Thanks to everyone who joined Community Call #12. We went through a recap of the last community call, governance sequencing, and active proposal load in the first part. After that had a working session on Delegate Rewards Framework V2 (led by @Curia)
Announcement: Community Call #12: Governance Alignment & Delegate Rewards V2 Workshop
Recording: https://youtu.be/zXbbRK7Tp_s
Active SIPs & Governance Load:
1. SIP6.1 & SIP6.2 DAO Risk-Managed USDC & ETH Vaults
These proposals operationalize the architecture previously approved. Here the sequencing matters:
- Risk framework funded
- Risk parameters defined
- Contracts deployed
- Guardians added
- Markets proposed
- Deposits opening upon execution
These proposals mark the first live expansion of the DAO-managed layer.
2. SIP5.20 Seal Whitehat Safe Harbor
A structurally important proposal, the Safe Harbor Agreement enables authorized whitehat actors to:
- Intercept exploits
- Legally intervene
- Recover funds when possible
This is less narrative-driven, more user and, institutional credibility. It strengthens long-term trust architecture.
3. SIP5.21 Remove Reward Route
Focused on recouping unclaimed SUMR. This directly impacts treasury runway and sustainability and indirectly affects the feasibility of delegate compensation models.
4. SIP2.53 Morpho V2 Redeploy
A maintenance governance proposal updating Arks. Operational, necessary, but not strategic in narrative scope.
5. RFC on EURC Vault Fee Adjustment
A proposal by @halaprix to reduce EURC vault protocol fees (currently 1%) due to competitive pressure. Options suggested:
- 0.5%
- 0.3%
- Alternative fee structures
If you are a @Recognized_Delegates, weigh in, fee design impacts vault growth and competitiveness.
6. Aerodrome Metagovernance Transparency
The veAERO multisig reported additional AERO purchases, and emission votes toward SUMR/USDC pool. Transparency remains a design principle.
Meta-governance execution is publicly tracked and reported - here.
Governance Complexity is Rising
Zooming out:
- Risk segmentation live
- Vault complexity increasing
- Treasury allocations more consequential
- Governance sequencing more layered
The key question raised: Is participation quality rising proportionally with complexity?
If governance sophistication increases but engagement does not, fragility accumulates quietly. This framed the second half of the call.
Delegate Rewards Framework V2 Workshop
Led by Katherine from @Curia.
This was a working session, not a finalized proposal with the goal to design a structurally sound incentive system aligned with governance maturity.
Foundational Consensus
- Governance remains part-time / voluntary
- Compensation = modest stipend, not salary
Success metrics:
- Consistent quorum
- Meaningful contributions
- TVL growth & new yield identification
Defining High-Value Work
Consensus seemed to circle around high-value contributions including a mix of:
On-chain:
- Consistent voting (baseline 80–90% participation)
- Governance stability
Off-chain:
- Proposal authorship or co-authorship
- Risk reviews
- Yield source vetting
- Thoughtful forum engagement
- Clear rationale communication
Important nuance raised by @Sixty:
Forum feedback before a vote is more valuable than post-vote rationale alone. Governance is shaped pre-execution.
Baseline Threshold Discussion
Preliminary agreement:
- 80–90% voting participation as minimum baseline
- Forum engagement expected
- Higher tier tied to substantive contributions
Threshold considerations:
- Current 10k SUMR participation cap may be too low
- Raising voting power threshold could reduce treasury strain
- Needs periodic reassessment (likely quarterly)
Compensation Structure Debate
Treasury currently cannot sustainably pay in stablecoins.
Primary asset: SUMR.
Core tensions:
- Unlocked SUMR → flexibility but predictable sell pressure
- Locked SUMR → alignment but reduced liquidity
- Streaming SUMR → smooth distribution, reduce shock
Streaming (e.g., via Superfluid on Base) emerged as an interesting middle ground:
- Denominated in SUMR
- Continuously streamed
- Reduces sudden sell cliffs
- Aligns month-to-month
Price calculation method remains open:
- Spot price?
- 7-day TWAP?
- 20-day mid-month average?
Quarterly Budget Cap
Strong support for:
A fixed quarterly delegate reward budget.
Why?
- Predictable treasury exposure
- Prevents uncapped growth as delegate count rises
- Aligns incentives with sustainability
Budget would be:
- Set per quarter
- Denominated in SUMR
- Split according to framework rules
KPIs should be reviewed quarterly.
Separation of Voting vs Forum Incentives
A key structural proposal from @Sixty was to separate reward pools:
-
Voting Incentives
- Reward governance stability
- Weighted by voting power
- Protect quorum integrity
-
Forum / Contribution Incentives
- PRS-based scoring (Peer Recognition Score)
- Top contributors rewarded
- Quality-weighted, not whale-weighted
This avoids:
- Forcing whales into performative posting
- Forcing smaller delegates to acquire massive voting power
- Overweighting one dimension of participation
This dual-structure model gained positive feedback, and is waiting for more input from @Recognized_Delegates.
KPI Framework
Discussed and proposed dimensions:
-
Governance Stability
- Quorum consistency
- Nakamoto coefficient
- Voting concentration shifts
- Proposal stalls
-
Contribution Quality
- % of SIPs with meaningful discussion
- Revisions due to delegate feedback
- Risk issues surfaced pre-vote
-
Decentralization Growth
- Increase in active recognized delegates
- Voting power distribution shifts
- New delegates crossing thresholds
-
Treasury Sustainability
- Compensation cost relative to treasury
- SUMR emission impact
- Governance cost vs vault growth
Quarterly reviewed with bi/annual structural reassessment.
Closing Thoughts:
As Lazy Summer Protocol grows in complexity, governance cannot remain informal. Risk frameworks are maturing.
Vault strategies are expanding.
Treasury decisions are compounding.
If incentive systems don’t mature alongside them, fragility builds quietly. Delegate Rewards V2 is not about generosity.
It is about:
- Protecting quorum stability
- Elevating contribution quality
- Strengthening decentralization
- Aligning incentives with long-term protocol health
- Designing systems resistant to gaming
This remains a Lazy Summer DAO process. Nothing imposed. Everything debated. Structure shaped collectively.
If you are a @Recognized_Delegates, lean in. If you are observing, this is where governance culture is defined.
Frameworks built now will shape resilience months from now. Continue the discussion on the forum. Contribute to the Miro board. Vote on active SIPs.
Governance is infrastructure. Infrastructure decisions compound.
See you on the forum and on the next call.
–jensei