I believe I have shared here and there that our r&d team have been looking at L2 intensively. So this is not a proposal of picking between a new token upgrade and L2. We wanted to do both and are planning to do both if we get the community approval (via the DAO voting).
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So, in summary, Iām opposed to give away our awesome token economics to be replaced by inflation based strategies to grow liquidity by just giving high ROI to liquidity miners at expense of token holders. Iām opposed to inflation based funding at expense of token holders except for a 1 time event for L2 solutions research. That being said, letās see what others have to say.
I donāt even know if you guys really need funding, I havenāt even heard of any finance report from the the ICO money. You guys still have ETH left from the ICO? Never heard of any finance report from kyber team. How healthy are your finances?
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While I understand the point of giving incentives to network users and I totally support such initiatives. I am afraid this is introducing Keynesian debt mechanisms into this token economics.
I would accept it only if also KNC holders get an incentive for holding coins now inflated and if this KNC printing would be really regarded as an exception. If you discover how the printing machine works, you may wanna print more.
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Thereās a lot of people very concerned about the inflation suggestion, just for the record my initial reaction as a holder was concern too.
However itās been mentioned multiple times that an inflation event would only happen if the DAO agrees to it, which is going to require a strong argument, just like any project proposal in any businessā¦ it boils down to do you want to spend money to make money?
Eventually the Kyber team wonāt be responsible for the development or direction of the protocol, itāll be the DAOs responsibility, the inflation mechanism proposal is a suggestion of how to support growth in the future when the decisions and development is no longer centralized. Iām sure thereās multiple ways to achieve this, the inflation mechanism is just a proposal to this future problem.
Start treating being part of the DAO as running a business, if someone suggests a project to improve volume by 20% (and therefore earnings for the network) indefinitely, or how to reduce gas costs by 20% (attracting more users) weāre going to need some way as a DAO to fund or incentivize development. The same way a business puts out a development contract for tender. By not limiting the incentives to only KNC holders weāre able to reach a much larger market of resource/expertise.
Iāve gone from against the proposal, to on the fence, to wishing it was as easy as Iāve explained.
My biggest concern is massive votes coming from pools/delegators and exchanges (Binance), obviously theyāll want the value of KNC to increase for their users, but might have hidden agendas. The centralized power of their votes is what Iām most concerned about.
If there was a voting power limit (not earnings for stakers limit) Iād be more onboard with the inflation mechanism proposal. Without the safeguards weād be giving control of a KNC printer to a few centralized entities.
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No, please donāt. Vote on recommended projects and the percentage of profit from the network that should be awarded to them. Instead of 5% burning, make it 1% and award rest for development. No inflation - Kyberās sales pitch is burning and staking profit, true deflation - one day there will only be 1 KNC left - can you imagine its price? Donāt mess up what makes Kyber the best of the best!
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Iāve used KyberSwap many times for my trades and Iām very pleased with GUI and ease of use. Now Iām also staking KNC.
My suggestion is to make KNC voting power exponentially diminishing in relation to user KNC amount. Letās say 1000 KNC =1 vote; 2000 KNC=1,95 votes; 3000KNC=2,8 votes and so on.
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My suggestion is to make KNC voting power exponentially diminishing in relation to user KNC amount. Letās say 1000 KNC =1 vote; 2000 KNC=1,95 votes; 3000KNC=2,8 votes and so on.
No, way. This is NOT equality before the law (before the code), what you want is privileges. Bigger guys that invested in KNC should have the same right than small guys to decide, not less, not more, the same.
The privilege you want is to give is less voting right to the poor. Like if they had much to loose by doing bad decisions. Big guys have much more to loose so they are more incentivized to make rational decisions. Not that they are exempt from making bad decision, but they should and must be treaded equally before the code.
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Just how I see it right now. Binance staking pool holds 20M KNC token, they are determining most of the decisions. They are more or less our competitor. I donāt know who makes their voting or are they really supporting our community long term growth.
