- Stakers
- Elite Council
- treasuryDAO
- Management Contributors
- adminDAO
- Core Contributors
- devDAO
- marketingDAO
- Product Elite
- marketingDAO Grants Council Trial
Kwenta governance follows a democratic structure with multiple semi-independent governing bodies, each with their own goals and operational structure.
To participate in Kwenta governance, community members must be staking KWENTA.
To become a staker, KWENTA holders can use the Kwenta staking interface to stake their tokens enabling them to acquire voting power in elections and on CKIPs. Voting power is determined by the amount of KWENTA a community member has staked (Ex. 1% of the supply is worth 1% voting power in elections and CKIPs).
Token holders will vote every 6 (six) months on 5 community members to operate the Elite Council. To win an election candidates must have been assigned enough voting power from stakers to be among the top five candidates with the most voting power. To become a candidate community members must nominate themselves in Discord once a nomination period has been opened by the adminDAO at the end of an epoch. The Elite Council will be responsible for voting to pass or block KIPs. Proposals must reach a majority to pass (3/5 votes or 4/6 votes in the event the president uses their additional vote). Meta-Governance proposals require unanimous support.
One of the 5 Elite Council members will become the President. The President is elected within the Elite Council, requiring 3/5 members' support. The President will be responsible for the strategic direction of the protocol and will have one additional vote of power representing the equivalent of two Elite Council members.
The treasuryDAO controls the treasury, investment, and growth funds for the Kwenta DAO, working with the adminDAO and Elite Council to use funds for bootstrapping the protocol and ensuring long-term sustainability. The treasuryDAO is composed of three anonymous signers where only ⅔ signers are required to send a transaction. The treasuryDAO is voted on by the Elite Council via a closed process. Core Contributors and Elite Council members would be the only community members to know who operates the treasuryDAO. At least ⅔ treasuryDAO members must be non-council members. ⅔ members must not be on the adminDAO. An election for the treasuryDAO would only be held when a rebalance of members is required, a forced election would not be held in the same cadence as the Elite Council. TreasuryDAO members have a maximum term life of 1 year before they need to be reelected.
There are only two management roles currently available: operations management and development management. These positions can be reduced or expanded upon with the introduction of a KIP. These are senior positions held by individuals that are responsible for ensuring their branch of the protocol is functioning smoothly. These individuals are responsible for delivering on roadmap goals by coordinating with other DAO roles. Management Contributors will have structured packages as a retainer for their services. Only Core Contributors are eligible for this position.
- The adminDAO is responsible for overseeing the implementation and management of the Kwenta State Log; this includes collaborating with community members to issue new KIPs as well as identifying when a KIP proposal has been completed.
- Appoint, dismiss, and identify new roles for DAO members as well as manage their corresponding grants.
- Facilitate administrative duties such as travel planning, expenses management, and governance proceedings.
The adminDAO manages all DAO roles other than the treasuryDAO (with the exception of some curation on the part of the adminDAO) and the Elite Council. The Core Contributors, Product Elites, marketingDAO, and devDAO will be under the purview of the adminDAO.
In the event the adminDAO finds that an individual is needed to fill a delivery gap in the protocol, the adminDAO can either appoint someone directly or they can open an application box for a fixed period of time and select a candidate from the application box. The adminDAO is responsible for active recruitment in the event that no optimal candidate has been found. The adminDAO, in collaboration with Management Contributors, will vet candidates with whatever means they deem necessary. Compensation packages must have adminDAO, Management Contributor, and treasuryDAO approval. The adminDAO and Management Contributors must be in agreement with the decision to hire a candidate. If one party supports the hiring of a candidate while the other does not, they can bring it to the attention of the Elite Council where a vote can be done on whether to offer the individual the DAO role or not. The Elite Council and adminDAO must be in agreement in the event a Management Contributor is appointed or dismissed.
Future treasuryDAO members (eg. new additions or replacements to the current treasuryDAO) will be appointed by the Elite Council, however, they cannot choose more than one council member to be on the treasuryDAO. The adminDAO will be responsible for confirming that the Elite Council did not choose more than one member on the Council as a treasuryDAO member, as treasuryDAO members are anonymous to the public, only the adminDAO, Core Contributors, and Elite Council will be aware of who the treasuryDAO members are.
