Announcing the Dai Foundation

Today, we are proud to announce the Dai Foundation, an independent legal entity for safeguarding the Maker community’s intellectual property (IP). This marks another milestone in the gradual decentralization of the Protocol.

Intellectual Property Rights

One of the key challenges on the roadmap for further decentralization of the Maker Protocol, is the management and protection of its associated trademarks and other intellectual property, such as open-source copyrights. Since these cannot be decentralized through technology, they need to be held by an independent legal entity that has the best interest of the community in mind.

IP management and protection was originally the responsibility of the Maker Foundation, but now the Dai Foundation has been created for this specific purpose. Earlier today, the Maker Foundation has transferred the ownership of Maker and Dai trademarks to the Dai Foundation. Assignment of the open-source copyrights for the Maker Protocol software components will follow in the next weeks and months.

Read the message from the Maker Foundation about the IP transfer here.

The Dai Foundation

The Dai Foundation cannot seek profits and is only mandated to serve its specific purpose. It was created in Denmark, which has a very strong legal framework for independent foundations and where they have been legally accepted for centuries.

The foundation operates solely on the basis of objective and rigid statutes that define its mandate. Its purpose is to safeguard what cannot be technologically decentralized in the Maker Protocol, i.e. certain intangible assets that underlie the protocol.

The Dai Foundation helps to ensure that these intangible assets are used for sustainable growth of the Maker Protocol, and for maximizing the public good thereof in line with a set of fundamental principles. As such, it is important for the Maker community that these assets can never be transferred to any single for-profit entity.

IP Protection

There could be situations that result in a misuse of the intellectual property, brand assets and goodwill that the community has accrued over the years. In such case, the Dai Foundation will use appropriate tools to ensure that the Maker Protocol remains aligned with its core principles.

These principles include:

  • The protocol must be available free of charge, as open source and without restrictions, on equal terms and for anyone.
  • There must be a high degree of access and distribution to the unbanked and financially underserved.
  • The governance of the protocol must take a sustainable approach, and no harmful centralization of the protocol must happen.
  • Development of the protocol must be in compliance with the legislation in force at any time.
  • The protocol must be operated using scientific governance that optimizes long term stability, assures diversification of the collateral portfolio, and benefit of Dai users.

In practice the intent is that the community can freely use Dai trademarks, but abuse by scammers is prohibited, and that malicious attackers of the Protocol are not allowed to mislead users of the Protocol.

Restrictions

Last but not least, it is important to note a few elements that do not fall within the mandate of the Dai Foundation:

  • It does not influence or press any personal agendas. The Foundation’s statutes define board of trustees’ responsibilities, and determine strict procedures for appointing new board members.

  • It is not involved in emergency shutdown procedures. However, the board of trustees aims to be prepared and plan for edge-cases where the Dai Foundation may need to offer support with answering related IP questions.

The Initial Board of Trustees

Initially, half of the Dai Foundation’s board comprises external and independent board members, whilst the other half of the board is made up of private individuals related to the Maker Foundation.

  • Søren Peter Nielsen, Chairman, Head of Product at Maker Foundation
  • Jacek Czarnecki, Deputy Chairman, Global Legal Counsel at Maker Foundation
  • Hans Henrik Hoffmeyer, Co-founder of Coinify
  • Michael Dunworth, Co-founder of Wyre
  • Payam Samarghandi, Attorney at Law at Horten Law Firm
  • Wouter Kampmann, Head of Engineering at Maker Foundation

As such, the Dai Foundation is initially set up to ensure that the independent board members have the necessary understanding of the Dai system and its mechanisms. Over time, the board members affiliated with the Maker Foundation will be replaced by independent board members.

What’s Next

What’s been the most urgent agenda item?

Quite literally, getting this announcement out to the community so that we can make sure that we’re actively discussing what we’re not taking into account.

To be upfront, we don’t even know what we don’t know yet. The more eyes, thoughts, and contributions are brought to this conversation moving forward, the more aligned our preparation becomes.

This community is aligned exceptionally well, and that is because it has grown organically over time with like-minded people. This fact is proven by its mode of governance.

Moving forward

We’re guessing that there are a million and one questions to be answered, and we want to find those answers together as fast as possible. Having an active discussion surrounding edge-cases, considerations, and all things in-between is going to ensure things are following what is important to MakerDAO, which is all of us in the community.

We would like to start the discussion by being actively present in this forum and going rapid-fire on everything or proposing updates/community feedbacks weekly or monthly as part of the governance process through the transition period until the necessary information and understanding are well documented and readily available to new community members.

Kind regards,

The Dai Foundation board

10 Likes

Is there incorporation paperwork on this entity that can be reviewed by the rest of the community?

Also technical questions.

Why was this not put up as a proposal for vote by the Maker community at large?
What is the responsibility of this Foundation to the Maker community?
Does the incorporation paperwork include the objective and rigid statutes?

5 Likes

From the blogpost: “The operating expenses of the Dai Foundation will initially be covered by a donation from the Maker Foundation.” Is this donation in DAI or MKR? If MKR, will the Dai foundation continue the tradition set by the other foundation of not voting?

2 Likes

Congratulation !!!

  • A foot closer for a better World!!

Happy New Year!!

1 Like

Hi MakerMan

The essence of the purpose of the foundation and its statutes are in its Trust Deed preamble which I include online here (I will respond to your other questions in another post):

Dai Foundation Trust Deed Preamble
This Foundation has been formed by the initiators of the open, decentralized and permissionless MakerDAO system with the virtual currency Dai.

The vision of the MakerDAO system is to create a decentralized, autonomous, open, accessible and price stable payment system and a financial infrastructure based on blockchain technology.

The Foundation must safeguard certain intangible assets that underlie the MakerDAO system, which should not be taken over by or transferred to a single for-profit entity, but rather be used for sustainable growth of the MakerDAO system and for maximizing the public good thereof in line with the fundamental principles that are expressed below.

The core MakerDAO system shall be made available free of charge as an open source and without restrictions, on equal terms and for anyone who wants to use the MakerDAO system, both citizens as well as companies and other organizations.

The MakerDAO system shall ensure a high degree of access and distribution to the unbanked and financially underserved, and the system shall consider negative externalities and ensure the sustainability of the activities and a positive environmental impact.

The MakerDAO system must be managed in such a way that the appropriate checks and balances are considered to ensure no harmful centralization of the protocol.

The development of the MakerDAO system must be in accordance with the legislation in force at any time.

The MakerDAO system should use scientific governance that optimizes long-term stability and protects Dai users. The MakerDAO system must further diversify the portfolio of assets used as collateral in the MakerDAO system’s CDP.

The MakerDAO system should be sustainable and ensure that the existence of the MKR token is for the benefit of Dai users.

The Foundation is set up as an independent and non-profit-oriented entity to assume ownership of certain intangible assets in the MakerDAO system, to ensure that these assets are used solely in line with the principles laid down herein, and to maintain, develop and
communicate the MakerDAO system and its capabilities as well as virtual currencies
and blockchain technology more generally.

re. your technical questions:

Why was this not put up as a proposal for vote by the Maker community at large?

One of the practical goals on the road to gradual decentralization is that the Maker Protocol can continue to thrive after the Maker Foundation is dissolved. While there still is a lot for the community to discuss and decide around collateral onboarding, DAO teams, monetary policy, etc., the decision to create a safe place for the Maker trademarks hopefully is non-controversial. We will now engage with the community on how to handle controversial decisions around rights to use the trademarks, and we are certainly ready to put the resulting rules or guidelines up for a vote.

What is the responsibility of this Foundation to the Maker community?

The Dai Foundation engages with and takes advice from the Maker community. It must always act according to the principles in the Trust Deed.

Does the incorporation paperwork include the objective and rigid statutes?

Yes, please see the preamble in my other answer.

2 Likes

The initial donation is in fiat currency. Should the Dai Foundation receive donations in MKR I believe it would stick to the tradition set by other foundations of not voting (the board haven’t discussed this yet though)

Thanks! - Happy New Year to you all as well :slight_smile:

1 Like

Good Afternoon @sorenpeter

If you need help for something, just let me know, i am not too far away.

Again, Thumbs up about your foundation.

I almost forgot, Happy New Year again

Congrats Maker! Quick question on the choice of the initial trustees, what were the considerations to install these professionals into the initial trustees, what would their powers be?

Hi.

Is there a list of Dai IPs somewhere?

HI @ginworkflow,

Why do you need IPs,

But here is not the good place to ask this question.

Please refer to the forum section :white_check_mark:

Forum Index : https://forum.makerdao.com/t/648

Feedback : https://forum.makerdao.com/c/site-feedback

@Sirlupinwatson1 I think Gin is referring to a list of the IPs that will be transferred to the Dai Foundation. I would also be interested to get any answer to this.

@sorenpeter A few questions from me:

The Dai Foundation is a very generic name for something with a specific purpose (holding Maker and Dai IP.) Are there plans for this purpose to evolve in the future?

