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ed49d34
feat: 🎸 WIP-Draft - Community Development Fund
Apr 8, 2022
ad6f056
docs: ✏️ template fix
Apr 9, 2022
a88afa7
feat: 🎸 WIP-0 - Governance Process
Apr 9, 2022
dad2bad
fix: 🐛 WIP-0 set to draft
Apr 9, 2022
c406540
fix: 🐛 draft
Apr 9, 2022
50fa0ea
Update README.md
Apr 20, 2022
2f2e601
fix: line spacing and delegation note
Apr 20, 2022
5a3d410
feat: 🎸 community development fund
mfw78 May 15, 2022
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75 changes: 56 additions & 19 deletions README.md
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# Governance Process

This document gives an overview of the WindingTree DAO governance processes, and how *you* can get involved.
This document gives an overview of the WindingTree DAO governance processes, and how *you* can get
involved.

It outlines a suggested process for developing and advancing WindingTree Governance Proposals.

The purpose of this process is to encourage discussion and help the community to get the needed information and sufficient time in order to review and vote on proposals.
The purpose of this process is to encourage discussion and help the community to get the needed
information and sufficient time in order to review and vote on proposals.

**Note**: this is a living document intended to be owned, modified and enforced by the WindingTree community.
**Note**: this is a living document intended to be owned, modified and enforced by the WindingTree
community.

## What is WindingTree DAO

WindingTree DAO is an open organization of developers, traders, industry professionals and many more community members aligned with its vision. WindingTree is focused on fair and decentralised *real-world service* trading systems - in particular building, maintaining and advancing the WindingTree protocol. WindingTree protocol powers a network of service providers, consumers, and solvers, enabling trustless and efficient real-world service trading, reducing reliance on centralised siloed market aggregators. Providing uniform *open* access to service provider inventory, reducing market information assymetry, are core to WindingTree's practices.
WindingTree DAO is an open organization of developers, traders, industry professionals and many
more community members aligned with its vision. WindingTree is focused on fair and decentralised
*real-world service* trading systems - in particular building, maintaining and advancing the
WindingTree protocol. WindingTree protocol powers a network of service providers, consumers, and
solvers, enabling trustless and efficient real-world service trading, reducing reliance on
centralised siloed market aggregators. Providing uniform *open* access to service provider
inventory, reducing market information assymetry, are core to WindingTree's practices.

## Vision

We foresee a future where service providers across all service-oriented industries will be able to librate not just their data and wealth, but also their income stream through decentralized blockchain-based marketplaces. WindingTree's vision is a decentralized world where *real-world services* can be traded in a **fair, efficient, and reliable manner** among people and communities around the world. Our mission is to build a protocol that places it's users - service providers and consumers - in direct connection with one another, reducing intermediaries, enabling all users to act in the marketplace knowing that they have *supreme transparency and fair price discovery*.
We foresee a future where service providers across all service-oriented industries will be able to
librate not just their data and wealth, but also their income stream through decentralized
blockchain-based marketplaces. WindingTree's vision is a decentralized world where
*real-world services* can be traded in a **fair, efficient, and reliable manner** among people and
communities around the world. Our mission is to build a protocol that places it's users - service
providers and consumers - in direct connection with one another, reducing intermediaries, enabling
all users to act in the marketplace knowing that they have *supreme transparency and fair price
discovery*.

We are determined to make WindingTree Protocol the **canonical marketplace** for the trading of *real-world services* by applying continuous innovation, encouraging intellectual discourse and expanding the WindingTree Protocol ecosystem - inviting the brightest minds to join the community.
We are determined to make WindingTree Protocol the **canonical marketplace** for the trading of
*real-world services* by applying continuous innovation, encouraging intellectual discourse and
expanding the WindingTree Protocol ecosystem - inviting the brightest minds to join the community.

## Forum

WindingTree DAO's `wips` Github repository discussion page is the main venue for governance-related discussion. Anyone with a Github account can post and participate in discussions.
WindingTree DAO's `wips` Github repository discussion page is the main venue for governance-related
discussion. Anyone with a Github account can post and participate in discussions.

Ad-hoc discussion may take place on [Discord](https://discord.gg/fGqeXzqKVU).

## Snapshot

[WindingTree DAO's snapshot space](https://snapshot.org/#/windingtree.eth) is a simple voting interface that allows users to vote on proposals. Votes on WindingTree are weighted by the number of LIF1 and LIF2 held or delegated to the address used to vote.
[WindingTree DAO's snapshot space](https://snapshot.org/#/windingtree.eth) is a simple voting
interface that allows users to vote on proposals. Votes on WindingTree are weighted by the number
of LIF1 and LIF2 held by the address used to vote.

