eIP 56: End Current DAO Expenses While Protocol is Non-Operational

Title: [RFC]: End Current DAO Expenses While Protocol is Non-Operational
Author: @Matt_StableLab
Related Discussions: eGP 7, eGP 8, eGP 9, Encode
Submission Date: May 9th, 2023

Simple Summary:

The DAO should reevaluate its service agreements and commitments made before the hack as they may no longer provide value during this time of rebuilding.

Abstract:

Prior to the hack, Euler DAO had commitments with 4 service providers. As the protocol is not currently operational and we are unsure what the new version of Euler will look like, it does not make sense for the DAO to continue funding these grants. The DAO is now in a far different state than when these agreements were initially made. As such, we should revisit their benefit to the DAO. Ending these agreements would also allow these service providers the ability to propose new initiatives that could benefit Euler V2.

Motivation:

Even though the Euler Protocol is not currently operational, the DAO is still spending money on tools, analysis, and grant programs. At present, these services are not needed and/or not possible due to the protocol being off. The DAO should consider ending these agreements. Stopping these grants would also allow the service providers to revamp their proposals to become better aligned to serve Euler V2.

Below is a breakdown of the DAO costs that should be re-evaluated.

eGP 6: Grant Request for Defishy to Create VaR Simulation Model With Euler Liquidation Health Graph View Implemented in EGP1

Cost: $3,500 per Month

Motivation For Ending Payment: As the protocol is non-operational there is no need for simulations or liquidation health graphs.

Grant Proposal 7: Anthias x Euler Alert System Grant Proposal

Cost: $500 per Month

Motivation For Ending Payment: As the protocol is non-operational there is no need for an alert system at this time.

Grant Proposal 8 Warden Finance Risk & Tooling Engagement

Cost: $50,000 per Quarter

Motivation For Ending Payment: As the protocol is non-operational there is no need for risk and analytics tools at this time. The Euler protocol will more than likely need these services once restarted but for now there is no work to be done.

Grant Proposal 9: Delegated Domain Allocation by Questbook

Cost: $222,000 for 3 months

Motivation For Ending Payment: As the protocol is not currently operational there is no need for a grants program. Additionally, with the uncertainty of what Euler will look like upon return, it would be beneficial to reevaluate this proposal and adjust it to the needs of the next version of the Euler Protocol.

Encode Club Grant Proposal

Cost: $30,000

Motivation For Ending Payment: This payment was already sent to Encode. However, Encode was not able to distribute these funds to grants due to the hack. Since the dispersion of these funds for grants is not currently possible, it would be beneficial to the DAO if Encode returned these funds.

Specification/Body Text:

This proposal would stop the following Payments

  1. $3,500 per month to DeFishy (now called Anthias)
  2. $500 per month to Anthias
  3. $50,000 per quarter to Warden Finance
  4. $222,000 to Questbook

Additionally, this would request the return of the following to the DAO treasury

  1. $30,000 from Encode

These service providers could then resubmit grant proposals closer to the relaunch of the protocol with any necessary adjustments concerning the new and improved V2. It would then be up to the DAO whether or not to onboard them again.

Next steps

  1. Discuss which of these agreements the DAO would like to end.
  2. Vote on Snapshot
  3. Stop payments 1-4 mentioned above
  4. Request the return of the $30,000 from Encode

Relevant Links:

Pros and Cons of This Proposal

Pros

  • Saves the DAO $4,000 in monthly costs
  • Saves the DAO $50,000 in quarterly costs
  • Saves the DAO $252,000 in 1-time costs
  • The grants can be reformatted to better fit the needs of Euler V2
  • Could allow the money saved to be reallocated to new programs

Cons

  • Service Providers might not reapply and we lose their services
  • Yes, in favor of the proposal
  • No, against the proposal
  • Modify the proposal

0 voters

3 Likes

Thanks for the proposal, @Matt_StableLab. We do think it makes sense to pause the DAO’s recurring expenses while the protocol is non-operational.

While we generally agree with your proposal, we would suggest two modifications.