In the event a DAO member needs to be dismissed from their position, driven by either the adminDAO or Management Contributors, the adminDAO, as well as the Management Contributors, must be in agreement (⅘ members of the adminDAO and Management Contributors signal their agreement) with the dismissal. If one party agrees while the other does not, they can bring it to the attention of the Elite Council where a vote can be done on whether they dismiss the individual or not. Once a dismissal has been approved, the individual will be given two weeks’ notice by the adminDAO. Any outstanding package agreements will be paid out if applicable and the privileges of the DAO member will be removed at the end of a two-week period. The adminDAO and Management Contributors retain the right to alter the two-week process in the event a DAO contributor has displayed malicious behavior that can harm the integrity or reputation of the DAO.
In the event a DAO member decides to recuse themselves from their role, they will inform the adminDAO and provide two weeks' notice prior to the date of their dismissal. The adminDAO will then either open an application box or appoint someone to replace the role directly (as noted in the DAO role appointment process). Once the applicant has been selected, the new DAO member will take over the position as soon as the existing member's dismissal date has been reached. The adminDAO retains the right to directly appoint someone should they feel an ideal fit for the role is available. DAO members that properly follow the quitting procedure are eligible for a 200 sUSD reward for their compliance.
It will fall under the adminDAO to regularly do performance evaluations in collaboration with the Management Contributors. The review will analyze DAO role output, their engagement with the community, and any other factors the adminDAO feels are worthy of consideration. It is up to the adminDAO to establish a cadence and process for performance reviews. Performance reviews help identify DAO members deserving of additional rewards as well as DAO members holding back the potential of the protocol. It is up to the adminDAO to determine how to proceed with the information obtained from performance reviews.
As subDAOs increase in sophistication, it will become prudent to add more roles that are compensated by the DAO. The adminDAO will work with subDAOs to identify these new roles and determine if the DAO has the capacity and budget to support their establishment. A new role can be filled by direct appointment or an open application box (as noted in the DAO role appointment process).
The yield earned from staking the Kwenta treasury will be used to compensate DAO roles. It is the responsibility of the adminDAO to establish and honor DAO role grants. The treasuryDAO retains the right to adjust the amount of rewards the adminDAO has access to at any time. The adminDAO will only have the ability to assign how much a given address will get from the yield being generated by the DAO; they will not be able to custody those funds. At the end of the four-year inflationary period, the DAO will use the 20% of inflationary rewards, along with any other incentives stakers collect, allocated to the treasury to continually fund roles in the same manner as outlined above. In the event a DAO role requires a structured compensation package, the adminDAO will propose a package to the treasuryDAO who will then approve, adjust, or decline the request.
The adminDAO is responsible for identifying a productive way to distribute bonuses to DAO participants that have a strong positive impact on the DAO. Some possible examples include milestone-based bonuses for relevant DAO members or a recurring community-wide voting mechanism. The establishment of this mechanism will be the responsibility of the adminDAO members; the adminDAO can experiment with bonus structures as they see fit. The treasuryDAO will be responsible for establishing a budget for bonuses.
Individuals can have multiple roles. It will be up to the adminDAO to reach a decision (⅔ in support of the motion) to assign an individual multiple roles. The only members that cannot have the same role are future additions or replacements to the treasuryDAO as they cannot also be Elite Council members.
The adminDAO will be responsible for tracking and working with the treasuryDAO to compensate DAO roles when applicable for the following areas: travel expenses, software tooling stipends, benefits stipend, vacation tracking, and record-keeping. A high-level breakdown of how funds are being used can be requested from the adminDAO by the community at any time. For any information deemed sensitive (ex. an individual’s grants package, an individual’s token package, etc), community members are required to have a trusted label to access this information.
There are three seats available within the adminDAO. One seat is controlled by consensus of the Core Contributors, one seat is controlled via consensus of the Elite Council, one seat is controlled via consensus of the Management Contributors. Since adminDAO membership is not epoch-dependent, the only time a seat would be changed would be in the event consensus among one of the groups changes and a seat controlled by one of the three groups needs replacing. In the event that either the Core Contributors or Management Contributors are unable to appoint a new adminDAO member, the Elite Council holds the right to fill in the gap.
