Episode 172: December 16th, 2021

--- tags: G&R --- # Episode 172: December 16th, 2021 ## Agenda - [00:00](https://youtu.be/qEcUDkCNQB8?t=2): Introduction - [01:36](https://youtu.be/qEcUDkCNQB8?t=97): Votes and Polls - [05:58](https://youtu.be/qEcUDkCNQB8?t=358): MIPs Update - [11:38](https://youtu.be/qEcUDkCNQB8?t=698): Forum at a Glance - [16:48](https://youtu.be/qEcUDkCNQB8?t=1008): Discussion - Newcomers, Anons, and Sock Puppets - [40:10](https://youtu.be/qEcUDkCNQB8?t=2410): Discussion - Core Unit Proposals & Dispute Methods ## Video <https://youtu.be/qEcUDkCNQB8?t=2> ## Introduction ### Agenda and Preamble #### Payton Rose [00:00](https://youtu.be/qEcUDkCNQB8) - Hello to everyone. Welcome to episode #172 of Governance & Risk CU at MakerDAO. It is our last planned Governance & Risk call for 2021. My name is Payton, and I am one of the governance facilitators. I am very happy to be moderating this call. I am joined by many awesome Maker folks: those who work in the community, those interested in it, and everyone in between. Thank you all for coming out. Thank you; if you are watching this later on the record. I remind our participants that we are recording this call. Please try not to speak over one another. With that said, we do encourage participating. We want to get your questions and comments. Therefore if there is a pause in the conversation, feel free to hop on the mic. If you are not comfortable asking your question yourself for whatever reason, you can drop it in the chat. I am happy to do so for you. - We have a bit of an agenda to get through today. I will be guiding us through. As always, we will start with our governance Roundup until we move on to our community discussions. We will have an open discussion portion if there is some time left. If you have anything not related to what we have been talking about, you can save it to the end. If anyone mentions anything in chat that might be a good topic to close out on, I will bring it back up then. Without further ado, we will get back to what is happening in the world of governance and our votes in particular. ## General Updates ### Votes #### Payton Rose [01:36](https://youtu.be/qEcUDkCNQB8?t=97) *Executive:* - Last Week’s executive - PASSED & EXECUTED - Changes to wstETH-A Debt Ceiling Instant Access Module and Liquidation Parameters. - Changes to MATIC-A Debt Ceiling Instant Access Module. - Previously approved MKR Vesting Streams will be replaced with MKR sourced from the Protocol Treasury (Pause Proxy) instead of minting new MKR. - No Executive Proposal Anticipated until January 7th at the earliest - Recognized Delegates should keep a batphone handy however *Polls:* 3 Weekly Polls: - [Recognised Delegate Compensation Trial Performance Modifier - PASSED](https://vote.makerdao.com/polling/QmbKaHAv) - [DAI Direct Deposit Module (D3M) Net Rates Spread](https://vote.makerdao.com/polling/QmSgCHbt) - 44,843.58 MKR YES - 32,916.98 MKR NO - [DAI Direct Deposit Module (D3M) Debt Ceiling Targeting](https://vote.makerdao.com/polling/QmNi4qtG) - 57,501.47 MKR for 30% Real DAI Supply - 20,210.03 MKR for 20% Real DAI Supply - 49.06 MKR Neither - 2 Active Greenlight Polls - Vote Ends Monday, December 20th - [aUST (Anchor TerraUSD)](https://vote.makerdao.com/polling/QmPBRpCW?network=mainnet#poll-detail) - [G-UNIv3-DAIUSDP (Gelato UniswapV3 DAI-USDP LP Token)](https://vote.makerdao.com/polling/QmVTiToU?network=mainnet#poll-detail) ### MIPs #### Pablo [Weekly MIPs Update #66](https://forum.makerdao.com/t/weekly-mips-update-66/12190) ![](https://i.imgur.com/YSW9G3C.png) ![](https://i.imgur.com/vsPkE8u.png) - As per [*MIP51c4: Calendar Exceptions*](https://mips.makerdao.com/mips/details/MIP51#MIP51c4), there will be no Monthly Governance Cycle in December, i.e., no Formal Submission Window and no Ratification Polls. ![](https://i.imgur.com/AX3t8n1.png) ![](https://i.imgur.com/zPwd3f5.png) - I did get a request bubble for our dates going into RFC. With the new month and the break coming off. I just dropped the link to your forum. I do not know if you want to remind people when they need to get their edits in before we break for the rest of the month. - Pablo: Yes. For the upcoming Governance Cycle, the formal submission window will open on January 3rd and will remain open until Wednesday the fifth. The last day for modifications for the proposals that can make it into that cycle is December 29th. I do not know if that is exactly the question or not. Or are we talking about the upcoming February's governance cycle? - Payton: That was my question. Why don't we let people know if they are looking to get a proposal in by February when they would need to post that as well? - David: I wanted to mention that the votes and important dates calendar also has all this information. It has a final date for freezing, a final date for posting, pretty much all the info that Pablo makes available on that thread that Payton put in the chat. - Pablo: As for February, yes, the latest submission date for proposals in RFC should be January 12th. Again, the link that Payton shared on the chat is very useful. It has all the important MIP-related dates for 2022. I suggest you guys check it. If you still have any doubts after checking it, please reach out to me, and I will try to make it clear for you. ### Forum at a Glance #### Artem Gordon Post: [Forum at a Glance: December 9 - 16, 2021](https://forum.makerdao.com/t/forum-at-a-glance-december-9-16-2021/12240) Video: [Forum at a Glance: December 9 - 16, 2021](https://www.youtube.com/watch?v=FA-gpI6SnwA) ## Team-led