Season 8 Council and Board Mandate Guidance

Elected Representatives 💼
2

The Grants Council should not be asked to reserve a portion of their budget to evaluate grants related to the futarchy Mission.

I want to provide feedback based on our experience with the previous futarchy experiment.

In Season 7, the Grants Council was asked to rank a list of projects selected by the Foundation, based on which would produce the most TVL by the end of the season. These rankings were compared to the community (Butter) ranking. However, this setup provided no benefit to the Council or the grants process or its intent.

The experiment made the Council into a predictive, trader-like role without any information on how projects planned to use OP incentives. Evaluating incentive strategies and ecosystem alignment is core to our role. Guessing future market performance based on market data is not, we are not traders.

Further issues with the experiment include:

  • Misleading TVL attribution: Most of the “TVL win” cited by Butter on X came from a single outlier (Balancer & Beets), which actually lost TVL in ETH terms and was 6th on our ranking. The majority of the TVL movement was due to price action, not new bridged TVL from OP incentives.
  • Poor predictive accuracy: The futarchy market predicted ~$250M in TVL gain. Actual gain was ~$30M — an entire order of magnitude off.
  • Flawed comparison: TVL outcomes are not a good proxy for grant effectiveness. Some projects (like Beets) received low GC scores precisely because their OP usage was inefficient. Yet they still show up as a “win” in the futarchy framing.

If we want a serious comparison between futarchy and GC outcomes, the structure must change:

  1. Let users vote/bet on GC approval and compare results based on real metrics.
  2. Require futarchy participants to clearly explain how OP will be used.

Budget-wise, given that I must present a Season 8 Charter and budget before the Foundation releases any report on the Season 7 futarchy experiment, I believe this initiative should not be funded from the Grants Council budget. This is a Foundation-led experiment, unrelated to the core mandate of the Council, and should be covered by the Foundation’s own resources.

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