## Governance Process

The WindingTree DAO governance process includes two steps for proposals to get approved.

**Phase 1**: Draft Proposal — Community Discussion (*min 7 days*)
The purpose of the Draft Proposal phase is to establish formal discussion around a potential proposal.
To create a Draft Proposal please follow these steps:
The purpose of the Draft Proposal phase is to establish formal discussion around a potential
proposal. To create a Draft Proposal please follow these steps:

* Create a new draft WIP using the template in the repository and submit via PR.
* Engage in discussion to build support for the proposal.
* If your proposal requires any additional on chain interaction by [WindingTree DAO](https://etherscan.io/address/0x876969b13dcf884C13D4b4f003B69229E6b7966A), you will need to write the code for your proposal while it is in draft stage. You may wish to wait until the proposal gathers some support before doing this.
* If your proposal requires any additional on chain interaction by
[WindingTree DAO](https://etherscan.io/address/0x876969b13dcf884C13D4b4f003B69229E6b7966A), you
will need to write the code for your proposal while it is in draft stage. You may wish to wait
until the proposal gathers some support before doing this.

Once you are confident the proposal is in a stable state, and *at least 7 days* have passed since the proposal was first published, you can ask a code reviewer (moderator) to move the proposal to phase 2 (merge into `main` branch).
Once you are confident the proposal is in a stable state, and *at least 7 days* have passed since
the proposal was first published, you can ask a code reviewer (moderator) to move the proposal to
phase 2 (merge into `main` branch).

**Phase 2**: Active Proposal — Forum / Snapshot

* Request that a code reviewer (moderator) advance your proposal to a vote by tagging them in the PR issue.
* Request that a code reviewer (moderator) advance your proposal to a vote by tagging them in the
PR issue.
* If the proposal has successfully finished phase 1, a moderator will:
* Assign the proposal a proposal number in the form `WIP-###`.
* Change the topic from `Draft Proposal` to `Active Proposal`.
* Create a [snapshot](https://snapshot.org/#/windingtree.eth) vote with a duration of 7 days, and cross link the snapshot and forum post.
* If your proposal should include an executable transactions, you will now need to provide the proposed transactions to be included in the proposal.
* [Gnosis Safe transaction builder](https://help.gnosis-safe.io/en/articles/4680071-transaction-builder) could be used to craft transactions to be included in a proposal.
* Create a [snapshot](https://snapshot.org/#/windingtree.eth) vote with a duration of 7 days, and
cross link the snapshot and forum post.
* If your proposal should include an executable transactions, you will now need to provide the
proposed transactions to be included in the proposal.
* [Gnosis Safe transaction builder](https://help.gnosis-safe.io/en/articles/4680071-transaction-builder)
could be used to craft transactions to be included in a proposal.

## Governance Parameters

* Final approval of proposals will be made through `LIF1` and `LIF2` token voting on the [windingtree.eth snapshot space](https://snapshot.org/#/windingtree.eth).
* The required quorum for a *WindingTree Improvement Proposal (WIP)* to pass is defined by a set limit of `999057.5780542548` `LIF1` and `LIF2` (4%) tokens required to vote **YES**.
* Additionally, in order for a proposal to be approved, **YES** votes should account for **>50%** of total participating votes. (simple majority)
* Final approval of proposals will be made through `LIF1` and `LIF2` token voting on the
[windingtree.eth snapshot space](https://snapshot.org/#/windingtree.eth).
* The required quorum for a *WindingTree Improvement Proposal (WIP)* to pass is defined by a set
limit of `999057.5780542548` `LIF1` and `LIF2` (4%) tokens required to vote **YES**.
* Additionally, in order for a proposal to be approved, **YES** votes should account for **>50%**
of total participating votes. (simple majority)
* Once a proposal is approved, if this proposal includes executable transactions, WindingTree's
multisig signers will meet and execute the proposal.
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# WIP-Draft: Community Development Fund

> * WIP: <to be assigned when moved to phase 2>
> * title: Community Development Fund
> * author: mfw78 <mfw78@protonmail.com>

## Summary

Funding of a *Community Development Fund* to be used for active development of the Winding Tree Ecosystem, controlled by the community.

