The Social Infrastructure of Off-Chain Governance

Transcript

all right y'all what's up what's up hey you know what it is it's on the internet um i'm toby this is laura and uh if you don't know what other internet is that's okay we'll explain it um we're an applied research organization and um we we pursue our own self-initiated research and then we consult with organizations and like apply that research through narratives primitives governance work so you might have heard of headless brands or squad wealth that stuff originated from our self-initiated research and um we're going to talk to you about this new

initiative that we have going on which is about uh off chain governance and social infrastructure um we started this project a few months ago and uh yeah we're going to tell you about it now so um let's begin by taking a look at the evolution of thinking around governance in the history of blockchain so beginning with the bitcoin and its clone ethereum and most other layer ones focus specifically on automated consensus mechanisms that maintain the validity and security of the ledger by means of defaulting to the longest chain so

um they did not incorporate human decision making in the blockchain itself and this philosophy became known as governance minimization so since then the space has evolved with the smart contracts defy and house and we've also seen new funding models deliver significant treasuries the additional stakeholders and so because of these trends the topic of governance itself has become more relevant with the rise of governance tokens there has been a significant emphasis on voting whether on chain or off chain

as the primary focus on governance and particularly with dao's we've seen the introduction of off-chain social tooling there is now an emerging stock primarily composed of a discourse forum discord and snapshot of chain voting but we believe that voting isn't everything so this is an overview of our option governance research and our core thesis is that the less formalized processes that occur in these social environments where communities meet and discuss deserve as much attention as formal voting systems

the conversational infrastructure the structures interactions and organizes discussions is crucial to create the conditions for ideas to circulate and develop in official proposals eventually triggering an unchained vote and also the informal exchanges that occur through these channels and interfaces are instrumental in attracting and identifying key stakeholders and contributors that otherwise will not be taken into account in the more formal governance mechanisms for instance for not having enough tokens to meaningfully

participate in voting so how are we actually doing this research um well we start with just deep lurking doing ethnographic lurking in discords forums and identifying the key community members and how they're contributing um we do a series of stakeholder interviews with the core community members and and core team and try to foreground the the kind of hidden dynamics that aren't part of the the formalized processes uh that lead up to a vote uh and the first two uh projects that we've looked at are uniswap and pool together we published

our uniswap report uh maybe a month and a half ago and we're writing up our report on pool together now so we're gonna tell you some of our findings from those two projects um unit swap and pull together are very very different communities uh even they're both in deep eye they launched um not that far apart from one another um but they're very different in size unit swap has 275 000 token holders and pool together has 8 000 token holders so about 3 and roughly different quite different numbers of discord members as well but they both did a retroactive airdrop they both use the discord forum snapshot

stack they both talk about doing progressive decentralization this is the process that they identify themselves as doing and um while uniswap has had eight governance proposals um only about half of which have passed pooled together has had 23 governance proposals almost all of which have passed and some of those are actually rolled up p-tips which is their equivalent of the eip process so going into the what makes the uniswap community unique um the uniswap community is inspired particularly by ethereum's approach in terms of the simplicity of the

protocol it's similar to mining or staking you have lps contributing capital to pools and they earn a governance token based on that and so theoretically you should be able to just have that be similar to base layer governance and unit swap and their core team have kind of adopted that as their methodology for dealing with their community so they're super hands-off and don't give the community direction um and have have largely left developers and and discord community members and governance forum members to their own devices to figure out what's valuable to build however

this is complicated with the addition of the treasury because the treasury is an explicitly community governed thing so you have two approaches this governance minimization approach and the actual need to manage the treasury and in practice that means that there hasn't been enough social scaffolding to get that treasury capital deployed so here's here are a few examples of that for one while there's the full forum there's not a lot of governance activity happening in the discord um there's a governance channel but uh they're because uh of the token distribution the people who actually have the power to push through proposals don't need to

get the support of other users so they're not very active in in the discord um promoting promoting ideas a second factor is the discord has kind of been allowed to become a support oriented place when the airdrop happened there was a massive need for support and a bunch of community members were hired on uh those community members were already contributing which is what you think you would want but because they were specifically helping around support their form of community management is providing support helping with spam bots answering technical questions so there's no governance activity or governance specific focused community management happening

and then lastly there's just like a lack of guidance or leadership in terms of what proposals should actually be putting put forth to the governance process um so those those are some of the the the outcomes of like taking this um kind of hands-off approach to community development where there's an explicit need to deploy uh the treasury and have a community vote on that pull together however is very different and um we'll tell you about that next so pull together takes a very different approach to community from uni swap so to begin with the core team has used discord as their primary means of