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That sounds great in theory but in reality Binance and other exchanges have enormous power over the project. And they could turn into malicious actors. It would be like Blockbuster controlling half the seats on the board of Netflix while it was still in its infancy
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This needs to be addressed.
Our competitor is controlling our fate!?
In that case just blacklist binance address so they cant vote. But lowering voting rights to big guys is giving privileges to the poor.
To prevent the manipulation, the current guidelines for Binance to vote are:
- vote on the last day
- vote for the option that has the highest % of consent
But still, itās a valid concern for DAO to prevent a few big holders to determine some critical decisions. We can come up with the general guideline for this case something like (just an idea) a number of addresses votes has more weight than the amount of KNC token votes in order for the proposal to pass. So If the second-highest option gets support from a 3 times higher number of unique addresses than the first one (in terms of staked amount), the DAO contract proceeds with the second option.
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Yes, to give more weight to number of addresses voted is good solution. I can support that.
We canāt take voting system too lightly. Iām quite sure that there are some bad actors who will misuse the system if we let them.
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Using unique addresses to determine vote weight has been discussed in many DAOs. And it always brings the problem of sibyl attacks.
On an anonymous decentralized ledger no one needs to vote with all his voting power on one, single address. A big holder (letās say Binance) could simply split his KNC to hundreds or thousands of addresses. That way he could even amplify his voting power, if unique addresses are a relevant factor.
Counting unique addresses just doesnāt work without some kind of safeguard. One common way to prevent holders from voting with multiple addresses is to to force KYC for voting addresses. But I strongly advice against that step for the Kyber DAO.
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Pools should implement some kind of internal voting for holders without gas fees. Whatever the holders choose, they have to vote the same.
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I run the Kyber Community Pool which is a staking pool where our entire ethos is to act and vote in the heart of the community.
Right now we donāt have a sort of feature where users can soft-vote on how they think the vote should go, however it is something in the pipeline. We want users that are delegating their voting power through our pool to still have a voice, and I think some sort of internal (gasless) voting or signaling mechanism would be super useful.
Iām running off topic but just want to add that I completely agree and itās something my pool will be working on adding!
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That would be very good. I would definitely move my bags to a pool that makes this somehow transparent.
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Counting unique addresses just doesnāt work without some kind of safeguard. One common way to prevent holders from voting with multiple addresses is to to force KYC for voting addresses. But I strongly advice against that step for the Kyber DAO.
By using a descentralized KYC protocol might be possible, donāt know if that exists yet in ethereum.
1 address 1 vote without KYC is NOT a good idea, big holders will simply split all their KNC into different addresses, EVEN with a descentralized KYC protocol is not a good idea either, IS NOT FAIR, is not equality before the law (code), that big holders that invested more money, now, unfairly, their vote count only as 1-vote-1-person independently of how many KNC they haveā¦ why? They have more to loose if they act irrationally, is in their best intentions and interest for the business to succeed.
The problem might be the exchanges like binance that hold KNC that is NOT theirs, but not genuine big hodlers that invested their money into it. The solution is only to blacklist all exchanges, from decision making, they can receive rewards, so they give those rewards to their costumers, but they should not be allowed to vote on decision making proposals. If an exchange changes or split the KNC into multiple addresses, is our job to identify those addresses and blacklist them. I donāt think exchanges will be splitting or changing KNC location to multiple addresses if that means losing staking rewards for their costumers, every time they do that, theyāll loose an ephoc reward since it requires maturation time of 15 days to receive the first rewards (we can even increase the maturation time for blacklisted addresses to 30 days). NOW, if we blacklist exchanges like binance, the requirement to vote to receive rewards has to be removed for blacklisted addresses, meaning they will be able to receive rewards without having to vote, but they will not participate in decision making.
I love how the conversation turned into LETāS FIX THE GOVERNANCE, when it was about INFLATION good or bad for KNC holders.
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Yeah itās probably a good idea we keep things on topic about the migration & upgrade at hand.
Topics discussing other unrelated governance improvements deserve their own topic for sure. 