I would also just like to chime in to second the opinions put forward by @justmythoughts and @lastmjs that I think the NNS should rather aim to function at a protocol level, with only necessary exceptions.
It is a shame to see the “doesn’t stop anyone else from doing it” argument used again, as this is not really addressing the central concern which, imo, is that this allows the NNS to have a formal preference in the expenditure of ICP and, even if it is DAO-run, has a preferential place in the ecosystem, unavoidably leading to some kind of central power structure. This makes it very hard to describe the NNS as an agnostic system that does only what it is told (albeit quite intelligently).
In my view, one of the most revolutionary elements of the whole ecosystem is the NNS, not because it produces governance but because it merely enacts it. It is primarily administrative and, as a result, makes a beautiful connection between trustless, cryptographic systems and system-scale administration. With this change, there is definite creep into active management that I think taints the whole priniciple.
While this all may be true, what are the upsides / downsides in terms of actual consequences?
Downsides
Authorities shut it down due to regulatory / legal risk
Folks lose money if CF doesn’t perform
Distraction of time and resources for foundation if unsuccessful / is shut down
Upsides
Massive funding source. There’s about $2BN of maturity untouched that can be contributed to ICP projects. Some folks would prefer to invest in diversified fund rather than individual projects.
Recurring funding source for ICP projects. It is recurring as folks can assign future maturity to the fund. ICP value is ballpark $4BN (looking at total supply). At 10% inflation thats $400M. 5% of that is $20M annually.
The hype that the IC desperately needs. May attract developers from other ecosystems if they believe it is easier to get funded this way than the normal route.
If A bunch of projects get funded this way and then the CF gets shut down that may be a totally fine outcome …
Do you see the downsides as much graver than I’m painting ?
The Neuron owners should be able to choose between “Maturity Investing” or “Neuron Investing”.
I think CF is generally a good way to invest in projects, but investors shouldn’t be able to invest just with their maturity. ICP that you want to make available for CF should also be 100% investable.
How does this work? How do you receive the maturity and convert it to ICP? If donors add your principal as a hotkey to their neuron, then you can see the maturity, but you can’t disburse the ICP. Do they have to disperse the maturity by spawning a neuron, waiting 7 days, and then sending the ICP to the ICDevs account? In other words, is this a pretty labor intensive process for the donor?
Hi I’m struggling to understand why someone with a neuron with staked icp would ever join the community fund when they can just spawn icp and participate that way ?
What if neuron holders, whilst in the community fund, could allocate a portion of locked holdings, into that project, min1 icp capped at 5% of holdings. This could be a huge use-case for staking icp. Earn whilst waiting to invest
Surely some benefits have to be formed, or it’s a pointless feature… unless you’re a whale with 10k+ icp we’d only be investing scraps… Someone help a smooth-brain understand the CF
I think it comes down to the CF neuron owner not having to mint ICP in order to participate in the community fund. It is a transfer of maturity between a CF neuron and the NNS, not a transfer of ICP. That has tax advantages to neuron owners who hold a lot of maturity. About 70% or all maturity earned since genesis has not been disbursed, so the community fund provides a way for those investors to make their maturity useful without having the tax burden. It’s potentially a pretty big pool of funding that can bootstrap new projects on the IC.
Just wanted to give everyone an update on the ICP Maximalist Network neuron vote for the Community Fund proposal. All votes have been submitted and our neuron voted NO to the proposal. The tally of voting members was 3 yes and 9 no votes. Our vote cast 10.2% of total voting power in the NNS due to liquid democracy.
There are a variety of reasons why our voting members voted no, many of which have been posted on the forum or Twitter.
Our vote swung the overall tally to a result that now stands at 12.6% YES and 13.5% NO. ICDevs had previously voted NO. Cycledao voted NO at the same time ICPMN voted NO since they are following our neuron. DFINITY and ICA have not voted yet. The voting period has been extended by another 1 day 15 hours since our vote swung the vote so heavily.
