Cycles management of Gold DAO

Governance SNS Project Governance
1

Background

All canisters on ICP need to be funded with cycles due to the reverse gas model. The canister cycles of the Gold DAO are currently managed via CycleOps, which allows to easily set topup rules for canisters controlled by the SNS. Up to now, the main team contributing to the Gold DAO has used developer funds to provide ICP to the wallet in CycleOps. These funds are coming from a limited resource as they were taken from the Gold DAO’s ICP treasury. This makes the cycle funding directly dependent on the developer team.

All canisters of the Gold DAO consume roughly 400 TC per month, so about 70 ICP, given the current price of ICP. Given the upcoming release of GLDT and related canisters and the recent demand to add compute allocations to some canisters, this could realistically increase to 500-600 TC per month, or 80-90 ICP per month. This adds up to roughly 1000 ICP per year.

Proposal

To ensure long-term viability, the team proposes to use parts of the ICP rewards from the Gold DAO NNS neurons for cycles management. The Gold DAO owns 7 NNS neurons (see here) of which the ICP rewards are distributed to four different destinations

  • 33% to active DAO members
  • 33% to buyback&burn
  • 33% to liquidity management
  • 1% to the Good DAO

Whenever one of the neurons reaches 1000 ICP of maturity, this maturity is spawned and distributed according to the share above. Given that roughly 550k ICP are staked in total and almost all locked for 8 years, these yield around 70k ICP rewards per year.

The team now proposes to add a clause that whenever the ICP balance on the CycleOps wallet is below 1000 ICP, the maturity should be sent to the CycleOps wallet instead of distributed according to above. Given the current cycles consumption of roughly 1000 ICP per year, this should happen around once per year. This guarantees a reserve of ICP for cycles usage and avoids any outages due to cycles running low and only reduces the ICP rewards of the DAO by about 1/70th ~ 1.4%. On top, this reduces dependency on the developer team and provides a long-term sustainable source for cycles funding.

Next steps

  1. Collect feedback from the Gold DAO community about this proposal
  2. Let the proposal go through an actual motion proposal
  3. Implement the required changes into the code base
6 Likes
3

ICP staking rewards from WTN investment of the Gold DAO will be distributed to the DAO members. See this proposal.