## Motivation

Currently all Winding Tree development is steered by the Winding Tree Foundation. As Winding Tree seeks to empower it's community and migrate towards a DAO, it's critical that that community gains an increased ability to steer protocol development. Resources are required to fund community and protocol development, and by passing ownership of resources to the fund, this capital can be steered by the collective intelligence of the community's *hive mind*.

This will ensure that resources are placed at the disposal of the community, to the direction and benefit of, service providers and consumers.

## Specification

Initially fund the *Community Development Fund* with *50%* of the Winding Tree Foundation's ICO allocation.

> * ICO Participants: 19,981,233.161085093075135945 LIF
> * Foundation: 4,995,308.290271273268783985 LIF
> * Total: 24,976,541.451356366343919930 LIF

Of the [4,995,308.290271273268783985 LIF that vested to the Foundation](https://etherscan.io/tx/0xc167ce97de7b0713b25c33469bf85564acb4fa21ec165e03b1bb67aeb851c3ce), this was distributed as follows:

> * Founder Vesting: 2,557,597.844618891913617400 LIF
> * Team Pool: 1,438,648.787598126701409788 LIF
> * Foundation Vesting: 999,061.658054254653756797 LIF
> * Total: 4,995,308.290271273268783985 LIF

The current balances of the Foundation and Vesting contracts from the above are:

> * [Founder Vesting](https://etherscan.io/address/0xed7eabc86201e647e37bb53419a7ad69bfc5b944): 1,918,198.8446188919136174 LIF
> * [Team Pool](https://etherscan.io/address/0x0961b92b438d782a6dae5504cf52755325f30e8b): 422,060.0375 LIF
> * [Foundation Vesting](https://etherscan.io/address/0x41a09d330f3d9bc4d269bfa872bc06db1c5a04fc): 999,061.658054254653756797 LIF
> * Total: 3,339,320.540173146567374197 LIF

In line with the Founder's belief in WindingTree, the Founders will allocate funds required to ensure that
50% of the Winding Tree Foundation's ICO allocations are committed to the *Community Development Fund*.
Contributions are proposed as follows:

> * Founder Vesting: 1,076,532.449581381980635196 LIF
> * Team Pool: 422,060.0375 LIF
> * Foundation Vesting: 999,061.658054254653756797 LIF
> * Total: 2,497,654.145135636634391993 LIF

This therefore meets the intention of 50% of **ICO** allocation, and represents a contribution of **74.8%** of the remaining allocation.

## Rationale

This proposal aims to meet two key points in the DAO transition:

1. Funding of a community treasury to be used to further protocol development.
2. Increase decentralisation of token holdings to ensure fair governance.

The point for (1) is obvious in that any community needs resources in order to develop. The most important point for this proposal is (2) as it in effect reduces the tokens held by the team, reducing their voting power and in doing so, reduces the voting power centralisation as Winding Tree is migrated towards a DAO.

### Voting Power Distribution

As Winding Tree progresses through it's DAO transition, the distribution of holdings is key to ensuring robust governance. Currently there are 7.1M tokens claimed for LIF2, with tokens held by Foundation vesting contracts still not claimed on LIF2. Of these 7.1M tokens, approximately 6.5M belong to active investors monitoring their portfolio, with the other 0.6M belonging to the team and deployed in various liquidity programs and/or bounties/raffles.

If there were to be no distribution to the *Community Development Fund*, the team would wield a voting power of approximately 3.3M, or nearly 33% of all active voting power. In a "simple majority" vote-counting case, this would require at least half of active investors to mobilise against the team. In keeping with the vision of being an inclusive protocol, favouring service providers and consumers, more voting power needs to be given to precisely that community.

By foregoing 2.497M LIF, the team would command approximately 1.4M LIF voting power, or approximately 19% of active LIF. This reinforces the team's intentions from ICO that they would not maintain an interest of more than 20% in LIF.

## Execution

In executing this proposal, the community development's funds would be bridged to Gnosis Chain and sent to the community multi-sig located at [0x07AED86bda7B36079296C1D94C12d6F48Beeb86C](https://gnosis-safe.io/app/gno:0x07AED86bda7B36079296C1D94C12d6F48Beeb86C/home).

### Safe Transaction Hash (TBD)

<tx hash> (*optional)

### Safe Transaction Data

Mandatory for every proposal that requires transaction from Winding Tree DAO.

<payload>

### Tenderly Simulation

Mandatory for every proposal that requires transaction from Winding Tree DAO.

Link to Tenderly simulation

## Snapshot

*Phase 2 Proposal: Add a link to the corresponding Winding Tree Snapshot poll you’ve created.*
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