Formalizing the Comp Staker Process
Authors: Compound Governance Working Group (CGWG)
Recent months have underscored that the DAO must align its efforts to avoid splintering into disjointed initiatives. Nowhere is this more critical than with Staked COMP, a decision that would significantly impact Compound’s governance and economic future. Over the past few weeks, teams like AlphaGrowth and Gauntlet have proposed distinct visions for stCOMP—each compelling, yet divergent. Without coordination, we risk conflicting proposals and wasted momentum. The CGWG is stepping up to bridge this gap, proposing a structured process to define stCOMP’s future. Instead of letting individual vendors drive separate, clashing votes, we’re launching a Request for Proposal (RFP) process, enabling the DAO to systematically debate and adopt a robust stCOMP framework in the next couple of weeks. Ideally, with this RFP, we will invite various developers and researchers to contribute solutions, allowing the DAO to evaluate multiple options clearly.
The CGWG will orchestrate a framework, calling for detailed proposals that address three core pillars:
- Technical Design: Audited smart contracts, fluid lockup & redemption mechanics, stCOMP implementation that runs seamlessly, proposition for claiming fees, etc. It’s important to consider which parts of the system will be immutable versus adjustable via onchain vote.
- Economic Incentives: A thought out fee distribution model (e.g., from protocol reserves), rewarding both small and large stakers without distorting power dynamics. Make clear if additional complexities like time-weighted rewards or a ve model are to be used. The backend fee processing for this should be fleshed out and disclose how much of a treasury management uplift may also be required.
- Governance Integration: A system that enhances Compound DAO’s engagement—boosting participation and decentralization by both delegates and delegators—and granting voters the ability to decide on effective reward distribution.
Here’s a prospective timeline. Note this is subject to change pending finalization of each proposal and community discussion:
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RFP Launch (April/May 2025): We’ll look to launch the full RFP within two weeks, inviting proposals from all interested teams—AlphaGrowth, Gauntlet, and anyone else—to be submitted by mid-May This gives ample time for robust submissions addressing technical, economic, and governance needs. Additionally, this allows for teams to flesh out their mechanism design and proposal more so.
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Temperature Check (late May 2025): Post-submissions, we’ll hold an off-chain temperature check vote to gauge sentiment and narrow focus to the most promising stCOMP proposals. This step ensures we channel resources efficiently, guided by the DAO’s voice.
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Onchain Vote and Budget (X 2025): With a refined proposal selected, we’ll move to an onchain vote to greenlight implementation and fund the elected solution. The RFP will request each team to propose a budget, covering development, audits, etc. Implementation could begin by Q3 2025, pending vote success and a few other factors such as setting up appropriate legal entities for the DAO.
While Staked COMP focuses on the governance and economic design, there are associated legal implications with such a setup. It is likely that Compound DAO will need to first adopt an entity like Wyoming’s Decentralized Unincorporated Nonprofit Association (DUNA)—a topic that is also being discussed at DAOs like Uniswap, which is concurrently discussing their version of the Staker setup. This RFP should be able to run while we observe how the legal entity is adopted by Uniswap as well as the impact Unistaker has on Uniswap DAO. It is worthwhile for Compound DAO to utilize a second mover advantage with Staked COMP and perhaps the DUNA. Legal entity exploration is not in the scope of this RFP, but we will adapt the timelines as necessary to accommodate legal counsel’s opinions and support.