I want to thank @tsetse for raising these questions. They are ones I also raised several months ago, going through the exact same steps, finding (and translating) the same docs. I think like @tsetse, I was genuinely hoping to find some great answers, something I could use to settle my growing doubts and commit myself, my money and my dev skills to making ICP flourish.
I did not quite get the responses you have, and you did not get the pushback I met, and it gladdens me to see the community moving forward in this way. I see similar shifts in people questioning other elements I questioned then, and being met with resonance, rather than an instinct to call FUD and do away with unpleasant cognitive dissonance.
But much as I appreciate @diegop’s brave attempt at damage control (I feel for him in the circumstances) I don’t think this long thread has moved the discussion forward one iota. It’s been responsive and polite and “we are all friends” and “hope that was clear, let’s just stop thinking about this now and get back to talking about how great ICP can be”. But I don’t believe a single one of your questions has been satisfactorily answered any more than mine. So having been reasonably gentle and watching the wheel come back round, and 76 answers later no movement forward at all (perhaps a couple of movements back) I ask your indulgence if I allow myself a little bit more emphasis and directness this time.
For all the tone of normality in the replies (“just boring bureaucracy”), the fundamental fact is anything but normal, and boils down to this: the great society-decentralising, trustless agent, Dfinity, has exactly 2 people in absolute legal control. Dominic, and a stand-in lawyer required by Swiss law. So make that 1 guy (and his token Swiss lawyer).
1 guy. In total, absolute control. Can shut down Dfinity tomorrow. Can replace anyone. Can veto any project. Or shape it. Can implement a backdoor (not saying there is one, just speaking to the power of his position). A single monarch of Dfinity, as an evangelist of the utopia of decentralisation. Cognitive dissonance anyone?
People will shout “alarmism!” “conspiracy theory!!”, but it is not. It is, to paraphrase Diego, a boring, bureaucratic fact. When you concentrate the power of the CEO and the power of the Board in one person, and your articles of association do not incorporate checks and balances (annual reports, financial disclosures, minimum board numbers, rotations, conflict of interest rules and registers, etc, etc, etc) you give absolute power to the CEO. When 1 man alone (and his token Swiss lawyer) is the board, the CEO and the Chief Scientist, without constitutionally mandated public information flows, you’ve taken a legal structure designed for accountability, and turned it into the emperor’s new clothes.
“But it’s a non-profit!” I hear a believer shout. Doesn’t that make him one of the good guys - or rather the single good guy (and his token Swiss lawyer)? What’s the worry about the concentration of so much power, influence and commercial intelligence in a single person, if they can’t profit from it?
Well, here are some questions:
Who decides Dom’s non-profit salary and benefits?
Dom does.
Who knows what Dom’s salary and benefits consist of?
I can’t guarantee it, but I would be astonished, given the general approach to transparency, if anyone beside Dom and the token Swiss lawyer knew. What really matters, is that if Dom doesnt want to disclose it to anyone in Dfinity, he doesn’t have to.
If Dom wants to fund projects he might derive a personal interest from, say via friends, family or proxies, could he?
Why, yes, he could.
If he did fund projects he, his loved ones or proxys benefit from, would he have to disclose it to anyone, inside or outside Dfinity?
Probably, to the token Swiss lawyer. That’s it. He wouldn’t even need to tell the token Swiss lawyer that it’s a personal associate, just: “we’re funding this.”
Does anyone know if Dom has any ties to the early ICP rug pullers who made the billions?
No one can ever know. We do know there is no legal, consitutional or administrative process that would lead him to verifiably tell us.
Is there one, single, tiny check or balance on Dom’s ability to benefit from sole control of Dfinity in ways direct and indirect?
Nope. As long as he doesn’t obviously break the law, there are no constraints.
The entire philosophy of the blockchain is trustless transactions. Is it not ironic that the entire organisational, financial and legal philosophy of Dfinity is “trust Dom, he is a dom, but he’s our Dom”?
You may think this is hyperbole. But this was precisely the answer to the question of legal, financial and institutional transparency that opened this thread.
“we have been advised that since we are living in a world of highly-financed bad actors launching surreptitious attacks and FUD, we have been advised to hold off on financing info.”
= “sorry, you will never know what goes on with our finances.”
That makes absolute sense and is pretty boring and conventional. For a small commercial entity. In some jurisdictions. Sometimes.