In the event an adminDAO member decides to recuse themselves from their role, they will inform the Elite Council and provide two weeks' notice prior to the date of their dismissal. The Elite Council will work with whichever group has control of the given seat to coordinate on establishing a new adminDAO member. adminDAO members that properly follow the quitting procedure are eligible for a 200 sUSD reward for their compliance.
In the event the Elite Council, Core Contributors, or Management Contributors decides that their adminDAO representative member is no longer a fit for their role, they can forcefully remove someone from their role by stripping them of their ability to access adminDAO-related responsibilities. This would be done by majority ruling of the relevant subDAO for their adminDAO representative. The Elite Council with the respective group to find a new representative for their adminDAO seat.
Core Contributors are individuals that the adminDAO recognizes can provide continual value to the Kwenta protocol through their specialty. These individuals receive recurring grants from the adminDAO as a retainer for their skills and will act as resources for the devDAO PM, marketingDAO PM, and Management Contributors to deliver on their goals.
The devDAO provides an interface where community developers can monitor open tickets with their associated reward. The Core Contributors are responsible for providing a board. A reward would only be given to a community member in the event that a pull request for a given ticket was evaluated by an auditor and merged by a Core Contributor. To facilitate future growth and engagement within the devDAO, a tiered role structure is used.
An individual that prepares tickets and handles project management for community-driven initiatives. This individual works directly with Core Contributors as well as community members to create and manage tickets, assess pull requests, support the Kwenta development community, and communicate community needs to Core Contributors. The Kwenta devDAO PM will receive a compensation package managed by the adminDAO along with Core Contributor privileges. The devDAO PM will determine if a KIP or external audit is required for a ticket to reach the completed phase. Tickets that require a KIP will be determined by whether they are cosmetic or product-level changes. Tickets that require external audits will be managed in collaboration with Core Contributors and the DAO will be responsible for covering audit costs. The devDAO PM can reserve tickets for individuals if they are confident that the developer can execute on the ticket.
Any Kwenta community member interested in the devDAO, who has not yet solved a ticket. devDAO community members are encouraged to set up their dev environment, participate in discussions and ask relevant questions in the respective channels. The devDAO community members have priority when claiming tickets labeled easy/good first time issue.
Individuals that take on entry-level tickets. After solving the first ticket, devDAO community members earn the Bounty Hunter role. Community members with this role have access to easy to intermediate level tickets. Bounty Hunters assist with the onboarding of new devDAO community members and help out fellow community members with their tickets, if necessary. Bounty Hunters have priority when claiming tickets labeled Bounty Hunter, and can claim tier 0 tickets if no devDAO community members steps forward. Bounty Hunters completing at least 5 devDAO tickets (min. 2 intermediate) are eligible for progression to the community dev role. Role promotions are subject to the discretion of the devDAO PM.
Vetted individuals that routinely take on intermediate to advanced tickets. These individuals are eligible for recurring compensation in addition to ticket bounty rewards, adding an element of security to their position. Recurring compensation will be issued by the adminDAO in the form of sUSD. As trusted individuals who have proven that they can deliver quality work, higher-level tickets will be reserved for them along with higher tiers of rewards. Once eligible, a Bounty Hunter rises to the ranks of a community dev. In addition to Bounty Hunter perks, Community Devs have priority when claiming tickets labeled 'Community Dev', and can claim tier 0 and tier 1 tickets if no Bounty Hunter or devDAO community member steps forward. Tickets reserved for community devs in general are of intermediate to hard difficulty; or eligible roadmap-level tickets, which require some more commitment and dedication to the devDAO. Community Devs who are up for more complex tickets might be eligible to a monthly retainer, which can come paid out either through a recurring distribution or added to appropriate tickets bounties. Retainers and a potential progression to Kwenta Core Developer status will be assessed based on a community dev's history of completed tickets.
Kwenta Core Developers are Core Contributors who engage full-time with the task of developing Kwenta. Kwenta Core Developers concentrate their work on roadmap-level tickets and features. They also function as auditors for devDAO tickets. Kwenta Core Developers will receive a full grants package administered by the adminDAO.