Discussions ### Newcomers, Anons, and Sock Puppets #### How it’s currently handled [16:48](https://youtu.be/qEcUDkCNQB8?t=1008) ![](https://i.imgur.com/FOhmXIS.png) - This is a conversation about newcomers and anons and sock puppets. This is coming up somewhat due to recent activity that we have seen on the forums. Both with newer accounts, proposing on behalf of other CUs, participating in signal requests, etc. This discussion is about how the Maker community handles engagement from questionable sources? Do authors of proposals matter? How do we differentiate community malice or trolling from controversial but legitimate proposals that are perhaps posted by people who want to preserve their privacy? Also, how do we differentiate Sockpuppet accounts from newcomers who are potentially real stakeholders who just do not participate very actively? ![](https://i.imgur.com/dej5ju2.png) - I prepared a few prompts. The first one talks about how we have historically handled it and basically how it is currently being handled. The forum has been designed to allow newcomers to engage freely. Discourse at the forum platform that we use has a trust-level functionality. We do not rely on it too much. But we use it for a couple of different sections in the forum, for example, media inquiries. You have to be a trust level three or higher to post the media inquiries. In order to post a thread, I believe you have to be in a specific group, being in the Media Group, which requires a level of verification from our team. But for the most part, the forum does not have limits to newcomers. Usually, newcomers are pretty free to post whatever they want. And the reason for that is that we recognize that not all stakeholders have long-standing active forum accounts. There is precedent for newcomers to come in the forum and post very detailed or serious concerns. How do we currently handle it? - I know that GovAlpha makes a note of it whenever there is suspicious activity on signal polls, for example. One concern that was raised was how signal polls are not civil resistant. Anybody can create a million forum accounts if they want. They can cultivate them and make them seem legitimate over time, as we have seen on other platforms and other cases. But ultimately, signal requests are the first step of the governance consensus process here at Maker. But nothing happens until a Governance poll. And then, eventually, an executive vote happens. MKR holders still have an ultimate say on votes and decisions. However, we do want to have a higher integrity signal process. At the moment, all that we do, all that GovAlpha does is make a note of it when there is suspicious activity on signals. Though, by my understanding, that has not happened very much. And Payton can confirm or deny that and bring me into reality here. [20:44](https://youtu.be/qEcUDkCNQB8?t=1244) - Payton Rose: Yes, it is one of the checks we run before putting up a signal request. Before we put up a signal request to the polling stage rather, is just checking the votes and seeing if it is close. If so, are potential suspicious votes causing the margin of error? And if so, we post to the community. We can extend the poll, ask for more participation, call out potentially questionable behavior. But generally speaking, there is not a ton of participation in signal requests. It is usually between 20 and 40 votes, and most of them are known entities. Your assessment is accurate that it is very rare, but you know, it rises to the level of needing to alert the community to it. [21:35](https://youtu.be/qEcUDkCNQB8?t=1295) - David Utrobin: From the start, I believe the Maker community, its forum admins, and moderators have always valued freedom of speech and your ability to have freedom on this communications channel. I know we have always treated censorship or over moderation delicately. We do not want to censor if we do not need to or over moderate if we do not need to. We want to rely on the natural mechanisms in place in the community for weeding out weird behavior and weird edge cases like this. Does it matter who brings up proposals, for example? If it is a low-effort proposal, it naturally gets treated that way. However, if it is a high-quality or well-reasoned proposal, even if a total sockpuppet account posts it, I assume that people treat the proposal for what it is in it rather than who posts it. I am curious what people's thoughts are on that? Or in general on this topic? There is a lack of strong opinions because it has been somewhat non-issue. Its head has been showing in a few small cases, for example, on the case Oracles Core Unit budget just now. As well as what is another case? Nick, do you have any thoughts that you want to share about this whole topic? [23:50](https://youtu.be/qEcUDkCNQB8?t=1430) - Niklas Kunkel: As you said, David, It has not been that big of an issue. And I do not want to make it about the Oracle proposal because I think that is very specific. It goes much broader than that. It is not just who makes proposals; It i s also the signal request; it is who gets to vote in the signal requests. We have seen instances of other communities come and raid us. Where they all just make a bunch of accounts that day. And then they try and sway the community sentiment to be super bullish on whatever their collateral type is. We saw the chainlink organism trying to convince the community that chainlink Oracle's were the way to go for MakerDAO. We have dealt with them on an ad hoc basis. It was a very clear-cut