Even though the ICP Maximalist Network has been around since just after genesis and we have a lot of very prominent members of the IC ecosystem that participate in our network, there are always people who don’t know us. In order to answer that question in light of our impact on this proposal, I am linking our public document that identifies our voting members and our neuron voting policies. Please don’t hesitate to join our Telegram chat group if you have any questions.
People can follow ICDevs on the manage neuron topic. Every time the maturity gets >1 ICP we spawn the maturity to a new neuron that ICDevs owns, then we dissolve it.
I haven’t looked at the underpinnings of this yet to see if we could use Maturity instead of a spawned neuron(Can you split your neuron into one that holds all the maturity and one that doesn’t? I’m not sure).
I wish it were otherwise, but I have severe doubts that any taxing authority will view the use of maturity in investment as anything other than converting it to income, so jumping through hoops seems a bit overkill.
Got it. I forgot they can follow your neuron for the Manage Neuron topic. I suppose most of your donors are genesis neurons, so they have to set that up using DFX or Quill. Have you provided instructions on how to set this up in the NNS dApp? Is it even possible with the NNS dApp redesign? This may be another reason it would be good for DFINITY to expose the Manage Neuron proposal topic in the NNS dApp.
They took it away after about two weeks after genesis because the interface was confusing and people were giving DFINITY and ICA control of their neurons. They could easily add it back now that the conversion is complete to svelt. I’m not sure if it is on the road map or not.
These were the instructions , but I haven’t updated them since the svelte upgrade:
using nns:
Follow Neuron 14231996777861930328 for the Manage Neuron Topic(instructions). This is a bit more complicated as it still requires using the web console. Using chrome:
Log into the NNS and navigate to the neuron you want to dedicate.
Right click and “Inspect”
Go to the Sources Tab and navigate to top/nns.ic0.app/ic_agent.js
Search for “this.follow = async” (about line 1793)
Add a breakpoint on the next line by clicking the line number. This line should say something like “await updateRequestHandler_1.submitUpdateRequest(……”
Leave the console open and go to the “Following” box.
Click Edit Followees.
Click A topic for which you have 0 followees. ie “Exchange Rate”
Expand the topic and click Add Followee
Put 14231996777861930328 in the Followee Address box and click “Follow Neuron”.
Your breakpoint should trigger.
Hold your mouse over the ‘request’ variable on the line. This should bring up an interface to edit the properties of the request.
Change the topic to 1.
Click the “play” button.
Confirm that your neuron now follows 14231996777861930328 for the Manage Neuron Topic.
…also…while this is not possible now, as soon as t-ecdsa gets turned on we could create a smart contract to manage something like this…I had a design fro spam that did something like this, but was limited because contracts can’t control neurons natively.
I am one of the voting members for the ICP Maximalist Network who voted YES to this proposal. It was a very difficult decision for me because I think this proposal primarily benefits whales with fat neurons and I am not one of them. However, when I think about what is in the long term best in interest of the IC, I think we need this community fund.
It concerns me that there is so much neuron maturity that is undisbursed. About 70% of all maturity that has been earned since genesis is still sitting in neurons and the total amount in ICP equivalents is growing significantly due to inactivity of the neuron owners to spawn or merge. There is no time lapse on liquid maturity. If it were all spawned suddenly it would flood the market with ICP. If it were merged all in one day then everyone’s voting rewards would go down significantly. Now with the new modulation function, there is incentive for people to watch the modulation parameter and spawn when they can get an extra 5% (like right now), which will suppress upward potential on ICP price (it can also suppress spawning when price is dropping). There is no cap on maturity and the eventual unknown disposition just makes me uncomfortable.
This community fund proposal gives those neuron owners a new option and ties up their maturity for some period of time as it works through each SNS token launch. Right or wrong, I suspect this new option has tax advantages and will be attractive to the whales that are able to participate. Their participation in the community fund will fund dApps on the internet computer. Hence, there are potentially significant growth opportunities.
I understand all the arguments against this proposal and I agree with them. It also pains me that this proposal seems like it will benefit whales more than it will benefit post genesis small investors. However, I think the greater good for the IC is to support this proposal and potentially unleash a significant amount of funding that can benefit the ecosystem while simultaneously locking up some of that massive maturity that nobody talks about.