(Shhh. Don’t mention that there are of course plenty of businesses, including the biggest ones, living in a world of even better financed competitors eager to launch attacks and FUD. Who nevertheless publish their annual accounts.)
There is a HUGE zone between “we will keep sensitive financial info confidential”, and “we will disclose not a single fact about our finances to the thousands who have poured their savings and energy into our project”. That HUGE zone, occupied by every listed company, as an example, and 99% of smaller companies in UK for example, doesn’t exist for Dom, and therefore for Dfinity, since, legally and constitutionally, Dom’s will, is Dfinity’s will, no ifs, no buts.
Who is the “we” and who is the advisor here?
This model is not unheard of in private businesses. It might not get you a responsible business award or qualify you as a B-corp: but it’s a common way of running a private company. But Dfinity is not a private company. Dfinity, for all the money it manages, the VC funding it attracts and the startup feel of its operations, is (meant to be) a non-profit entity. Ask most non-profit foundations in the world (I run one and advise many): Dfinity’s total lack of financial transparency, their one person governance, their absolute absence of governance checks and balances, is not good, or even normal, non-profit governance.
“Yes there is a board. It really is no different than other Swiss foundation boards. Dom and Gian Bochsler are on the board. Why is it not on the website? They are both in the “leadership” tab of https://dfinity.org/ . Is it obvious at first glance? No, I do not think so. I take blame here as the new manager of the website team.”
Nothing to see here folks, it’s just a website issue. Should have added a mention in the about us link. Sorted. This is exactly how non-profits work. Boring, normal stuff.
Is it really though? Find me a multimillion dollar non-profit with hundreds of employees and complex financial operations, who has a single person on the board (and the token lawyer), who also happens to be CEO. It is pretty rare in the non-profit world, and they tend to wear shirts that say “I’m sketchy”. To be fair to @diegop, this internationally extremely rare breed of non-profit tends to be found in Switzerland, for the same reason other birds of “sketchy” financial plumage are observed in that habitat: secrecy laws.
" Yes, the foundation has all the paperwork, meeting minutes, etc… of a Swiss non profit. Tbh, pretty boring stuff."
Sounds normal. Apart from the fact that it is not really that normal, for the minutes to consist of whatever Dom (and his token Swiss lawyer), decide to write down. Do the minutes state any bonuses the board decides to award its CEO? Let’s ask the CEO, who is the only member of the board (with his token Swiss lawyer). Do they state what projects money will go to? Who knows? Who cares? Who gets to read the minutes?
If you were the only member of your company’s board (with your token Swiss lawyer), how often would you arrange to meet yourself? How would you handle disagreements with yourself? Would you put it to a vote? I suspect those board meetings are, as Diego puts it, boring indeed, and very, very quick.
Asked by @tsetse if Dfinity are aware of the reputational costs of zero transparency, @diegop replies:
“DFINITY definitely very much aware. We know it is a painful, painful stand DFINITY has.”
It definitely must be painful to Dfinity staff sent out to defend the indefensible. And I am sure Dom is very, very aware. After all, he could have chosen any jurisdiction to build his non-profit. He must have searched hard and wide until he found the single most secretive jurisdiction that would legally entitle him to run a foundation as a sole board member (with a token Swiss lawyer) with absolute control and, precisely speaking, zero accountability.
But I don’t think it’s painful for Dom, let alone painful, painful. I think it’s actually quite nice for him really. He doesn’t even have to answer himself, because, as Diego explains, this doesn’t meet the “super-important” C-level threshold. The current situation, for Dom, is a carefully curated feature, not a bug. I have founded many non-profits, local, national and international. I have worked with over 1000. I can tell you that you don’t achieve such lack of transparency and accountability, with such singular control over so, so much money, without serious effort.
Astonishingly, Diego’s answers did not end the questions. Some people bizarrely still wanted to know how to find out whether Dfinity was solvent enough to keep running, to decide whether to invest. Absurd right?
@zire then chipped in.
"FWIW, I just wanted to say these:
We have sufficient means to support the team. Nobody has missed any pay check. I think we’re well positioned to live through this crypto winter"
Ah good then. Let’s carry on creating our trustless system. After all, that was pretty much the same thing SBF said about FTX a few days ago, and it worked out for them. Wait.
“Dom is not a conventional leader by any means, but he’s our Dom… As an employee of DFINITY and a believer of IC, I’m betting on him.”