situation. It was not very controversial or anything when we heavily moderated them. Many of these situations will not be as clear-cut. David, for example, you mentioned the quality of a proposal, and the quality of proposals is a very subjective type of thing. You could have a high-quality proposal coming from someone that has no reputation to post something. I do not know if the answer is that a fresh account ca not post a proposal because you could have a super high-quality proposal just coming from someone who has never posted before, like a lurker, right? There is some balance that we need to strike here. The important thing is that we just define these things ahead of time. When we do this kind of moderation in the future, then it is not as if we are just making up the rules as we go. There is a predefined set of guidelines that the communities come up with that we can then point to, and it does not seem like there is some internal committee that is calling the shots; that is the worst of both worlds. We definitely would not want that. - Payton Rose: There is a lot of good chat on the side here. I will encourage people to raise their hands if they do not want to hop on the mic. But one conversation, in particular, I wanted to highlight from GovAlpha's perspective, is this conversation of not being sure if someone is a sockpuppet. That is one danger we see in forcing us to decide what accounts are legitimate or not. [29:24](https://youtu.be/qEcUDkCNQB8?t=1764) - David Utrobin: One reason why I was bringing up this question of "do we just rely on the proposals themselves and not care about who's submitting them?" That is a very specific part of the conversation. There is also the other part of the general influence that Nick brought up just by general participation and random discussion threads, etc. But for proposals specifically, I asked it in that way because we operate in a community where we respect pseudo-anonymity, anonymity, full identity exposed people; we accept people from all walks of privacy. I see in the chat one thing that Seth is saying. In the real world, you have a right to face your accuser. But it is made a little bit muddy in our world because we are accepting of people who choose to cloak their identities or, you know, have an internet identity. I am curious; I do not see a reasonable way that we could require - I do not even think we should - people's identities, that is why I am trying to see what the culture is around, not caring whom the accuser is just caring about what it is that they are accusing you about. - Kirk Hutchison: An important thing to emphasize is when there is some kind of anonymous, unknown actor, or you just want to be consistent at all times, emphasizing the strength of the arguments on an objective basis from publicly known facts and things that they say that are unsubstantiated, or cannot be corroborated, just have to be thrown out. The big complaint or concern here is that people with conflicts of interest will use anonymous accounts to mask their conflicts of interest. At some point, you just have to fall back to the objective claims. People who do not seem to be making objective claims will simply have to be ignored. - David Utrobin: That is where the action of the community and voters has been. It has been like, "this vote is annoying. I have to think about it". But, whatever the objective claim is, it is vaporware. I am going to ignore it like that. I have seen that sort of sentiment. #### Is a proposal ever considered illegitimate? ![Prompt 2](https://i.imgur.com/1BXy0mG.png) [32:35](https://youtu.be/qEcUDkCNQB8?t=1954) - David Utrobin: The second prompt that I have for this conversation is whether or not a proposal is ever considered illegitimate. Assuming it fulfills all the requirements of the specific proposal or sub-proposal type. Does the author of the proposal matter? How much energy should be given to lower quality or spam or unsubstantiated proposals? We talked a bit about all these things. So it is pretty cool. What other cases a proposal would be considered illegitimate? In the next topic, there is a cool connection. I will leave that for then. I want to be mindful of time. Payton, if we are halfway through the hour, and we need to move on to the second discussion topic, just let us know. - Payton Rose: We will give it a few more moments. I was prepared for the arguments to mostly be on the other side, and so most of my notes are supporting the more anonymous because I figured we do have a clear bias as people being comfortable here and talking on the call, for the most part, as well as identifying CU people. But one risk that we have not talked about and is worth considering is the ability to spam proposals. The ability to sabotage, essentially, through this leniency. If you are a competitor, or whoever does not like Maker or DeFi, or whatever your particular grief is, it could become very easy to spin up an account and make proposals for the sole purpose of forcing the community to take time to respond to them. - David Utrobin: Seth said it well in the chat: punish with the process. [34:28](https://youtu.be/qEcUDkCNQB8?t=2068) - Christopher Mooney: It is like any spam problem. We do not need to borrow trouble yet. But if that does end up happening, we can always gate things on MKR or something like that. The forums could validate that you hold some amount of MKR. We should not be pre-optimized for that, by the way. We should do whatever we can to maintain an anonymous culture. Maybe that should be the general