Recently, Silvio Micali proposed a new governance model for further decentralizing the Algorand’s Governance, So to clear all doubts from the community team has arranged an Live Discussion on 16th December which was held on Discord channel.
In this article I arranged “key insights from the live discussion” which can help you if you haven’t joined the discussion or you still have some doubts left about the new Governance model. I have restructured some questions which can be easy to understand by everyone. Hope this article will help you.
Question:-What makes the Algorand team to consider a governance model in the first place?
Answer by Sean lee:-Progressing on the path to decentralization has always been the goal for Algorand. We've spent much time setting the foundational pillars in building ecosystem programs, and we want to further solidify how we broaden direct engagement from the community. We love these constructive feedbacks!
Question:- What is the process for getting involved in governance (registration, KYC, US citizens?)
Answer by Keli Callaghan:-At this point, it is too early to pin down the exact requirements, but we will be working to ensure compliance with all existing regulations when requirements are established.
Question:- What will the minimum time length be for a stake?
Answer by Massimo Morini :-That's going to be decided by the market. Yet, governance is a longer term commitment, so I guess the minimum locking time possible will be more than one month.
Question:- If you don't elect to govern will you still get participation rewards or will they be completely phased out right away? & which reward is going to high??
Answer by Massimo Morini:-In the long term, there will only be governance rewards. In the transition period participation and governance rewards may coexist but governance rewards will always be higher.
Question:-In future can we see governance feature in the algorand wallet ??
Answer by Paul Riegle:-the governance features could definitely be represented in wallets
Question by CEO of AIKON - we've received a grant from the Foundation and the team was incredibly professional and the due diligence was very strong. I feel like it would be much harder to deliver the same quality of vetting from decentralized governance, and I'm wondering if you're considering having ALGO stakers vote on the leadership of the foundation, rather than the individual grants.
Answer by Sean Lee:- Hey Marc, good to connect again. Our focus is to further involve the community in our grant process while continuing to maintain the high level of due diligence. We will further expand the scope of the governance across other aspects of the protocol. Thank you for your input!
Question:-Is this governance feature a service that could be separately used for other projects and ASAs?
Answer Paul Riegle:- The proposal would include some layer 1 implementation but I believe it would be able to be recreated in smart contracts if others would like to follow the model. to be fair, that would become more clear during technical design and implementation
Question:-Will this governance be baked into the protocol or will it be a smart contract built with Teal?
Answer by Paul Riegle:-probably a mix of both, but hard to say until we have a solid proposal with feedback from the community
Question :- How will the new Governance model handle dominating Algorand holders if they choose personal interests over communities ??
Answer by Steve kokinos:- Silvio Micali in his proposal cleared that proof-of-stake is a philosophy that people who have more to lose are more inclined to make good long term decisions for the entire project. People with more stake have more to lose for poor decision making. This isn't about participants acting in a self serving manner, but about getting deeper engagement from those who have a stake and know the ecosystem as it stands today… and have more to lose.
Talking about grants right now, decisions on grants are taken on by the foundation - so this proposal is an improvement! This is the time to propose better ideas -- just as Silvio has done with his proposal.
Question:- What about early investors/backers who have 33% of the pool, what if this new proposal shifts the control from foundation to early investors/backers ??
Answer by Keli Callaghan:- The early investors/backers are a collection of over 50+ different organisations and individuals who do not act as a single entity. They are a very disparate group of actors, who have different approaches to the Algorand project and their investment or support of the project. Some hold the Algo they earn, many sell their Algo on a regular basis. There are still Algos left to distribute to them and the time frame for the distribution of these Algo now stretches to 2024 (this was extended, if you may recall).
These Early Backers would not be automatically added to any of the governance reward programs. The long term lock-up requirement proposed as part of this governance approach may preclude many of this grouping from participation.
Looking at Consensus, the VRF utilising Pure Proof of Stake Consensus mechanism ensures that this form of grouping cannot impact block consensus security. Since the block committees are chosen entirely at random and are not pre-informed, the security of the block remains robust.
Question: How will we fight voting apathy (or lack of general public understanding of all the possible grants and long term strategy).
Answer by Steve kokinos :- We would like to push back on the notion of apathy. We really are confident in our fellow travelers. Everyone brings a new perspective and will want to have it heard. The very notion of representation presupposes that people do not want to take charge of their own actions and interests personally. Algorand has thought very much about how to lower the bar to participation so that everyone can participate. We don’t yet have data of how much participation will occur in governance, but
(a) we should be optimistic &
(b) it will be more that the Foundation alone --which is the case right now!
QUESTION: Can Pay to Vote be an effective universal motivation mechanism or will it only engage active hobbyists and large investors with teams??
Answer by Keli Callaghan:- Nobody is selling votes here. From many perspectives. First, rewards are for locking, not for how you vote. Once you have long-term skin in the game with your locked Algos, you will earn your rewards no matter how you vote! We trust that you will vote for the best proposals once you vote. And if you vote in a way that is different than ours, you may see things we have not paid attention to. This is why governance should be in multiple committed hands. No votes are unrewarded. All votes count.
Question:- Will exchanges support the governance feature??
Answer by Keli Callaghan:- Governance is a kind of feature which requires locking period and requires unique keys to take part into the governance system. Ideally people take their tokens to exchange when they want to trade it or when they’re willing to trade. But it’s possible that exchanges will find a way to include governance features into their ecosystem.
Question:- what will be the timing of implementation of the new governance model ??
Answer by Keli Callaghan :- At this stage, this is just a proposal. We are actively listening to our community on feedback, concerns, and items to be ironed out. We look forward to refining this and launching when we can! In the meantime, we will keep the community up to speed and involved.
Few common themes from the discussion that might build into specific threads or workgroups:
1. Locking Period.
2. Voting Mechanisms
3. Tech Management of Projects
4. Rewards Difficulty -how will that work.
5. Can ASAs and 3rd party applications make use of the governance tools/mechanisms.
6. How can the community get involved in governance.