I like the direction of @JacobPPhillips’ thinking around growth / biz dev strategies as untapped potential. That said, I also share the concerns raised about potentially incentivizing un/counterproductive behavior through governance mining. Compound is an innovator in on-chain governance, but I’m definitely not convinced that we’ve found the secret sauce that will make incentivized governance a seamlessly productive use of COMP.
Zooming out, there are currently three major ways for people and organizations to procure voting power in on-chain protocol governance:
(A) Earn COMP directly from the protocol
(i) Earn as a founding team member or early investor
(ii) Earn through liquidity mining
(iii) Earn through governance for an implemented protocol development or through the Compound Grants program
(B) Acquire COMP tokens through secondary markets
(i) Buy COMP on an exchange or via p2p trade
(ii) Borrow COMP through a lending service (CeFi or DeFi)
(iii) Receive COMP from someone as a gift (I’d lump Coinbase Earn in here)
(iv) Steal COMP (obviously this is terrible and not condoned, but to leave it out would be to ignore the very real problem we have with scammers, e.g. on our own Discord server)
(C) Others can delegate their COMP to you
In this thread we are exploring tuning and broadening category (A) in ways that benefit the safety, health, accessibility, and overall mission of the protocol. I’m framing it this way because I think it’s worth emphasizing that this discussion is focused on strategies for apportioning future governance rights that are currently under the full purview of governance.
I support all of the tweaks to (A)(ii) and (A)(iii) that have been discussed (e.g. compSpeed split, supersizing the grants program).
Regarding category (A)(i): the folks listed here were absolutely critical to the funding, development, and bootstrapping of the protocol, so it is fitting that they are entrusted with a significant role in protocol governance. Also critical to the bootstrapping stage was the community of early (pre-COMP) users, would-be stakeholders who were in most cases diluted to oblivion since COMP launch day by the deluge of capital that came to yield farm professionally. Early protocol users should hold a meaningful fraction of collective governance power: perhaps not the full 5% level initially floated by a16z, but at least 1% of collective governance power. What is the rationale for holding this number at 0%?
I also want to signal-boost @rleshner’s suggestion of rewarding on-chain activity in an asset proportionally to its effect on increasing protocol reserves in the relevant asset, with greater rewards for boosting reserves of assets in which the protocol is least well-capitalized. I can’t think of anything more clearly aligned with the goal of promoting protocol health and safety. And for those who envision governance eventually rallying around a periodic disbursement of reserves deemed “excess” to COMP holders, well, this idea could put the feasibility of such a concept on a faster track (fwiw, I would not support such a proposal for quite some time to come, if ever).
I would love to see this “COMP for contributing to protocol health via effects on reserves” idea explored further and ultimately formalized (ideally by someone with more of a risk management background than me!) so we could think about adding it to the RFPs.