[RFC] Renewing the Community Multisig

[PGov]

Authors

@cylon, @PGov (CGWG)

Summary

This proposal extends the initial Formalizing the Community Multisig proposal that was approved for 6 months earlier in April 2025, until the end of 2026 (15 months between October 2025 to December 2026).

The initial proposed vote detailed an improved community multisig process and documentation. A robust and detailed process was created to professionalise the community multisig to meet industry level security and opsec standards. This process improves transparency and clarity for the Multisig and ensures all signers are active.

Background

At Compound, the community multisig was initially created to:

• Pause the Compound protocol in case of emergency
• Whitelist accounts for submitting governance proposals that did not require a COMP threshold to be met
• Set borrow caps (Compound V2 only)

The power of the community multisig was recently modified to also include cancelling malicious proposals as well following the passage of Proposal 303 to add a Proposal Guardian. This power must be periodically renewed by governance. We propose proactively extending the proposal guardian for 1 additional year.

Over the years, the process for onboarding and operational procedures for this very important multisig have been undefined. In the first trial period, the multisig signers have internally doxxed themselves and worked together to set some ground rules for the responsibility.

The current multisig signers and members can be found here: Forums

Improvements

With the passing and onboarding of the recent security provider for the DAO, ChainSecurity & Certora’s approved mandate now cover the scope of the quality engineer role, previously held by the DefiSafety team.

The DefiSafety team was incredibly helpful in first formalizing the multisig and has maintained these documents for the DAO to keep track of:

• History Document for the multisig
• Detailed Activities Document showing all transactions and signers, documenting its management process. This includes what the Multisig is capable of, who the signers are, what their responsibilities are, and their proof of humanity. It includes how the signers will communicate when an issue has been raised. It describes the regular testing and how the resulting executed transactions are documented. This includes periodic test “fire drills” each quarter.
• Shorter summary document highlighting main points

With DefiSafety’s role as the quality engineer now under ChainSecurity & Certora’s mandate, the CGWG will work with the team to transition any documents over and maintain continued updates and support. Further, the DefiSafety is encouraged and expected to apply for a grant from the Compound Grants Program to facilitate help as needed.

Additionally, the Proposal Guardian has recently been extended for 1 year in a prior governance vote.

Proposal

As part of the transition in Security Service Provider, we have added signers ChainSecurity & Certora onto the multsig. These new signers have elected to forfeit their stipends as part of their Security Service Partnership with Compound.

After consultation with the Foundation and discussion with current multisig members, signer membership was recently reevaluated to keep the current signer set composed of active community members. This includes removing TennisBowling and BLCK, and adding Michael as an additional independent signer.

Additionally, as mentioned above, with the transition of the quality engineer role to ChainSecurity and Certora, the original funding here will no longer be needed. The CGWG will oversee transitioning documents, and will coordinate with respective teams as needed.

Budget

This budget will account for 15 months, from October 2025 until the end of 2026. We propose:

• Multisig Signers (7): $1.5k/month/signer => $157.5k (ChainSecurity & Certora have forfeited their stipends)
• Quality Engineer: $0 (included in recent SSP RFP Mandate for ChainSecurity & Certora; CGWG will facilitate document updates)

Total: $157.5k

Similar to the prior vote, the funds will be sent to the CGWG who will be tasked with paying the multisig signers, including setting up streams and maintaining documentation and updates with DefiSafety. We have used a price of $29.75/Comp, resulting in $157,500/$29.75 = 5294 COMP. Given the extended duration of the program, we are requesting a 10% buffer in COMP, bringing the request to 5823 COMP.

Edit: This proposal has been resubmitted amid governance delegation changes, and to reprice for substantial price movements, as well as align the voting period.

The vote has been posted: Here

[PGov]

We will look to repost this proposal in the upcoming few days. The budget has been updated to reprice for $COMP price and to extend for ~1 year until the end of 2026.

Vote live: Here

[pennblockchain]

Following passage of Delegate Race 2 and imminent passage of the Community Multisig Renewal, we want to express our concerns about Compound’s long-term trajectory. We are not financially dependent on the outcome of our delegation, and the members of our committee are volunteers and unpaid for their opinions. Unlike other service providers, FranklinDAO has no incentive for Compound to continue limping along in slow decline. Therefore, we are uniquely positioned to objectively speak to the state of Compound’s affairs.

FranklinDAO fully acknowledges the success of Delegate Race 2 and agrees that the delegates involved in its passage have performed a great service to Compound as a whole. However, we question the effectiveness of Compound Governance. The Golden Boys governance threat has been known for at least 16 months. Five proposals have been unilaterally defeated by Humpy and his associates since Proposal 289 before the GWG has taken any action. In our opinion, this is a serious failure.

While it is every delegate’s responsibility to address governance threats, the GWG was paid $280,000 last year with a mandate of maintaining the effectiveness of Compound Governance. As such, we should expect more from the GWG due to their clear incentives.

In the November 2024 renewal of the GWG, the group made the promise to boost both “the quality and quantity of delegate participation,” with the first order of business being to “develop and launch a campaign to encourage delegation and increase participation for current and new delegates.” Serious questions must be asked of the GWG as to why it took a full year from the declaration of this mandate to propose Delegate Race 2, a very straightforward action that ultimately required just one additional entity to get involved for the proposal to pass. Even the increase of voting participation, which was a point of success for the GWG in 2024, proved to be temporary. Compound’s voting participation was less than 20.1% until shortly before the re-run of Delegate Race 2. These participation levels are lower than that during July 2024 when Proposal 289 was passed.