An Auditor will review code prior to it being merged to ensure there are no bugs and that the code meets Kwenta community standards. Rewards for auditors will be determined by the Kwenta devDAO PM on a case-by-case basis. Auditors can be trusted community members given the role by the devDAO PM, Kwenta Community Devs that were not responsible for writing the code being audited, or Core Contributors. For a ticket to pass the auditing phase, both a community auditor and Core Contributor must have audited and approved the code.
Rewards are issued in the form of Kwenta inflationary rewards which vest over a period of one year but can be staked while vesting to capture more rewards as well any fees/bonuses available. Compensation structure (These values are approximate, rewards are ultimately determined by Community PM and adminDAO):
- Entry-level tickets - 0.25-3 KWENTA
- Intermediate-level tickets - 3-10 KWENTA
- Advanced-level tickets - 10+ KWENTA
- Recurring compensation packages - 1k-16k sUSD/month + packages can include locked KWENTA for long-term engagements
- Custom tickets: the devDAO retains the right to use any tokens and package structures it feels effective for the development of the protocol
KWENTA will be issued with a 1 year lock-up period unless otherwise specified.
The marketingDAO is managed by a marketingDAO PM which will work with other branches of the DAO to achieve growth through marketing initiatives.
The marketingDAO PM will operate in a full-time capacity for the DAO to coordinate with the community on campaigns, bounties related to marketing, and general growth efforts for Kwenta. The marketingDAO PM will not be directly responsible for growth but will instead be responsible for facilitating the marketing initiatives within the community. The marketingDAO PM will be appointed by the adminDAO. The adminDAO is responsible for managing compensation for this role.
The marketingDAO PM will coordinate with the community through an incentives system they deem suitable to execute on tactics. The adminDAO supports the marketingDAO with organization, funding, and execution. The adminDAO will analyze the performance of marketingDAO members and adjust talent as needed.
Product Elites maintain an active role within the ecosystem offering feedback and suggestions to improve Kwenta for compensation in the form of bounties.
Core Contributors will be tasked with designing a feedback loop within the Kwenta dApp and creating the necessary infrastructure with discord to facilitate open engagement. Establishing a path for active community members to be rewarded for their engagement.
Core Contributors will define bounties as feedback is ready to be processed where community members and Product Elites will have the opportunity to review product elements and critique them for compensation.
Tier 1 - Community members can post feedback in Discord where Core Contributors can review and ticket relevant action items. Tips may be awarded for useful commentary. Additionally, campaigns open to the general community will offer an opportunity to participate as well. If a community member has given feedback that has been implemented or provides feedback on a continuous basis, they can earn the Kwenta Product Elite role.
Tier 2 - Product Elites are community members that have earned access to feedback grants when they become available. Community members with this role will have access to more sensitive and targeted feedback grants for upcoming products. Product Elites will be able to claim grants labeled Product Elite.
The number of available feedback slots per grant and the grant value are dependent on the task being completed.
| Role | Amount | Frequency |
|---|---|---|
| Elite Council | 2500 USD in Kwenta | Monthly |
| President | 2500 USD in Kwenta | Monthly |
| treasuryDAO | 2500 USD in Kwenta | Monthly |
| Management Contributors | 1000 USD in Kwenta | Monthly |
| adminDAO | 1000 USD in Kwenta | Monthly |
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Core Contributors, devDAO PM and marketingDAO PM receive a negotiated grants package as well as a negotiated Kwenta package via the adminDAO.
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Variable Upside Bonuses for Core Contributors: The adminDAO works with the treasuryDAO to determine a bonus structure that can fuel additional drive for development and growth
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Milestones Bonuses: As milestones are reached on the roadmap, the Core Contributors will earn milestone bonuses. The treasuryDAO will determine a budget for each epoch's milestone bounties. The adminDAO will be tasked with distributing a completed milestones bonus to relevant contributors.
All KWENTA will be issued with a 1 year lock-up period unless otherwise specified.