  1. We think it is appropriate to pause quarterly payments going forward for as long as the protocol is non-operational but will ask the foundation for payment regarding completed work. At the time of the hack we had already allocated significant resources to building tools for the DAO (subgraph updates, tooling on Warden, and Dune dashboard updates) as well as working on risk proposals. We also continued our work for a few weeks after the hack as we felt it was the best way we could help at the time. We believe it is appropriate to be compensated for that work, but we agree that our engagement should be paused as long as the protocol remains inactive. Despite the pause in our engagement, we intend to keep working with the DAO to rebuild key analytics tools in preparation for the protocol’s redeployment.

  2. We believe that the tooling we have developed and our expertise will still be relevant when the protocol relaunches. Therefore, we feel it would be simpler to temporarily pause our engagement while the protocol is non-operational rather than terminate it. This will allow us to go back to building as soon as we get clear guidance from the team.

We are open to feedback from the community and look forward to assist the DAO in relaunching Euler.

3 Likes

@Matt_StableLab thank you for your proposal. I agree that the DAO should immediately stop all ongoing payments and conserve resources, since the protocol is not operational.

I would like to ask @Shippooor for more clarification on their expectations.

Considering that the proposal for your quarterly compensation was voted on February 25th, commencing your official contribution period on March 1st, it is important to address the situation following the protocol’s discontinuation on March 13th. What are your expectations in light of these circumstances? I want to emphasize the inequity of requesting full compensation for less than two weeks of involvement. The DAO did contract you for a quarter, but nonetheless, given the circumstances, it would be highly appreciated if you could demonstrate some understanding.

1 Like

Thanks Matt! I generally agree that these expenses are not necessary as the protocol in non-operational. That being said, I would second @Shippooor request to disburse payments for work which was already done.

Once protocol is re-operational I would suggest the DAO to re-evaluate all previous commitments as outlined in this proposal before resuming payments.

1 Like

Hey All, Already pinged the team to say we are happy to return funds in the circumstances.

2 Likes

Title: eIP 56: End Current DAO Expenses While Protocol is Non-Operational
Author: @Matt_StableLab
Related Discussions: eGP 7, eGP 8, eGP 9, Encode
Submission Date: May 23rd, 2023

Simple Summary:

The DAO should reevaluate its service agreements and commitments made before the hack as they may no longer provide value during this time of rebuilding.

Abstract:

Prior to the hack, Euler DAO had commitments with 4 service providers. As the protocol is not currently operational and we are unsure what the new version of Euler will look like, it does not make sense for the DAO to continue funding these grants. The DAO is now in a far different state than when these agreements were initially made. As such, we should revisit their benefit to the DAO. Ending these agreements would also allow these service providers the ability to propose new initiatives that could benefit Euler V2.

Motivation:

Even though the Euler Protocol is not currently operational, the DAO is still spending money on tools, analysis, and grant programs. At present, these services are not needed and/or not possible due to the protocol being off. The DAO should consider ending these agreements. Stopping these grants would also allow the service providers to revamp their proposals to become better aligned to serve Euler V2.

Below is a breakdown of the DAO costs that should be re-evaluated.

eGP 6: Grant Request for Defishy to Create VaR Simulation Model With Euler Liquidation Health Graph View Implemented in EGP1

Cost: $3,500 per Month

Motivation For Ending Payment: As the protocol is non-operational there is no need for simulations or liquidation health graphs.

Grant Proposal 7: Anthias x Euler Alert System Grant Proposal

Cost: $500 per Month

Motivation For Ending Payment: As the protocol is non-operational there is no need for an alert system at this time.

Grant Proposal 8 Warden Finance Risk & Tooling Engagement

Cost: $50,000 per Quarter

Motivation For Ending Payment: As the protocol is non-operational there is no need for risk and analytics tools at this time. The Euler protocol will more than likely need these services once restarted but for now there is no work to be done.

Grant Proposal 9: Delegated Domain Allocation by Questbook

Cost: $222,000 for 3 months

Motivation For Ending Payment: As the protocol is not currently operational there is no need for a grants program. Additionally, with the uncertainty of what Euler will look like upon return, it would be beneficial to reevaluate this proposal and adjust it to the needs of the next version of the Euler Protocol.