rule. Anytime we run into a major problem with the anonymous culture, we should seek the least inhibiting way to flourish that culture. But without outright banning anons. [35:27](https://youtu.be/qEcUDkCNQB8?t=2127) - Brian McMichael: We already have embraced anons. We have got Longforwisdom, who do not think anyone here knows who he is. But he has built a reputation. And there is this bicameral type of governance that we have here with Maker plutocratic weight. And then, a social layer allows people without wealth to participate in governance meaningfully. But, in general, you would want those people to have a social stake. We care about a stake in Ethereum. And at a social level, we should care about social stake. Ideas do not exist in a vacuum. Especially anything regarding financial considerations. There are conflicts of interest; there are competing CUs and competing protocols. We want to understand what those are to have the full perspective around a proposal. And again, anything involving finance, you need to follow the money. If you cannot follow the money. I do not know how we can enforce that. Maybe something for people to keep in mind when looking at a proposal; how much social credit does this person have? I do not want social credit scores. But there is a very subjective approach that we can take to viewing these things. As I said, there is nothing that says that Maker cannot be a community of anons. I would like to be an anon myself, but I have spent many years and, many of us have spent many years using our own identities and building that reputational stake in the DAO. When a new account gets spun up, and it just comes in to create a post that seems to be stirring the pot, I guess, for me, I am going to take the side of the entity that has the greatest social stake, that has the reputation of the community, then just taking the ideas as they are presented. Because we do not know what those ideas are being backed up with. I will get off my soapbox. [37:46](https://youtu.be/qEcUDkCNQB8?t=2266) - David Utrobin: Very good points. Those points also reinforce a culture where any external or semi external stakeholders work to establish some sort of social reputation. I am still a bit concerned about big stakeholders who do not participate and will eventually come in and share something. And maybe the community will not take it seriously. - Brian McMichael: You can build that up. If dragonfly comes in and decides they want to make a post after many years of not posting, they will identify themselves as someone with dragonfly, and we will take the credit that they have built elsewhere and apply that. I think Ashley came in and posted something after never having posted, but we know who she is, right? She has got a history with Maker and with other protocols. If your goal is to create a new account to stir the pot and not provide any other context, I am personally not going to give it that much credit. - Katie: I feel like it is a cop-out in a way. You can tell people making a controversial proposal and using an anon account just because they do not want to use their real identity. At the same time, you just have to look at the proposal's content and not the person creating it. However, in my opinion, and probably many other people's, it is just the cop-out. It is the easy way to do something controversial and not associate it with your reputation. I wanted to talk about; I am curious about everyone's thoughts about people making proposals outside of a CU. It is an interesting thing to me because, in some ways, that makes sense, but then in some ways, I do not know if it does. It seems like an interesting topic of discussion. Related to budget, I do not know if it makes sense. I am relating to offboarding. I get that. Someone within the CU cannot make that proposal. What do people in CUs think about that? ### Core Unit Proposals & Dispute Methods #### Offboarding vs Correction, and Dispute Methods #### Submitting proposals on behalf of another CU ![](https://i.imgur.com/STJRfFO.png) [40:10](https://youtu.be/qEcUDkCNQB8?t=2410) - David Utrobin: Katie, that is so awesome that you brought that up because it perfectly segues into the next discussion topic. What you brought up is prompt number two. What do we think about submitting proposals on behalf of another CU? Just to center the conversation, it is about CU proposals and dispute methods. When somebody does propose something on behalf of another CU, it is a stronger signal of a dispute. This is my attempt to map out what are other ways to dispute before you go nuclear. These are the available dispute methods that the public has or disagrees with CUs. There is complaining; you can complain directly to the facilitator. That is probably the best first thing that you can do. Talk to the CU with whom you have a problem. Then there is complaining to surrounding actors. Delegates, for example, say, "Hey, why isn't this core unit doing its thing?". Then there is the third sort of escalation of complaining, which is publicly on the forum. You go, and you make a case. It is not a proposal; it is just a discussion. Ask, why is this CU not performing? But then, beyond that, I believe Greg proposed, and Maker governance passed MIP 52, which is a dispute resolution process that we have never used, but it is available as a tool for governance and people. But if you disagree with a CU or a mandated actor's actions, you could submit a dispute to Maker voters using that process. Finally, the third most aggressive way to dispute with