The Grants Council is a three-seat organization funded with an allocation of $KWENTA tokens each epoch with the power to fund community members from this allocation, or from additional funds provided by the treasury, via a simple majority vote. The Grants Council is the primary mechanism by which community projects related to Kwenta DAO marketing or business development can be evaluated and funded.
Three community members will be selected via a popular vote by token holders. Kwenta DAO will distribute an NFT to the selected members to facilitate voting on grants and allocation of grant funds. Grants Council members are responsible for rewarding grants and allocating the Grant Council funds.
Elections
- A first Grants Council election should be completed in less than 30 days.
- To ensure high quality candidates, self-nominated candidates must be approved by at least 2 members of the Elite Council before candidates will be considered eligible.
- Grants Council Elections will have the same length of voting period, have the same eligible voters, and use the same voting system as Elite Council elections.
- Number of seats will be 3, and these 3 seats will be filled by the top 3 candidates in the election.
- The first Grants Council epoch will end simultaneously with the first token holder elected Elite Council epoch, and epochs and elections will continue to run on a schedule simultaneously with Elite Council moving forward.
- The first Grants Council epoch will have an evaluation period during the final 30 days of the epoch. In this evaluation period, the Grants Council will present its progress to the Elite Council and the community. Elite Council must confirm by majority vote that the Grants Council should continue to the next epoch, otherwise the Grants Council is dissolved and discontinued following the first epoch.
Responsibilities
- Draft and propose a Grants Council self mandate detailing the ongoing rights and responsibilities of Grants Council moving forward.
- Propose and request an ongoing funding source. Work with the appropriate governing body to secure this funding, e.g., the Treasury Council to secure regular funding from the Treasury.
- Propose and implement a system for managing funds and making payments to grant recipients, such as a Gnosis safe or similar infrastructure.
- Propose and implement a system for grant applications, a bounty board, terms for retroactive distributions, or other infrastructure enabling the community to interact with the Grants Council.
- Establish criteria for evaluating grant proposals, awarding grants or bounties for completed projects, and managing disputes.
- Establish regular meetings or communication channels with core contributors to assess Kwenta’s needs and ensure Grants Council is aware of the immediate needs of the Kwenta DAO and working in harmony with contributors.
- Provide funding, high level management, and evaluate projects completed by community members.
- Coordinate with DevDAO to propose tickets which contribute to GrantsDAO projects, or synchronize MarketingDAO efforts with the Kwenta exchange.
- The first Grants Council should demonstrate their effectiveness by managing the implementation of two specific projects described in this proposal, or by recommending and implementing alternative projects.
First Grants Council Projects
The first Grants Council will immediately begin planning and managing the implementation of 2 specific projects, which will be the primary measure of Grants Council effectiveness during the evaluation period. Grants Council activities should not be limited to these projects, but should make evaluating the feasibility of these projects and presenting their progress to the community a priority.
- Community Growth Project: Grants Council will expand use of the Kwentize PFP modifier throughout Discord and Twitter, improving its design, implementation, and connection to the Kwenta product. This project should help improve brand recognition, word of mouth growth, bolster social media activity, and help retain users in social media channels and on the product itself. Grants Council will develop KPIs to measure success when possible.
- Platform usage incentive project: Grants Council will oversee the design and implementation of a trading competition, or series of trading competitions. This project should directly encourage participants in the trading competition to make more frequent trades, reach higher volume targets, and trade a wider variety of assets. Grants Council will develop KPIs to measure the success of trading competitions under their management. This project should specifically demonstrate Grants Council's ability to coordinate closely with CCs and governance.
Grant Approval
- Elected Grants Council members will be issued an NFT from the AdminDAO allowing them to vote on grant proposals for the epoch following each election.
- Grants will be approved if at least 2 Grants Council members vote in favor of funding a specified grant, and must be funded by the end of the epoch they are approved. Grants not funded by the end of a council epoch require a new vote in the subsequent epoch.
- For the first Grants Council epoch only, the MarketingDAO PM may choose to replace the vote of a single council member. This mechanism allows the MarketingDAO PM to influence the outcome of votes only in situations where a unanimous decision is not reached by the Grants Council.
