Signaling Request: Should Maker make a Treasury to manage revenue?

The goal of this post is to gauge the community’s feelings towards implementing a treasury- like construct accessible through governance.

Two additional considerations are: do we want to siphon some revenue from vault fees to fund the treasury. And would we want the foundation’s participation, either through partially funding the treasury, or some hybrid control multisig situation? Those discussion would come next if the community wanted to pursue a treasury.

The impetus for the poll comes from this thread: https://forum.makerdao.com/t/makerdao-needs-a-treasury-to-provide-compensation-to-its-workers-post-foundation-focus-on-workers-for-now/1091/11

While the contents of the post focus on worker management and some questions around that, a fundamental part of employing people is budget. Currently the DAO has no “treasury” with available funds to employ someone. The foundation employs or funds the vast majority of people/groups that work on the protocol or related tools. The DAO does however, have revenue from vault fees which goes towards DSR + MKR burn.

Again In short, does the community agree with pursuing the creation of a “treasury” used by the DAO?

  • Yes
  • No
  • Other (explain below)
  • Abstain

0 voters

Update: So far the consensus in the comments seems to agree with the idea of a treasury. Mkr holders already voted on paying oracle fees from the stability fee according to @LongForWisdom (I dont remember in which vote but i’ll trust him on that), so handling those would be a good place for a treasury to start.

In general there is still much debate remaining on how the treasury would be funded/structured and if we want someone to run it. Also the technical smart contract questions remain. Ill leave this thread open until someone tell me to close it

Yes with the caveat that it doesn’t happen until the system is more self-reliant/sustainable. We’re still in a low margin growth stage and don’t think we could afford it at this present time.

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Fair. It could created without siphoning any revenue initially. The foundation could also donate some funds so MakerDao can pilot paying a worker (Governance facilitator would make sense to me).

I think we should do this at a small scale first, probably for a one-off transaction before we try to make something continuous or large

Hi all,

I don’t think to dig in the pocket of current investor is the good way to do it.

While doing this on a transparence way since its collaboration with the hole system.

Bringing this more like a sharing revenu or sharing some share.

The one who are here already are on a basic voluntary.

They don’t ask any money if i have the permission to say this.

But giving the opportunity to some to expand the company or the foundation, is more something that came on my mind.

Preferably Maker should be such a small and automated organization that no treasury should be necessary.

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@Planet_X Hi,

Exactly what i was thinking.

This will scare some investor, or not.

I am not enough deep into this to talk more about it. Just a simple view from the outside i can bring.

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In that view mkr shouldn’t exist either. I actually agree though, simplist/fewest possible incentives and mechanisms is preferable. Just doesn’t line up with reality so far. No one has been able to do it no matter how much they say maker is fully automate-able.

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Can you imagine automating risk team(s)?

Can you imagine automating risk team(s)?

Not for now i guess.

Maybe in a near-by futur.

First with respect Planet_X and Sirlupinwatson1 the idea that everyone from the community is going to ‘donate’ their time to enrich large MKR holders for free is simply is unsustainable in the long run.

There are key responsibility authority positions that will need to be paid for “in the long run” that we can’t expect the Maker Foundation to do. In fact I am not even sure they would want to do it, or even if they can do it. Do you want more MKR to be minted or this to be paid from incoming revenues? Frankly I would rather this come out from DAI upfront than minting and selling MKR for DAI after the fact.

Hence Mitote is correct at a minimum we need to establish at least the idea we want a treasury - the details of implementation conditions - to be discussed. How much, who and how it is used - to be determined.

In the loosest sense a person MAY not be required to be treasurer - that we can debate - but all monies should go into and out of a treasury account. Given Maker is paid in DAI I think we need to start accumulating DAI just to even start to test whether we as the community can agree to proposals being presented for acceptance by ‘contractors’ and then paying out when they are complete. IF all financial transactions are on-chain we probably still will want someone at some point who is responsible for giving a ‘treasury report’ periodically this is generally true with respect to Maker Income and Outlays and general business analysis as well as putting up polls on MIPs to accept as proposals to offer, and proposals to be paid. We might not need a full time paid position for this, but we are going to want every position to be at least 2-3 people deep for redundancy, illness, death etc… To train, and have these people available no matter what positions we decide we will still need a treasury.

People are suggesting we shouldn’t take money from the SF income now. I counter with we better start thinking about it now because we are going to need someone to adjust the smart contracts to start putting money away, just to be able to pay for stuff in the future the way we want and why not start now. The only thing DAI is doing is burning MKR - we surely can slow that down 5-10% (at $100M outstanding this is ~.5-1M DAI worth/yr without hurting MKR burn too much to start paying for things via a treasury model which is funded by SF revenue.) This could also act as a kind of emergency fund in case something unexpected comes up (like an IP/Trademark defense lawsuit)

If the community wants to try to run like a charitable organization - feel free but I can tell you right now from experience since MKR holders stand to benefit from any ‘donations’ of time and effort to Maker that over time people will see MKR holders benefiting from their work without pay and eventually they will just ‘go away’. Eventually unless replenished the MKR foundation funds will run out. I have seen this over and over and over again with organizations that depended entirely on ‘donated’ time/work. Honestly if this is going to be the metric then it is our large MKR holders that are going to have to step up and compensate people. In the end this kind of approach will lead to further centralization (which imo is not part of the key 5 goals as I see them written).