a CU is through the proposal process itself. First of all, you can campaign against active proposals. We have seen that most with budgets, for example. People push back on budgets. Or they will directly say no, or they will propose an alternative budget. Besides campaigning for active proposals, there is proposing offboarding, a facilitator, or proposing something directly. That is the question that you brought up, Katie. Is it reasonable for other people to propose MIP, 39, 40, and 41 sub-proposals on behalf of another CU? And that is kind of where the whole conversation is at—bringing it back to your question. I am going to let people respond. [43:23](https://youtu.be/qEcUDkCNQB8?t=2603) - Chris: This, in a way, happens to Protocol Engineering fairly frequently. Even before Protocol Engineering, when part of us was in the Foundation. The DAO drives initiatives by throwing Maker weight around. We tended to pay attention to requests on behalf of our CU from other actors when MKR voted for those requests to go through. I would find it pretty frustrating if we had to battle complaints and perceptions in the forums constantly. Sometimes that is probably better than allowing someone else to convince the MKR holders of something incorrect. The DAO pretty heavily decides our roadmap. I think Protocol Engineering suggests stuff too. That is probably true for a lot of CUs, is that CUs serve at the pleasure of MKR holders. In a way, MKR holders drive us a little bit. But without taking that sort of MKR weight into account. Where do we draw the limit where we do not get randomized by anons on things like signal requests, and we can still execute? I think it has been paying attention to where MKR holders vote for our group. [45:21](https://youtu.be/qEcUDkCNQB8?t=2721) - Nicklas Kunkel: I would like to have a little more of a defined process. I do not like talking about incidents. For example, the recent incidents with collateral offboarding or the recent incidents with my budget getting forked. I want to have guidelines for the future because those are more important than whatever, singularity, or whatever we want to call it. On the one hand, we have this philosophical argument. Mooney mentioned this one thing of how we already base our direction, within the CUs, on the sentiment that we see in the community. And how we see the voting going on on different proposals. Then you get to more minute things, for example, with facilitator offboarding. If you do not give the community the power to offboard someone who does not want to be offboarded, you are severely handicapping them. In a sense, the community does need to have the power to just submit an offboarding proposal for a CU facilitator. Is that the case for every aspect of a CU? In the case of budget, it is not the case, and here is why. You start a CU, and you have a mandate. You then promise that you are going to do certain things on your roadmap, say, within the next year, within this budget cycle, whatever period your budget cycle is, and then you need to execute on that mandate. You need to execute on that roadmap. Only you, as the facilitator, are going to have the insight into what kind of resources you need to execute on that. It seems to me that the natural way that this should go is that the facilitator submits the proposal. The community says no, that is too much; we do not like that. The facilitator has to go back and retool their budget. It comes with, let me reduce my mandate, because, with less money, I cannot fulfill all those obligations anymore. And there is this back and forth until you do manage to pass a budget, and then you are good. That seems like a much more natural way to do things than dealing with external budgets coming in for the facilitators. It seems like a weird way to do it; here is your pile of money, now figure out what to do with it. It is similar to how they all get allocated a certain amount of cash in the US departments. If they have something left over at the end of the year since they do not want their budgets to be lowered, they all go and buy ridiculous crap and just try to spend all the money by the end of the year, so next year, they can get a similar budget. That is a little bit tangential here. The flow of facilitators submitting budgets, and then the community giving feedback on those budgets and potentially voting them down if they disagree is a much more natural way to do this than for facilitators having to battle alternative budgeting proposals. It is also a bit weird, for example, in my case, where the resulting budgeting proposals were just splitting mine up. That is a little bit of a unique case. What if multiple people had submitted different budgets for the Oracle CU? Let us say David had submitted one and Katie had submitted one, and Mooney had submitted one for the Oracle CU. Now you have a bunch of Oracle CU budgets going either into the same governance cycle or different governance cycles. There is a breakdown to process. We do not have to do it the way I am thinking, but I think we need to redefine the CU MIP to put more guardrails in place. So we do not end up with these breakdowns of process. [51:07](https://youtu.be/qEcUDkCNQB8?t=3067) - Justin Case: Is there any good reason for people outside of the CU to make a budget proposal? Because no one outside the CU has any real way of knowing what is supposed to go into it. There is a mechanism to handle a disagreement with the budget that says CUs have to reapply their budget. Whenever the CU has to reapply, people