Now, with Delegate Race 2 passed, governance should be relatively stable going forward. But we still have concerns for the future. Compound is far behind its competitors – years of complacency and maintaining the status quo have resulted in the protocol consistently losing market share to Aave. FranklinDAO struggles to see how any of the proposals initiated by Compound Governance have brought the protocol closer to regaining relevance in the market.

For example, Compound Governance delegates widely regarded the Chainlink SVR deal as a resounding success because of the better terms negotiated with Chainlink. This ignores the reality that negotiating better terms on technical maintenance does not differentiate Compound from competitors. Nor does it attract new users or help Compound increase its market share. Even on the technical front, Compound is simply following behind Aave.

More broadly, Compound Governance has become adept at framing proposals that maintain the status quo as triumphs. The creation of the Compound Foundation was the only significant attempt at change, yet it still hasn’t delivered results. As said by the Foundation, Aave has “grown their deposits to ~16x that of Compound through rapid feature development, aggressive expansion, and dedicated ecosystem support.” Foundation has yet to produce any similar initiatives five months after its creation. We acknowledge that these things take time, but the window of opportunity for Compound to reverse its current trajectory is closing.

The only entities benefitting from the current state of Compound are the service providers and governance contractors, who preach urgency while only delivering incremental improvements and maintenance. The best thing for tokenholders right now is for Compound to take bold action. The protocol is sitting on over $100M in undeployed assets – either these need to be invested in technology and new services to help Compound compete for market share or distributed out to tokenholders. Allowing them to sit idle is doing a disservice to all stakeholders.

There is a clear leadership vacuum. So far, the lack of communication and updates from the Foundation has only exacerbated the uncertainty around Compound’s direction. We urge the Foundation to be more transparent about what their vision is for the future of Compound and better outline what steps they are currently taking to get there.

[Jorstack]

(post deleted by author)

[Compound_Foundation]

The Foundation would like to thank FranklinDAO for taking the time to offer feedback and for their governance engagement over the last few years.

In large measure, this is a fair assessment of Compound’s current market position, especially when it comes to the state of governance and the need for an imminent bold move. From the moment the Foundation was formed, it was clear that Compound faced a substantial set of challenges—but our team rose to meet them. Thanks to the dedicated hours, nights, and weekends of a passionate group of contributors, our governance affairs are now on a stronger and steadily improving path. Alongside the time-intensive tasks of building a new organization and strategically addressing our technical and legal debt, this has positioned us for meaningful, long-term success.

Those who have been following our progress may actually feel we have surpassed our initial OKRs. We have made significant progress in areas such as improved financials, product roadmap (including the announced staking build), and more effectively aligning key Compound stakeholders. As originally communicated in June, the Foundation intends to provide a transparency report by yearend. We have also announced we will release a detailed product roadmap with our vision on how to stage a successful comeback that aims to not only catapult Compound’s market share, but also help recapture our brand sentiment as a trusted and innovative DeFi pioneer.

In terms of FranklinDAO’s notes on communication, we’d like to respectfully suggest this is a two-way street. The Foundation posts on the Forum, hosts community calls, and runs dedicated Slack channels with delegates and vendors (including one with FranklinDAO, though we unfortunately haven’t seen traction there recently). We are keen to engage and listen to suggestions and perspectives, and will often do so proactively. We strongly encourage the new members of FranklinDAO to leverage these opportunities going forward to maintain an ongoing two-way dialogue.

The nature of innovating in a bleeding edge tech segment such as DeFi warrants certain matters to only be discussed in an appropriate—often private—setting due to confidentiality, legal aspects, governance sensibilities, and competitive positioning considerations. Fully addressing such matters over the Forum could be doing Compound a disservice, and we have therefore erred on the side of sharing information responsibly. For example, we kept certain commercial terms private while audit vendors got comfortable with our RFP process, thereby attracting 45 bids on audits services, and saving the Compound DAO 50% in fees.

The Foundation welcomes continued discussion and will keep contributing where it can add stability, clarity, and forward momentum. We look forward to sharing more details—especially on our product strategy to grow Compound’s market share—later this month.

[Jorstack]

I get what you are saying and some of it is fair, but I also want to be honest about how things still look from the outside. Governance is not in a great place and the $COMP supply in the treasury keeps going down with no real plan to build anything back up. Staking was one of the first things that actually made sense for the token and I thought that was a good utility add for token holders. That being said it is hard for people to feel confident though when the protocol does not invest in its own token and spends what little it has left. I have left feedback on a few posts to show how this can happen without spending fund like using the yield strategy to buy token back. But also limiting spending comp tokens.

The communication issue is also hard to ignore. There were simple ways to stay active on socials without trying to fight for the old Labs account or in the meantime. Creating a new account for the Foundation would have helped a lot. The GrowCompound account showed how you can still have presence without the labs account and biweekly calls are not enough on their own.

I also agree about basics being over celebrated as large wins. They are important, but they do not really change how people feel about the direction of the protocol. When the Foundation came in, the hope was that things would feel different and more transparent and that Compound would start to feel like “OG” Compound again. I do see progress compared to some other places, but it still feels like there is a gap in communication and a gap in confidence.

Just for context, I do not hold COMP anymore and I am not connected to anyone here. I held it in the past and felt the direction was on the right way then. I am only saying this because I want the protocol to do well. People need to see real momentum and a sense that the long term growth of the protocol and the token really matters.

[Compound_Foundation]

Thanks for your feedback Jorstack and appreciate your thoughts and ideas. We are executing against the below topics, and will continue on updating via the channels mentioned, to the extent possible. If you’d like to discuss those in greater detail, please feel free to join the community calls — there’s one next week — or feel free to reach out to the Foundation - I believe we have already established a direct line of communication over the summer.