I am a voting member of ICPMN neuron. I voted YES for proposal 74820.
The maturity which is layong dorment could be used very well to fund new projects. This will atrract devs and this maturity will be put to better use than being sent to exchanges to be sold.
Even if part of the maturity received by projects will hit exchanges, they will have already brought talent and attention to IC.
There can be many improvements made, but theorising about them is not the best way forward. Small iterations after feedback comes from usage is a healthier approach in my view.
That is why I voted YES, to have more projects, devs coming to build on IC as funding is available and done directly using the SNS which will also have the spotlight in all this.
Thank you for your feedback @Denis. And agreed that this is a complicated topic, as this is a quite new funding vehicle. Regarding your question: You are right that exposed maturity would be probably lost if the linked SNS project completely fails (in the end this requires a decision from the NNS on how to reward the CF neurons for blocking their maturity).
Thanks, @bjoernek . I will not go on about this further, because few in the community seem concerned about it. In any case, it makes no difference to me, I was against the modulation proposal anyway and have no personal stake in its outcome. But I do believe the way the SNS swap is structured undercuts the premise behind maturity modulation as a tax dodge. I just hope ICP holders in the US keep enough funds liquid to pay the tax guys who are sure to come calling.
@Denis, many of us in the community are concerned about the changes to maturity as a tax optimization (dodge) scheme, as well as the CF. I assure you people are seeing your concerns - please continue to voice your opinions.
We’ve just unwillingly accepted that DFINITY is going to push through these changes regardless of what the developer and named neuron community thinks.
I have to admit that I was stunned knowing that we talked about a proposal aiming to avoid/evade tax this freely. What made me feel more concerned about this is the proposal came directly from Dfinity itself.
I mean, seriously?
I’m obviously not trying to give advice. Although, I believe this is an absolute fact about USA users/ investors. It is what is making me nervous as well. I’m 85% there with understanding this process. However, I don’t feel US users can actively voice their opinion without creating FUD, or being run over by the community. So, I feel like I need to remain quiet with any of my concerns. However, I 100% agree, that US users might need to save enough liquid ICP to pay those taxes. It’s something that the community outside of the US is not going to particularly understand (zero judgment I wouldn’t understand the tax process anywhere else). As a noob, I did not grasp the concept (and still am struggling) however, I know when I sit with my CPA/ tax attorney this year things will be evident. It makes me think that USA users are either thinking let me bypass the tax man by not reporting my maturity, or join cf to make it even more complicated to determine for a lack of a better way of putting it. I’m thinking I cannot even join the CF until well after the optimization of taxes occurs, or it becomes clear what the IRS will be taxing. I truly believe soon enough we will be taxed on our maturity/ rewards. When I spoke to a local CPA/ tax attorney (yes I finally received legal advice for those who know I’ve asked in the past) he stated that my maturity to the state of NY would more than likely act as a dividend payment as if investing into a savings account. So, when US users are like this is complicated, we’re literally not kidding. Then, come tax time, the fees or fines individuals may end up accumulating in either back taxes, or unreported reward maturity could significantly outweigh any gains made. Not to mention if ICP goes upward and smaller investors now have over 10k it might create more confusion, and people inadvertently avoid paying the proper taxes. You may even end up spending more money on the fines and fees if you don’t keep some liquid/ report accurately. So, to me as a US user, I do not believe joining the CF is plausible. Nor, do I think that it helps any smaller investors in the US. I think for those in other regions it’s going to be amazing. For US users it’s going to be another opportunity we have to miss, in order to understand how to report it to our ungrateful, backstabbing, two-timing, joke of a big brother (aka IRS/ USA government). This is just my opinion. I’m not giving advice or suggesting US users panic. Just what Im discovering by investing in my area/ state. I really don’t know if the project can really reach more average investors and users in my area because of this issue. This would leave me to think that, yes, this is again only for elitist individuals who A. have enough invested they could pay a team to file. or B. really think they’re slick and the IRS ain’t gonna start coming down harder. or C. anyone living in loose tax jurisdictions.
, but I haven’t updated them since the svelte upgrade: