will be considered Season 2.
Here’s what to expect:
- Season 1 will end after Voting Cycle #4 closes (at 7p GMT on August 3).
- After Voting Cycle #4, the governance process will take a three-week Reflection Period with no active votes (Aug 4 — Sept 1)
- During the Reflection Period, the Optimism Foundation will publish (a) a proposed changelog for the v0.2 OPerating Manual, and (b) a set of governance proposals aimed at addressing the feedback we’ve received so far.
- While changes to the OPerating Manual don’t require a formal vote, we request that delegates and the broader community provide feedback during the Reflection Period to make this next season the best it can be.
- Any proposals that require more than a change to the Operating Manual will be put up for Token House vote (e.g. establishing a standalone committee with an up-front budget).
- Special Voting Cycle #5 will begin after the Reflection Period and will run for 13 days, from Aug 25 at 7p GMT until Sept 7 at 7p GMT. This voting cycle will include only the process improvements mentioned in (b) above.
- Season 2 will begin on September 8 with Voting Cycle #6. The governance process will follow the v0.2 Operating Manual and any new processes approved in Special Voting Cycle #5.
What this means for proposal authors:
- The current Voting Cycle #4 is the last set of proposals that will be reviewed until Voting Cycle #6 begins on September 8.
- Season 2 (beginning with Voting Cycle #6) will include new structure and process. Stay tuned for more information on the new governance flow.
Thank you to our community for their participation, feedback, grace, and humor. And, as always,