So that’s what the entire legal, financial and ethical structure of Dfinity boils down to: be a believer, gamble, and make Dom your dom.
Finance records? Who needs them to invest:
Believe, gamble, follow your Dom.
Conflicts of interest? Who needs checks and balances:
Believe, gamble, follow your Dom.
Unlimited authority? Who needs observability into the decision making process or even the decisions themselves:
Believe, gamble, follow your dom.
The problem, to close the circle and return to the origin, is that every single non-technical decision taken by Dom speaks to a lack of trustworthiness. Out of all the institutional frameworks, he shopped for jurisdictions worldwide until he found maximum control, maximum secrecy, and minimal accountability. He then oversaw a launch that displayed the fastest inflation of a currency, the buying of currency from his own employees, a set of demonstrable, universally acknowledged but still shadowy transactions that made people billions, precisely when 99.99% of investors were locked out and could only yearningly watch; before plummeting just as the lock expired at a rate far exceeding that of the wider crypto market and in rhythms that tracked precisely with the movement of ICP coins during and after the lock-in.
I don’t think it’s FUD (“heretic!”) to question, in a collective endeavour to build a decentralised internet why Definity (ahem Dom) choses to structure itself as an uber-centralised pyramid calling the shots with a single man at the top with absolute no accountability and zero checks and balances.
I don’t think it’s FUD to question why in a beautiful project to achieve a trustless economy, Dfinity (ahem Dom) chooses to operate entirely on trust, or really, more accurately, entirely on faith in our benevolent leader (he may be Dom but he’s our Dom), that requires everyone whose investments and life goals are tied to the project, to just say “whatever you say” to their Dom, particularly when Dom has not given any sign of being particularly worthy of retail investors’ financial or institutional trust. Who needs an investor’s trust when you can have a believer’s faith?
In closing, I just want to emphasise the key word in my last two paragraphs: choice. Dom is not tied by some existential constraint. No FUD goons are pinning Dom to his chair. In one instant, he could add seats to the board. Include ICP investors, creators, advocates. Literally in one instant. He could tell his token Swiss lawyer: please copy and paste the statues of 99.99% of non-profits and reword for our purposes. Voilá. Checks, balances, accountability, and trust, for when faith won’t carry you.
It would take an hour with a financial advisor to say: what information can I share without risking the future of Dfinity, ICP and the planet? And then ask his accountant to share it. It might actually take 15 mins of his time, since there is not exactly a lack of examples to draw on for public financial disclosures that miraculously have not destroyed the companies making them every year.
@diegop wrote: “No one has answered this thread for boring bureaucratic reasons.” I think this remains the case. The bureaucratic reason of a non-profit with Swiss jurisdiction with a sole person of significant control, who has no interest in sharing with anyone any facts whatsoever that could curtail his ability to do, say, pay others or himself, exactly as he pleases, with zero external visibility outside of what he himself curates.
The ethics of it aside, and that’s an unbridgeable aside for me, I don’t think this is either viable or sustainable. I think, with the many fragilities around ICP ecosystem centralisation, node concentration and inflation, voting power concentration, acknowledged gaps in data protection, environmental impact of a costly architecture, and other tricky, but perhaps solvable stuff, the current institutional and legal structure, privileged and opaque information environment and Dom’s unrestricted, unaccountable, secretive and ethically compromised position of absolute authority; coupled with the irrationality of crypto belief (as opposed to trust and verification); are existential risks that don’t bode well for Dfinity, ICP, and specially ICP’s investors (as if the devaluation was not enough indication!).
I also think, whether Dfinity and ICP thrive, or crash and burn in the future, Dom will be just fine, and profit from the outcome. Leaders in his position tend to implode from the cummulative impact of character choices, not a particular set of logistics, and thrive until the moments before implosion. Just ask FTX.
I genuinely love the concept of the Internet Computer. I hugely appreciate the extraordinary brain power, innovation, creativity and community. It is deeply seductive, because I want to believe. I am perhaps somewhat shielded by the lack of a personal profit motive: I’m not imagining myself an ICP millionaire in addition to this wonderful project.
But if I replace the urge to believe, with an urge to trust and verify, then I find this fantastic, inspiring structure resting on a foundation of cards. Probably bank cards. Probably Dom’s and a small circle. Probably not (any longer) in ICP. And one character flaw away of taking the whole thing down.
I’d like to be wrong, and I’d check against the facts, if only one could, beside Dom. And his token Swiss lawyer.