Request for Input and Feedback: 0xDAO Grant Program

[nikita]

This post outlines a starting framework for a 0xDAO grant program. If approved, funding for the grant program will come from the 0xDAO community treasury. We are seeking constructive input and feedback from the community prior to submitting this proposal for a governance vote.

Summary

Drawing inspiration from other protocols, we propose to establish a pilot grant program to provide funding to projects, ideas, and events that benefit the 0x protocol and its stakeholders. If approved, funding for the program will come from the community treasury. Specific parameters and investment targets are TBD. Grant proposals will be evaluated and awarded using an investment mindset. An explicit goal of the program is to prioritize investments with the greatest potential for high-impact returns.

Purpose

The grant program will:

1. Develop and implement a structured process to efficiently ingest and evaluate grant proposals;
2. Actively track and report on the progress of funded grants;
3. Collaboratively assist with maximizing the impact of grant deliverables; and
4. Derive outcome and return on investment metrics to inform future investments.

Scope

Our intention is to fund projects, ideas, and events that directly benefit the 0x protocol and its stakeholders. We have loosely categorized the following focus areas and are interested in feedback as to prioritization (High, Medium, Low):

• Protocol features and improvements (NFT support and transformers, for example)
• Code audits (for external code integration)
• Tokenomics revamp/optimization
• Marketmaking
• Staking
• Developer/user tools (including documentation)
• Research and analytics
• Dapps and new integrations (especially projects using orderbooks)
• New business models and monetization paths (including new use cases for Mesh)
• Community building, outreach, and rewards
• General marketing
• Social media
• Hackathons

Operations Model

As representatives of the 0x community, the 0xDAO bootstrap delegates have sufficient delegated voting power to autonomously create on-chain, binding treasury proposals. However, they are not expected, nor are they empowered, to actively oversee project workflows and ancillary activities that are funded by the treasury.

Therefore, we seek input from our community regarding which operations model to implement to ensure that the grant program achieves its goals (as described in ‘Purpose’ and ‘Success Metrics’). The following models may be considered as candidates (we are open to other suggestions as well):

1. Community Managed: All funding and operational decisions require an on-chain community vote; program management is by consensus; operational coordination and pre/post-decision work is done on an ad hoc basis by community volunteers
2. Committee Managed (Synthetix model): A small committee (elected or appointed) is allocated a budget with discretionary, multisig spending authority and is responsible for running the program (committee may or may not be compensated)
3. Lead with Reviewers (Compound/Uniswap model): Program lead is ‘hired’ by the DAO and has some level of discretionary decision-making authority to run the program; also makes funding recommendations that require reviewer multisig approval (lead is compensated)

Process and Timeline

If approved, the program will begin shortly after the proposal passes and will run for a period of six months, at which time the program may be extended, expanded, replaced, or terminated by the community, depending on learnings and results. Additionally, if warranted, interim adjustments may be made prior to the end of the six-month period via the governance process. The program is expected to report progress, operational, and outcome metrics to the community on a regular basis (schedule TBD).

Budget

The community treasury is seed-funded by 0x Labs with 2m ZRX (~$4m as of 4/1/2021). We are seeking input as to the amount of funding to be allocated to the grant program for the six-month pilot. Any allocated funds not used will revert to the treasury.

Success Metrics

We expect success to come in two forms: objective and subjective.

Objective success metrics:

• Specific ROI metrics as described in ‘Purpose’
• Level and quality of community engagement
• Number and quality of grant applications (especially in ‘high priority’ areas)

Subjective success metrics:

• Improved sentiment and goodwill within the community and broader ecosystem
• Improvement in 0x’s brand and positioning in the market

Conclusion

The grant program will be a critical component of the initial portfolio of activities undertaken by 0xDAO through the community treasury. As an experimental pilot designed to deliver high-impact returns for 0x stakeholders, we intend to learn by doing and will be transparent about what we do well and what we can do better.

Please share your thoughts and suggestions in the thread below. Additionally, please register your general support and preference in the following polls:

Poll: Support for Grant Program

• Support
• Do Not Support

Poll: Operations Model Preference

(see descriptions and examples, above)

• Community Managed
• Committee Managed
• Lead with Reviewers

[0x-cloud]

hi, very interesting post, I completely support this approach for the grant program.

Regarding the prioritization, following is my opinion, though some entries are not completely clear to me, like what can be done/improved/developed around “staking”.

High:

• Tokenomics revamp/optimization
• New business models and monetization paths (including new use cases for Mesh)
• Protocol features and improvements (NFT support and transformers, for example)
• General marketing

Medium:

• Developer/user tools (including documentation)
• Code audits (for external code integration)
• Dapps and new integrations (especially projects using orderbooks)
• Community building, outreach, and rewards
• Staking

Low:

• Hackathons
• Marketmaking
• Social media
• Research and analytics

[nikita]

Thank you for taking the time to think though and share your prioritization feedback @0x-cloud!

Separately, because the operations model sentiment so far is trending towards a community-managed model, I am keenly interested in getting specific input from the community on how such a model would functionally operate on a day-to-day basis, given the program scope and the objectives laid out in ‘Purpose.’

For example, an efficient and effective program might include any or all of the following operational activities (not intended to be a comprehensive list):

• General administration
• Marketing
• Proposal evaluation and due diligence
• Cost comparison estimates and negotiation
• Active progress monitoring and assistance
• Ongoing coordination with other stakeholders
• Technical and functional reviews
• Quality control
• Cross-project/protocol pollination
• ROI analysis and documentation
• Reporting

Hoping to get some detailed input on how these types of activities (or others I might have missed) would be managed and get done in a community-manged model where operational decision-making is done via on-chain voting, along with any examples of where it is currently being done successfully for inspiration, best practices, and lessons learned.

[0x-cloud]

regarding the “operations model”, personally I’m in favor of a “Committee Managed” or, in alternative, a “Lead with Reviewers” model.
With the “Community managed” model, in my opinion, would infact be very hard/impossible to find an efficient way of performing all the necessary activities.

[mintcloud]

I agree, I think a committee model gives more agency to the whole program and I voted for that.

For what is worth, both Uniswap and Compound’s grants programs work in this way, and were voted by the community

• Uniswap grants program
• Compound grants program

Both programs have a lead model. Lead/Committee are pretty similar imo. Personally, I don’t have a strong feeling on one vs the others, but I feel the lead model could be more effective, while puting the lead in a more challenging position.

[nikita]

Thanks @mintcloud. Maybe it is semantics, but I classified Uniswap and Compound in the ‘lead with reviewers’ model, but like you said, the two models are similar. Specifically with Synthetix (‘committee’ model) there is no lead, only a committee, so maybe that is a good way to distinguish them.

[JoaoCampos89]

I believe we need at least a paid accountable person or committee to oversea all grant programs or propose grants based on ideas raised by the community, this is to much work to be done by volunteers, that’s why I voted for the “Lead with Reviewers”. The bootstrap delegates could help on review proposals from the Lead or support it, or even start build a scope of a proposal to be completed by the lead and then reviewed again by the bootstrap delegators, this way we can have a specialized person or persons with a framework on mind to the 0xDAO be more productive.

[SonofPegasus]

I went back and forth between ‘committee’ and ‘lead,’ but ultimately voted ‘lead with reviewers’ since I believe that’ll be the more effective way to get the grants program off the ground in the short term. Absolutely open to ensuring the “lead” is appropriately compensated for his or her work, but maybe we can limit the first term to a defined period (six months?) and then the community can revisit the model then.