Encode Club Grant Proposal

Cost: $30,000

Motivation For Ending Payment: This payment was already sent to Encode. However, Encode was not able to distribute these funds to grants due to the hack. Since the dispersion of these funds for grants is not currently possible, it would be beneficial to the DAO if Encode returned these funds.

Specification/Body Text:

This proposal would stop the following Payments

  1. $3,500 per month to DeFishy (now called Anthias)
  2. $500 per month to Anthias
  3. $50,000 per quarter to Warden Finance
  4. $222,000 to Questbook

Additionally, this would request the return of the following to the DAO treasury

  1. $30,000 from Encode

These service providers could then resubmit grant proposals closer to the relaunch of the protocol with any necessary adjustments concerning the new and improved V2. It would then be up to the DAO whether or not to onboard them again.

Next steps

  1. Discuss which of these agreements the DAO would like to end.
  2. Vote on Snapshot
  3. Stop payments 1-4 mentioned above
  4. Request the return of the $30,000 from Encode

Relevant Links:

Pros and Cons of This Proposal

Pros

  • Saves the DAO $4,000 in monthly costs
  • Saves the DAO $50,000 in quarterly costs
  • Saves the DAO $252,000 in 1-time costs
  • The grants can be reformatted to better fit the needs of Euler V2
  • Could allow the money saved to be reallocated to new programs

Cons

  • Service Providers might not reapply and we lose their services
2 Likes

Hi @Matt_StableLab , thank you for sharing this proposal. We agree with the idea of temporarily pausing DAO’s expenditures while the protocol remains non-operational. Since our proposal has not utilized any resources from the DAO thus far, we are open to resubmitting our proposal after the protocol has more clarity on its roadmap and its new version’s structure.

In our view, it is crucial for the protocol to actively involve quality contributors in shaping and implementing its future plans during this phase of rebuilding. Implementing a grants program would serve as a valuable means of attracting talented contributors to shape and execute its new roadmap. Till the time the protocol is operational again and ready for a grants program, we will continue to support and contribute to achieve what is best for Euler.

2 Likes

eIP 56: is now live on Snapshot

Voting on this proposal has ended and eIP 56: has passed with 100% approval

Hey @Matt_StableLab , I just saw this proposal and was wondering

  1. Euler Foundation contract

a) Why the DAO’s contract with Euler Foundation wasn’t included within this proposal, some links for reference:

“The Foundation made this 2-year agreement with Euler Labs in 2Q2022, prior to DAO launch.At the one-year anniversary of the contract, the DAO will be able to review the performance, comment, and vote to ratify the second year of the contract.”

b) Considering the text posted above, this contract is ready for review and hasn’t been ratified by the DAO; not saying that it should be terminated, but its almost 8x the size of the largest contract posted on your proposal.

  1. Conflict of interests

Based on what I described on point 1, I would consider this proposal a conflict on interests based on the Euler Foundation’s relationship with your company: Announcement of Contractual Engagements

Would love to have another independent member of the DAO audit this proposal and in any case re-submit it for the DAO to vote.

3 Likes

Hey @0xPEPO ,

Thank you for the questions. The contract you referenced is between Euler Labs and the Euler Foundation and was agreed upon before the formation of the DAO. Since the contract was not made directly with the DAO, it was omitted from eIP 56.

However, as you also pointed out, the DAO will have the opportunity for consensus around this contract shortly. There is currently a draft proposal being worked on for the DAO to ratify the contract between Euler Labs and the Euler Foundation. I will post this proposal on the forum by next week. This proposal will allow the community to vote and decide whether or not to continue with the contract.

StableLab’s contract was also with the Euler Foundation and not the DAO and therefore not mentioned in eIP 56. Our contract will also have to go through a ratification vote by the DAO in September when it comes time to renew the contract.

We agree that there would be a conflict of interest if we were to author the proposal to ratify StableLab’s contract with the DAO. We would welcome a community member who thinks we have provided value to the DAO to author this proposal and push it toward a vote in September.

1 Like