will get a chance to speak out against it. If we go in and micromanage the budgets throughout the year or the budget period, it will make a mess out of everything. And the CUs are going to end up focused on the unit of their budgets, and if anything to do might be conceived as controversial, we will lose all progress. Once a budget proposal is accepted, we will have to live with that for a while until the next time it comes up, and then we have a chance to do something about it. As it was mentioned, we do have the offboarding process if someone is doing something extremely controversial. Maybe in some cases, we need an offboarding for an entire CU, if we for some reason, deem that the necessity of this CU has run its course. Those things are natural to do in conjunction with a budget proposal or the renewal of a budget proposal because things do not happen that quickly that we cannot wait one quarter or six months, or how long it takes for the next budget proposal to come up again. And that makes for a more sensible approach to the subject matter, in my opinion, at least. [53:15](https://youtu.be/qEcUDkCNQB8?t=3195) - Payton Rose: I could provide some backdrop there as to your question in terms of if it ever does make sense. From a political science perspective, the power of a person is pretty important checks and balances. We delegate a lot of authority to CUs. We allow them to block proposals, to insert them directly to on-chain voting, basically a lot of permissions that could be abused if taken in the worst-case scenario. One advantage to allowing others to post this is that if a CU is particularly powerful or influential, they are doing something that the community maybe has not liked, maybe suggested they change, and they do not want to change it. You have very little recourse if the leverage is all on the CU facilitator side. That does not mean there are not other ways we can solve that. We are providing opposite perspectives as to one reason why we might want to keep that in place. [54:40](https://youtu.be/qEcUDkCNQB8?t=3280) - David Utrobin: Like I wrote in the chat, but permissionless proposals support the general decentralization of governance at Maker. The key problem that Nick and so many others are pointing at is that it might not make sense with specific proposals. For example, for offboarding, Blimpa mentioned there is a component that sets a precedent for actual offboarding. In the budget MIP, you do not have that; you do not have to "use this component to alter somebody else's budget". There are way more sensible ways of approaching that specific kind of dispute. I do not think that, in general, we should be restricted proposals, but in very specific cases, it might make sense, especially with the budget proposals. I do not know how it would look like. If that happens, I guess, GovAlpha would be able to deem it illegitimate. Or what would it look like if it were restricted? Would it just be ignored? Would there need to be an explicit sort of statement for each time that happens? [55:56](https://youtu.be/qEcUDkCNQB8?t=3356) - Payton Rose: We would need to pass something through our MIP structure that says, you know, only X is allowed, or Y is not allowed. Then GovAlpha can point to that and say, the community passed this, which deemed this proposal illegitimate. We would not sign up for anything that involves discretion. We would want it to be very clear about anything that could call our neutrality into question. If we have to make judgment calls, where it is, in a situation where it is likely for bias to come in there, that is not a situation we would be supportive of. However, the community can pass whatever they want. And we will do our best job to enforce what they pass, whether that is something I would be mindful of when bringing the proposal forward. - David Utrobin: That makes sense. There is also this thing popping up in my head of hard rules versus soft rules. Soft rules are things that the entire active community sort of understands that there are no hard rules to codify or enforce; it is sort of naturally enforced. For example, somebody posts a budget proposal on behalf of another CU the next time. We had this conversation, everybody knows; you just ignore it. You do not have to give it much thought. At what point do we want to put in a harder rule where it is regardless of what anybody thinks? At some point in the past, we have made a rule, okay, it never makes sense. Is that the benchmark? When it never makes sense that you make a hard rule? Or should it be just kept as a soft rule? So we could save on the governance overhead of it all? - Pablo: I was reading Nicolas's comment in the chat. Are there any cases where the community might want to set the budget to zero instead of offboarding a CU? MIP39-C3 is the process for removing CUs. And the condition for such a sub-proposal to be submitted is that the CU that needs to be offboarded should not have any active budget or active facilitators. It is kind of a prerequisite to abort a CU to remove the budget and the facilitator in a prior instance. Maybe that process should be revised. [58:49](https://youtu.be/qEcUDkCNQB8?t=3529) - Wouter: I just want to quickly build on what Prose was saying and what I was putting in the chat. I think it is about the community permitting the CU to do certain things. To call yourself an official facilitator is permission allowed by the community to that person and, as such, can be taken away. Putting the payment stream in place is permission granted by the community