One-time funding
- Grants Council will be funded with 2,000 SNX. The source of this funding should first come from the existing MarketingDAO budget. Any additional SNX needed to make a sum of 2,000 should be provided by AdminDAO.
- A sum of 500 $KWENTA should be earmarked for Grants Council. This $KWENTA will be taken from the 15% of inflation currently earmarked for future trading incentive use. Treasury will distribute this $KWENTA as locked $KWENTA at the direction and discretion of the Grants Council during the first epoch. Any $KWENTA remaining unused at the end of the epoch may be clawed back by the treasury.
- This funding will only be allocated for the first Grants Council epoch. Any additional funding or funding for subsequent epochs will require a new proposal.
Compensation
- Grants Council will be a compensated role. Compensation will be equal to the compensation of the Elite Council in KIP-37, currently set to $2,500 per month in locked $KWENTA.
Council Member Removal and Mandate Enforcement
- Following the formation of internal mandates and guidelines, Grants Council may request the removal and replacement of a single member with a simple majority vote. If successful, the Elite Council may confirm the decision with a simple majority vote. If both votes are successful, a replacement may be appointed by Elite Council for the remainder of the epoch using a majority vote.
- Elite Council may entirely dissolve a sitting Grants Council and trigger a special election by achieving the metagovernance threshold of votes. Unless other terms are specified through metagovernance, a 1 week nomination period and 1 week special election would immediately follow a successful dissolution vote.
- A Grants Council term triggered by a special election will be up for re-election on one of the next two regularly scheduled election dates. If 90 or more days are left in the term, re-election will happen during the next scheduled election. If less than days exist in the term, Grants Council re-election will happen during the second regularly scheduled election date.
Although the 7 specified responsibilities of incoming Grants Council members should be sufficient to communicate expectations and purpose, the specific approach to implementation is left to the incoming Grants Council to establish that the body itself should be self governing and independent in its day to day activities. The necessary framework including a broad statement of purpose, expectations, and a voting framework enabling Grants Council to make internal decisions is provided in order to ensure Grants Council is empowered to begin this task immediately.
Council member removal and council dissolution ensure a framework exists both for internal oversight, as well as emergency oversight leveraging the Elite Council. This should provide a clear response for issues with the Grants Council without taking unnecessary time developing the framework retroactively, ensuring Grants Council functioning can efficiently resume.
Specified Projects
The inclusion of specific projects in this KIP helps clarify the Grants Council mandate and introduces real world examples of Grants Council responsibilities, demonstrating that the role is meant to be actively planning MarketingDAO activities, and not limited to passively funding grant proposals. There will be no "paid to vote" role. Grants Council nominees and voters can better understand the appropriate candidate for the role.
These specific projects also maximize the chance of Grants Council success, and give the community and Elite Council clear expectations and criteria by which to evaluate the contributions Grants Council makes during the epoch. Although ultimately Grants Council should be independently responsible for developing their own mandates, these projects provide a framework for that discussion.
One Time Funding
A one time allocation of funds to the Grants Council allows the Grants Council to begin working immediately with a reasonable budget, while still requiring that Grants Council independently develop a plan for ongoing or future expenses.
Temporary Oversight and Abridged First Epoch
The first epoch of Grants Council will include temporary specifications ensuring a degree of oversight from the MarketingDAO PM, and an abridged length for the first epoch. The purpose of these provisions is to maximize community participation while ensuring alignment.
MarketingDAO PM voting rights are meant to be used as an emergency measure, and should be avoided By granting special voting powers to the MarketingDAO PM in the first epoch, a protective mechanism against governance attacks or absent council members can be exercised without the need for existing core contributors to hold a seat on the council, as is often mandated by other DAOs with similar bodies. Making this mechanism temporary ensures that its necessity and effectiveness is discussed after the first epoch so that the KwentaDAO continues to further decentralize and empower the community.
An abridged epoch for the first council ensures that the terms of Grants Council’s establishment can be decided by a token holder elected body, since Grants Council could be established after the first election, but moving forward should align with Elite Council elections.
Implementation will require NFTs representing voting power to be minted and issued by AdminDAO, and require that Snapshot be set up to record Grants Council votes. All other infrastructure will be specified by Grants Council in subsequent governance proposals.
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