So lets try to be real about this and simply move forward. I see absolutely no reason why 5 or 10% of the incoming SF couldn’t be set aside towards the treasury when to start that I’d like to start sooner, but sensitive to Aaron on this (maybe we could do 1-2% of fees Aaron?). As to hiring the first person even part time there should be more than enough from 5-10% and maybe even 1-2% (50-100K DAI/yr) of the SF fees to pay for that and probably some other stuff. We could try to use the treasury to offload some of the stuff the Maker Foundation is currently paying for and get a more transparent view of actual operational costs. We also should be prepared to pay for legal defense of IP/trademarks, etc.

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That make sense. I agree with you.

Like you said it’s better to do it now , because time goes fast and this community grow even faster.

You have a very good opinion there and i support you into this direction.

This is the key part. Many people are currently spending their time on this project (myself included.) Personally speaking while I don’t think i would disappear were I no longer paid, I wouldn’t be able to justify spending the amount of time on this project that I do currently. I need to eat.

We will need to have a treasury, and it will need to be funded from the stability fee income (there is no other income stream generated by the system.) While we could mint and sell MKR to fund the treasury, this is functionally the same as using the stability fee income because otherwise that income stream burns MKR. My hope is that the treasury functionality will be on-chain and that we will not require a ‘Treasurer’ position.

Given that I’ve been thinking about this for a while, let me lay out what I see as the most probable future in terms of this subject.

  1. MKR Token Holders have already agreed that oracle fees should be paid out of the stability fee income generated by the system.
  2. Because of this prior agreement, it is likely that this will be the prototype case.
  3. Because oracles operate at least partially on-chain, I suspect that the functionality for paying other on-chain entities using the system debt buffer will be developed. This has the advantage that money will be taken from stability fees when available, and if not available the system will print MKR using the existing mechanisms.
  4. Because the oracle fees are an on-going cost, I suspect that whatever mechanism that is developed will be capable of paying a re-occurring ‘salary’ to on-chain entities. This will almost certainly require a vote by MKR Token Holders.
  5. With that proof of concept, we will have everything we technically need to pay arbitrary addresses for services supporting the Dai Credit System.
  6. At that stage I predict that either the Foundation or the community will start pushing for a ‘transfer’ of personnel from the Foundation to the Dai Credit System, probably starting with the Governance Facilitator (assuming MKR Token Holders ratify this.)
  7. At that stage ‘balancing the books’ becomes a thing that MKR Token Holders need to consider, I am doubtful that this will require a paid position as all data will be available on-chain.
  8. I actually think it is more likely that we will need a Human Resources type role before we require a treasurer role.
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Yes, this is right @LongForWisdom

I must be too much enthusiasms about contribution here and forgot about the real life aspect.

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First with respect Planet_X and Sirlupinwatson1 the idea that everyone from the community is going to ‘donate’ their time to enrich large MKR holders for free is simply is unsustainable in the long run.

Yeah. Ahem. About that… I have had a change of mind. Maker governance is simply not going to work without incentives. There is going to be so much work that working for free is out of the question.

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I think this distinction is important and i agree with it. There is no need for a treasurer position in the foreseeable future.

On-chain would still required supervision, less of course but still.

After some rude test and deep evaluation it would be beneficial. But i think on the side that abusing could be a major factor.

@LongForWisdom

I agree. I am also spending my time here w/o compensation but I have donated my time to other projects that I see I might be able to help move along. Not being compensated effectively means I can come and go as needed for my family etc. Which is the best thing about on-line work (in most cases ability to just meet deadlines vs. having a formal 9-5 type job)

Sounds like most of us are agreed we need a treasury and it will require a vote. I think you are right that probably first things to pay for are the oracles. I think peoples thinking here is that there are other positions we will need to pay for first other than a treasurer since everything will be on-chain and auditable. Like I said lets just go at this one step at a time and just drive through it with decent thought and care.

Agree to make a treasury, come up with consensus on when/how (much) to fund it from fees and then once we have funds and a means to disburse them we can start to think about how the treasury should act, and what recurring fees to take on.

In the end pretty much agree with all the subsequent comments here and your well done list above.

I’m not sure much more needs to be discussed at the moment other than what level we want the funding to start, and how to implement the mechanics of funding the treasury from SF fees. Once this starts rolling perhaps we start another thread regarding how the treasury should operate, what recurring fees we should be paying what positions to on-board first, what level of compensation for what responsibilities.

I do see that the community needs to pull back and pay for the domain names associated with Maker to put these in the IP/Trademark/community ownership hopper so we should put that in the list above as well.

I think the next step after formally authorizing the treasury as well as access/payment mechanics is to get some kind of list from the Foundation of what they see as the first things to off load to the Dai Credit System for management/payment.

One thing that came to mind is all this is going to have to go through governance cadence (i.e. authorizing MIPs, payments for work, etc.) So your right someone to handle governance issues, cadence, managing details of that is probably a key first position.

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I make pizza for work now, so I eat. If maker could let me not eat pizza that would be swell. :crazy_face: :crazy_face: :money_mouth_face:

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