and, as such, can be taken away. To assign any official roles, to give any privileges, for example, as a manner of actors having access to certain information or joining calls that are off-limits for others, these are permissions that can be taken away. Anything that falls outside of that does not make a lot of sense because it is like the ownership of the CU. You cannot force someone to do something in a certain way simply by voting a MIP about it. I cannot submit a MIP that says that Chris Mooney has to wear a Christmas hat every week, or I would have already done it because the community has no permission to that individual. If we want to formalize it, it is probably good to be formal about these kinds of permissions that we are granting. Then you have a very good framework to say, well, if you grant them, you can take them away. Then there is the edge case that I brought up, simply consented. You can just about propose anything if the party it involves consents or supports it. That is the other case. You can take permissions away that you have previously given; you can propose anything if it is with consent; anything that falls outside of that is not useful. [1:01:10](https://youtu.be/qEcUDkCNQB8?t=3670) - Payton Rose: The only example I could think of the might counteract that, and again, it might be balanced out by the rest of the argument is initiative-specific funding. I will use my CU as an example, which does not apply to anyone else. For instance, the community knows I spent a lot of time working on our source cred. What if we get to the point where the community feels weird? We are spending too much money on sources. But because this is my pet project, I do not want to get rid of it. This is hypothetical. But let us say that was the mindset I was taking on. I am not going to listen to the community. GovAlpha is important; you guys are not going to vote us down. I am leaving the source cred funding in place. Because it is a part of our budget, it is much harder to address that through other governance methods. That is potentially one scenario where the lack of consent for that particular program might make sense. [1:02:15](https://youtu.be/qEcUDkCNQB8?t=3735) - Wouter: I would disagree because you propose the full package. It is not like a menu, and we can pick and choose. It is like, "this is what we are proposing; it includes the full package, and we are willing to do all the other things that are in the proposal if it also includes the substantial budget for sourcecred, or whatever." Any other input from the community is based on your consent. You can say, "I want to do all these other things, and then I also want to fund sourcecred, and I would like to go for the highest option, but I would consent to a lower budget ."But the only thing that can be taken away is just the permission and the package deal. It fits within this frame of thinking. [1:03:09](https://youtu.be/qEcUDkCNQB8?t=3789) - David Utrobin: Then also, other dispute methods can happen before you go nuclear. If you disagree with the funding of one program that is in a big-budget package, you could post about it; you could put up a signal request about it, you can try to influence the core unit itself to see your reasoning for why they think this program does not make sense. If there is a total disagreement, you could bring it to MKR voters through MIP 52. I think that with the tools that exist, there is never a case where a direct disruptive budget proposal should be proposed from a third party without consent. That is kind of the view that I am gravitate gravitating towards. Ultimately, using your example Payton, if a program was approved in your budget in your mandate, but three months into the six months, people are realizing, "Oh, this is not working", there should be a way for people to communicate that. [1:04:33](https://youtu.be/qEcUDkCNQB8?t=3873) - Juan: I am wondering what we are trying to fix. Because it is not like we have a very large amount of, you can call it spam if you want. But I can see a lot of use cases, and maybe I am too naive, and they will never show up. But for example, when Mark was proposing the Moonshot fund and all that. What if someone had said, "Hey, this is your new forked budget? There is no Moonshot fund anymore". Then everyone would have said, "now it makes sense ."Maybe the history would have been different. I think Prose's example was maybe good too. Perhaps someone thinks you are spending too much on that process, or whatever. So we are splitting that, and then it is up to you to accept it or not, and maybe we should fix governance or the process for that. But I can see where ideas should flow more naturally; again, we should not be judging the author unless it becomes problematic. There are different conversations. What if a Maker holder that could be a shadow delegate wants to propose something? What are they supposed to do? Start posting and build a reputation? Or are they supposed to dox themselves? Should we start KYC'ing every MKR holder? I think that the answer is no. Probably everyone in this call agrees with me. ![](https://i.imgur.com/cPDzIbP.png) [1:06:20](https://youtu.be/qEcUDkCNQB8?t=3974) - David Utrobin: People are bringing up motive matters. To some extent, yes, who cares about the author? It is about the proposal. But on the other side, what about the motive? What about the conflicts of interest? That is the nexus point of where this issue is. [1:06:36](https://youtu.be/qEcUDkCNQB8?t=3997) - Katie: I do not think it is about the motive. I