One issue I’ve noticed is that there is no good ‘owner’ for certain domain registrations. Open source tools created by the community are available in multiple places on the internet, but the domains tend to be owned by specific community members or the Maker Foundation. Could the Dai Foundation also take ownership and responsibility of domains of this nature (with the owners permission?)

Will the financials of the Dai Foundation be open to the MKR community as a whole?

What is the long-term plan for funding the Dai Foundation?

How will new board members be appointed to the Dai Foundation? Will this require a MKR Token Vote (should it?)

2 Likes

Thanks for your question!

As you could see from @sorenpeter 's previous posts, the half of the board is made up of private individuals related to the Maker Foundation. The plan is to ensure a smooth transition of some important functions thus far performed by the Maker Foundation to the Dai Foundation. Over time, these board members will be replaced by independent ones.

The other half of the Dai Foundation’s board comprises external and independent board members. Hans Henrik Hoffmeyer, Michael Dunworth and Payam Samarghandi are long-time supporters of MakerDAO, as well as trusted and accomplished individuals who give the highest possible warranty of integrity and loyalty to Dai Foundation’s principles as enshrined in the Trust Deed preamble quoted above.

A Danish Foundation is a very rigid structure in which the individuals are supposed to follow the pre-coded rules and cannot overstep their mandate. We are still climbing up the decentralization ladder, but with the Dai Foundation in place the personal details are losing their importance, replaced by the robust decentralized infrastructure of the Protocol, in its both technological and legal aspects.

2 Likes

Hello @LongForWisdom - Thank you for the questions.

@Sirlupinwatson1 I think Gin is referring to a list of the IPs that will be transferred to the Dai Foundation. I would also be interested to get any answer to this.

As the Dai Foundation gets set up with its own web site a list of the IPs that are in the possession of the Dai Foundation will be published. On a high level the IP consists of primarily trademarks for Maker and Dai, Open Source Software for the Maker Protocol and a bit further down the road the makerdao.com website and social media handles for MakerDAO.

@sorenpeter A few questions from me:
The Dai Foundation is a very generic name for something with a specific purpose (holding Maker and Dai IP.) Are there plans for this purpose to evolve in the future?

The Dai Foundation activities can in theory evolve in the future as long as it is aligned with the purpose to protect the MakerDAO intangible assets, and therefore not engaging in activities that might raise questions about the objectivity of the board in pursuing this primary purpose.

Regarding the general name: remember that the Dai Foundation will be the only “official” entity that won’t be decentralized in the future (because by definition it can’t be decentralized.) So yes, on the one hand we want the purpose to be as limited and specific as possible, because what can be decentralized should be decentralized. But on the other hand, this will be the only official MakerDAO / Dai entity in the space and its name seems therefore fitting.

One issue I’ve noticed is that there is no good ‘owner’ for certain domain registrations. Open source tools created by the community are available in multiple places on the internet, but the domains tend to be owned by specific community members or the Maker Foundation. Could the Dai Foundation also take ownership and responsibility of domains of this nature (with the owners permission?)

This has not been discussed by the board yet. I think the Board is positive towards this if we can find a way to scope what falls within the DeFi and Maker Protocol ecosystem and what does not. Moving forward I think this is an area where we shall solicit input from the community. That said, the Dai Foundation will likely acquire those domains which basically represent the trademarks safeguarded by this entity.

Will the financials of the Dai Foundation be open to the MKR community as a whole?

Yes, the financial statements for the foundation will be made public.

What is the long-term plan for funding the Dai Foundation?

The foundation will seek donations from donors that want to support open financial systems.

How will new board members be appointed to the Dai Foundation? Will this require a MKR Token Vote (should it?)

The board of trustees will elect its own members for a three-year period. Re-election may take place.

4 Likes

That is great news if you decide to go in this direction.

People here are over-qualified for this so it would not be a problem i think to get a hand on domain-name and such.

There is great people on here, just a small ( ).

Il7v2AY2223new

Thank you for the prompt and detailed answers!

1 Like

Question for @sorenpeter

Let’s say a company servicing Maker users had a patent granted and it became such that the majority of users (weighted by DAI amount i.e. not raw number of users) using Maker would be using it with this companies patented technology. Also let’s say that through the ownership of this IP said company would have control and power over the DAI credit system. In order to avoid centralization around this community members legal monopoly would the DAI Foundation enter discussions with this company on taking control of its IP so as to avoid centralization? (i.e. decentralize a community member’s IP)

1 Like

Hi Akiva

I apologize but your hypothetical scenario is not clear enough for me to provide a straightforward answer. Please do note that it is the MKR holders that have control over the DAI credit system aka the Maker Protocol.

2 Likes

Congratz for the new announcing, happy new year guys :smiley:

1 Like