communication since the very start with a diminished use of private channels and increasingly working in public this has led to an interesting blurring of the lines between a core team and community members with both often answering questions and actively participating in governance discussions um the pull together discord is also a more lively and dynamic place than only swaps because moderators and community members are actively encouraged to take initiatives with regard to the structure of the discord for instance start a new conversation or create a new channel

organizing voice calls and other more generally like taking initiative in the organization or contributors so one example of this community-led approach is the swim team which was a group formed with the explicit goal to onboard the prospective contributors and coordinate community activities and this later turned into the pool grants program which is another entirely community led grants program and the community also initiated the use of colapland tips and coordinators

to remunerate the core contributors in the discord additionally the decision flow from discord to forum to official proposal is strongly enforced and the communication and conversations are thoroughly documented throughout the discord and also easily accessible so um these design choices have led to very different outcomes uh there is a general feeling of wholesomeness and empowerment and positivity in the discord and in the community with lots of community members that we interviewed

typically joining the discord out of curiosity and ultimately staying for the vibes the community also feels empowered to make proposals they usually pass without any controversy but occasionally some community proposals have diverged from the core team's roadmap one example of this was the discussions around the pt 8 which proposed the creation of an nft price pool but which would require a lot of technical build out and while the proposal passed uh the initiative ultimately failed to gain

traction because he lacked the social support of the core team then at the level of compensation and performance pull together is facing questions that are becoming increasingly important to address in the space there is the lack of processes for those to value heterogeneous contributions this has important consequences for the community for instance impacting the capacity to retain core contributors that for instance need to leave the uh being really active in order to accept other jobs

as well as other cases in which contributors were perceived to be over billing for the work they did them so here tools such as coordinate are definitely a step forward but they are still heavily reliant on an informal reputation economy that rewards the community members that have already gained influence in the discord or whose contributions are the most visible so what are some key learnings and takeaways from this particularly at the beginning of at the early stages of a decentralized community transparency is not as important as

discoverability and accessibility of information these obviously also depends on the size of the community for instance in large communities that are still information such as uni swap it is not possible to have key stakeholders conversations transparent to everyone and here for decentralization to succeed the channels and opportunities to facilitate participation and also facilitate the discovery of documenting knowledge and decisions must be created promoted and actively maintained secondly autonomous is not the same as leaderless

an autonomous community cannot be created without a strong leadership and direction at the moment of distributed ownership to stakeholders a project must ask itself what kind of community does he want to have what should the community orbit around and why these are key questions and different options require different forms of leadership advocacy and community development thirdly there is no one-size-fits-all approach to community governance key variables are the funding model the size of the community the market cap what for instance works for uni-swap may

not necessarily work for pull together and vice versa and lastly within a process of progressive decentralization core teams need to have a clear vision for their communities also to be able to set expectations and clearly communicate the strategies to their key stakeholders great um so when we started this project our view was like let's study community management or what's being called community management because that's really a form of off-chain governance it's like the part of governance that affects the community but it's not covered by voting but our findings are definitely leading

us to ask many many more interesting questions such as what is the right model of valuing voluntary participation in a protocol what even is the purpose of the community that is generated by tokens like why are they there and what how should they participate um what what kind of communities are crypto communities in general and we have seen that they share some similarities with open source communities in in terms of they face the same challenges of attracting onboarding and managing growing numbers of contributors they also share properties of fan communities uh because they rely on on participants self-directed activities to to organize and consume information

and also they're similar to brand communities in which there's a central party that kind of relies on the participatory actions of of community members to provide support peer-to-peer um support and maintenance um [Music] i think crypto protocols share all of these traits um but we still don't know exactly what these communities are so to take a step back and talk about like what's next for this research um we have studied two protocols we're doing our second report now and we're hoping to study two more by um and by summer next year these have already produced a lot of learnings so keep an eye out for our pull together report

which will be coming out um in a few in a few weeks i think overall one one takeaway for all of you is that um we see a lot of a lot of projects using the same tool kits and language to talk about what they're doing it's progressive decentralization it's the same smart contracts and um when that same stack that same language and like ideological heritage is adopted some of the conditions that make your specific protocol and culture different are swept under the radar so it's important to have different vocabulary to talk about these these options if pool together is super hands-on with the community and inclusive of participation and uniswap's model for participation is

very hands-off and mediated through the grants program are they both progressive decentralization i'm not i'm not sure i think we we just need to get away from the language of autonomy and decentralization for these communities and talk about what they are which is groups of people organizing to do things with very different qualities and that will get us closer to the types of conversations that are productive um so this is this is what we've been working on um if you want to talk about this and like get more in-depth learnings like please find us we'll be hovering around here and in lisbon for like the next few days and you can you can follow laura and i and other internet here

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