think it is the operational overhead for the CUs, at least from my perspective. Outsiders making proposals about CUs about their internal operations, whether budget or anything, I do not know what could be another example. But it seems like that just causes a lot of operational overhead for the CUs. I also understand the argument of "everyone's voting on these proposals so everyone should be allowed to create them" But then the other side of that is, it is just operationally inefficient. - Juan: It will be inefficient. In every DAO, I think we have facilitators to deal with this kind of stuff exactly for this. Probably the least controversial CU is GovAlpha right now. If someone posted something against GovAlpha or defunded them, I do not think anyone would take that seriously. I do not know if we should start. It sounds like we are against criticism. And it is very dangerous to portray this image to the broader community. We do not want for people to argue, "oh, the CUs within Maker, they do not accept criticism, now you need to do A, B, and C to criticize them ." I think that the auld be to post solid work and make sure that we are doing our best. If the spam becomes too problematic, then maybe we should solve that differently. Maybe every proposal should have some staked MKR or, three facilitators, proposing that is potentially also dangerous. I do not want to create groupthink within Maker and make us into this group of people that just became too strong, and we cannot improve because no one can take us or say anything against us. - David Utrobin: My thinking is that taking criticism is a core fundamental thing that all CUs should preserve. You should be able to take criticism. The thing that I am trying to fix, going back to your original question Juan, is not necessarily to fix it, but more how do we go about criticizing CUs in a less operationally disruptive way? You want to preserve the ability for people to call people out and stuff. [1:09:31](https://youtu.be/qEcUDkCNQB8?t=4167) - Justin Case: We should put as few restrictions on proposals as possible. There is something to be said about things that occur regularly. I do not think there is much value in discussing the same proposals over and over again; it can cause engagement fatigue. Every month, we discuss someone's budget because someone has posted a new budget proposal. At some point, people will give up on conversation and not be engaged anymore. Processes that are defined at regular intervals might be restricted to those predetermined intervals. Because they will be discussed, and we are not skipping the discussion. We are merely making sure we are not spending bandwidth on something that will be discussed anyway. [1:10:23](https://youtu.be/qEcUDkCNQB8?t=4223) - Payton Rose: Thank you, Justin. I think we might do another call from people outside of CUs. We have been talking a lot. And this is the issue where we are more biased. That is the reason I am calling for other voices as well. One thing that might be important to say is from a governance process, if you hear this discussion, you think that something should be changed, it would either probably need to be a new MIP or an amendment to the CU budget MIPS that would address what we are talking about. And as with any proposal, GovAlpga is here to provide feedback, help you with the governance process if that is something you want to undertake, and are unsure about how to go through it. Absent anything like that, we would just keep interpreting the rules as we have been, which is permissionless. As long as those proposals satisfy any other requirements that we have already put in place, they would be treated as legitimate and brought to a vote when formally submitted. [1:12:12](https://youtu.be/qEcUDkCNQB8?t=4332) - David Utrobin: I want to make a contextual note. However, this is not a huge problem in our community now. We see little blips of edge cases popping up. As MakerDAO grows, it is important to have these conversations with the wider community so that it is not just a handful of people thinking about this. That is the main motivation for bringing this up. We want reasonable and normal processes, and we want to do things the right way. We want to do them in a way that preserves the values of our community. [1:13:04](https://youtu.be/qEcUDkCNQB8?t=4383) - Payton Rose: The fun part is that the people proposing in effect shape our values through how they are accepted and engaged with. Thank you, everyone, for engaging with this. As mentioned, at least in the chat, I ca not remember if I have said it yet. This is our last call of 2021. I really appreciate all the attendance. This is probably one of our better-attended meetings, and it is great to have so much participation. - David Utrobin: Look out for the Maker annual governance review that our team will put out. I believe in the first week of January. And we will be back on January 6th for another Governance & Risk call. [Suggestion Box](https://app.suggestionox.com/r/GovCallQs) ## Common Abbreviated Terms `CR`: Collateralization Ratio `DC`: Debt Ceiling `ES`: Emergency Shutdown `SF`: Stability Fee `DSR`: Dai Savings Rate `MIP`: Maker Improvement Proposal `OSM`: Oracle Security Module `LR`: Liquidation Ratio `RWA`: Real-World Asset `RWF`: Real-World Finance `SC`: Smart Contracts `Liq`: Liquidations `CU`: Core Unit ## Credits - Artem Gordon produced this summary. - José produced this summary. - Kunfu-Po produced this summary. - Everyone who spoke and presented on the call, listed in the headers.