Messing around with tokenomics shouldn’t be easy as it is right now, on other chains changing the smallest thing about the protocol is a huge deal, on the IC you just need 3% of voting power, this has to change as it is unfair towards 8 year stakers and makes staking less appealing for outsiders and newcomers.
I think at the very least the minimum VP required to pass a proposal has to be raised and for every changes to tokenomics there should be a 30 days timeframe to allow unhappy stakers to immediatly dissolve their neuron, such a change wouldn’t just be fair towards stakers but also incentivize good tokenomics proposals, cause if something were to pass without a clear majority there is a risk of lots of tokens being released on the market.
One thing I’m starting to think about…if ICP is just a voting token, and doesn’t want to be a security, then it shouldn’t have a “real money” counter value, should it? Let’s face it, I staked my neuron because I was going to be able to participate in building the network, yes, but also for the passive income, and I think most people staked because of that initial promise. A new series of questions are arising atm. Why should anyone lock for 8 years with the NNS for a 20% APY when you can stake on Binance with a 120 days lock for 25%+ APY guaranteed, without the burden of voting manually, or assuring you follow someone that votes for you?
One could say that contributing to building the network is like contributing to your local government to keep building your surrounding society. So you pay taxes in order to receive services like healthcare, road maintenance, legal assistance, etc. If ICP is not a security, if it’s not a way of receiving passive income, where’s the benefit? What am I, like others, getting except glory for building an utopic future?
Might have gone a bit off-topic I guess, but the last few days got me wandering a bit. I don’t have solutions in mind, I don’t have a background in political, economic, nor technical topics. I’m just throwing out what I think could be food for thought.
You are right that active stakers would get more rewards initially. In some ways it is the mathematical equivalent of submitting an infinite number of governance proposals every day without submitting any spam proposals, at least in the beginning. That’s why it removes the incentives to spam the NNS with governance proposals. They are no longer needed if the spamming is happening for the purpose of higher voting rewards. Those higher rewards for active neurons currently come at the expense of inactive neurons not voting on governance.
To be clear though, the reason this proposal can be an effective tool is that it incentivizes all neuron owners to actively participate in governance. It would be a very strong incentive. Anyone who is staking can intentionally configure their neurons. If they did so, then ideally we would have 95+% participation in governance topics. Anyone who is getting zero voting rewards will eventually ask questions, educate themselves, and select Followees based on intentional decisions instead of default neuron configurations that lead to a completely passive approach and lack of participation in governance.
I really like this idea. It should be shaped further. It would disincentivize changes to tokenonics for sure. I suppose a counter argument is that people who want out of their NNS stake would be more likely to push for changes. That seems like a loophole that would need to be addressed.
If the NNS is the hub of democracy for the IC, then I think there should be representatives that make policies, bills etc., and submit them on behalf of the voters, like in real life. The difference with real life is, that if I decide that I don’t relate anymore with the values that one of the representatives I follow pushes forward, I just unfollow and vote manually or pass my voting power to someone else and don’t have to wait for another political campaign to occur. So, maybe, the idea of different DAOs, like @Heihachi previously said, that treat governance on the IC and commit to proposing, deliberating, and executing isn’t that bad after all. So a nice set of rules and guidelines should be redacted. Long-term perspective.
Short-term perspective, I think that a 3% “Yes” threshold could be good, as well as the implementation of a “Irrelevant” “Ignore” or whatever you want to call it button.
Remember that seed investors didn’t know their neurons will be locked until after launch day. They are forced into this NNS governance participation. So naturally many are not participating. They wanted exit, but none was given. That wasn’t fair either. Foundation really screwed up hard on this launch thing, had the seed investors been able to provide more liquidity, ICP price would not started at US$700, and we (the community who believed in this project) would have a better position to present to the world.
I appreciate the intention and work behind this proposal, but am against this proposal as I believe:
It would have the impact of disproportionately rewarding investors who are following the day to day or even week to week action, over more passive investors.
It will not have the intended impact of stopping low quality proposals targeted at investor profit. If anything, the group of investors involved in this proposal spamming scheme are coordinated and active - resetting the followees would only give them a chance to temporarily earn greater rewards from governance proposals while the rest of us find time to set up our followees again.
We essentially already did this reset when the governance voting rewards and topic was split out from all of the other voting topics a few months ago, requiring all NNS participants to actively update their governance followee neurons. If this proposal passes, what’s stopping a proposal from being passed every 2-3 months to reset the followees and ask NNS users to “actively participate”?
If we want more people to become IC investors, we shouldn’t penalize them for their passive investment. It sends the message that “hardcore or more involved IC community members are looking to directly profit or benefit from their investment”, which is a dangerous label which that will scare off both small retail and larger investors.
Through tools like maturity merging (which can be done daily instead of annually for increased rewards), active investors are already rewarded over more passive investors.
I could potentially be on board with a reset cadence that might make sense, but it should give investors adequate time to preconfigure their new followees before the change is made instead of resetting at a distinct moment in time and only after the reset has taken place. For example, DMV car registration is on an annual basis, and car owners are allowed to purchase their next year’s car registration at some time in advance of the expiry date. I could definitely get on board with a scheme like this that resets neuron followees every year, but allows NNS participants a grace period in choosing their neuron followees that will apply once the next reset takes place. As a con to this approach, it makes the investing in the IC a more complicated and involved investment than most others that a retail investor would have in their current portfolio (i.e. Bitcoin, equities) → which can be a drag on overall IC investment and adoption.
You either have enough skin in the game or you don’t, people care after a certain % of their money and future is at stake. Not trying to be rude, but I think we can all see where you fall on that spectrum by your statement.
I think you are way off-base here. Staking on the NNS was “sold” as a way to make passive income without needing to be actively involved…and in fact there are many articles on adding followees so you never MISS casting a vote. I try to vote on every governance proposal myself, not because of a hope of increased rewards, but because I want to be part of shaping this thing we are all building. I read the proposals and any discussions so I can make an informed decision. If it’s over my head or if I just don’t have the time, I rely on ICPMN to make the proper decision for me. On many of the other categories, such a node provider rewards, or technical proposals that I’m clueless about, I trust that the neurons I follow know more than me and will cast the proper vote. If manual voting is required, watch everybody just go with the flow anyway, or throw in an opposite vote because all that matters is getting paid, right? When your money (whether 1 ICP or a million) is tied up for at least 8 years, how can that be considered freeloading?
#4 The system should not be used for the intent of increasing rewards for any parties, talk of this kind should be taboo or at least highly discouraged as it presents the wrong ideology to new community members.
#5 The NNS shouldn’t be used for asking changes/features in 3rd party dApps, this is why the SNS is being built, there will be a time and a place for proposing changes in dApps utilizing the SNS.
I disagree heavily, dedicated liquidity providers are the ones who provide liquidity when an asset opens for trading and that is determined by the exchange, not by individual investors. Dominic has already pointed a finger at FTX, he likely has information we don’t.
It is not normal to see any kind of IOU only trading for half of the opening price of the actual asset leading into the launch, highly doubt liquidity is the culprit because IOU’s were even less liquid.
So possibly we should involve in the discussion @diegop or other people from Dfinity…?
I feel that it would be good to prevent proposals with duplicated goals, each eventually taking different approach.
Plus to me it seems that the extra rewards for Governance proposals are decreasing, so it might even fix itself - if all (majority of) stakers will start to vote or follow some other neuron (they must have noticed decrease in rewards already).