[BIP-32] Funding Proposal for Daoism Systems: PROTOCOL REVENUE SHARING FOR POOL & FACTORY CREATORS

PROTOCOL REVENUE SHARING FOR POOL & FACTORY CREATORS

BACKGROUND AND MOTIVATION

Daoism Systems is a consultancy of computer scientists, engineers, and researchers developing on-chain solutions for web3 organizations, founded in Berlin in January 2022. Please read our manifesto for more details.

Our integrative expertise in decentralized technologies and applied research are at the core of our process. In our approach, we offer end-to-end solutions to develop resilient infrastructures for our clients; from the initial idea, to writing technical specifications, developing the product and maintaining it. Our team is continuously growing and currently consists of 15 people, 80% of whom are web3 developers.

Our team members have been developing web3 solutions since 2017, and the Daoism Systems team has been an active development force in the Balancer ecosystem, especially by developing PrimeDao’s main products - Pools and Launch. This proposal is an initiative of our team to establish stronger relationships between Daoism Systems and Balancer, as well as bring our expertise to further expand Balancer’s ecosystem.

GOALS

Referring to the proposal from February 11th, we truly believe that the implementation of the protocol for revenue sharing for pool and factory creators will not only improve Balancer’s governance effectiveness, but also increase the attractiveness for developers to create new products on top of Balancer.

SOLUTION

Our approach is to set up a dedicated team that will work exclusively on this project. For the development of an automated and permissionless model for revenue sharing with pool creators, we will provide the following resources and approach:

  1. Technical specifications: Before starting to develop, we will set up a complete technical specification, containing a detailed description and architecture of our solution.

  2. Development: After some iterations (if needed) and Balancer’s approval of the technical specifications, we will start to develop. For this task we will provide the following team:

  • 1 x FTE Tech Lead: will lead the development and align the developers.
  • 1 x FTE Senior Solidity Engineer: will write, test and deploy Solidity smart contracts.
  • 1 x FTE Solidity Engineer: will also write and test smart contracts.
  1. Audit: After the code is written and deployed, an independent auditor will review the code and compile an audit report. If there are any suggestions for improvement, we will implement them in the code (please note: payment for the audit is not a part of the proposal).

BUDGETING AND TIMELINE

Cycle 1 - Tech Specs

For the technical specifications, including the iterations, we require two weeks.

As we are looking to develop a long-term partnership with Balancer, we love to put “skin in the game”, therefore we are requesting 4000 BAL for this step.

  • Duration: 2 weeks
  • Reimbursement: 4000 BAL

Cycle 2 - Development

The development, including an independent code audit, is expected to take three months.

For the provision of developers, we have the following prices:

  • 0.5 x FTE Tech Lead: 6.5K USDC per month

  • 1 x FTE Senior Solidity Engineer: 10K USDC per month

  • 1 x FTE Solidity Engineer: 7,5K USDC per month

  • 1 x Management Fee: 1000 BAL per month

For the independent code audit, there will be a separate proposal.

  • Duration incl. Audit: 3 months
  • Reimbursement:
    • 24K USDC & 1000 BAL per month for the first two months (100% FTE)
    • 12K USDC & 1000 BAL for the third month (50% FTE because of audit)

TOTAL FUNDING AMOUNT

60000 USDC and 7000 BAL

MULTISIG ADDRESS

0x94902b6c41F1e167c019C5707D749B95345bb02c

8 Likes

Fully support this proposal as it is important we see more dev teams join the Balancer ecosystem. The only concern here is that you are new to this community and if we simply send over 60k USDC and 7k BAL we open up a risk that this isn’t completed on time or the work isn’t to an acceptable standard and we have no recourse.

I’d also note concerns were raised on PrimeDAO’s forum that Daoism is handling Prime Launch, Prime Pools, and it seems Prime Rating dev work so you all are already quite busy.

My suggestion is to slightly restructure this proposal to 60k USDC paid upon approval and 7k BAL paid once Orb Collective signs off that the work was completed to specification.

6 Likes

Hey guys, great to see this proposal!

I think it’s important to fund this proposal. We want to attract teams building on top of Balancer and teams building common infrastructure at the protocol level. This proposal is a great example of a team building common infrastructure so, we should reinforce this behavior. Additionally, the piece of infrastructure that will be built here incentivizes teams that build on top (pools and factories).

I also want to thank the DAOism team for a doing a scoped out and project specific proposal on an item that the community had previously signaled their interest in.


To dive into a few of the specifics,

It’d lessen the process of due diligence on the veBAL holders and would be a great piece of reference and context for the community if you could please link to some of the projects that you’ve previously built in the space.

Do you have any sense around who the auditor will be, how long they’d need for auditing and how much that would cost? Although I understand that you don’t want to lock down a slot before ensuring that this proposal goes through, I do worry about the uncertainty of Balancer governance needing to approve the consequent audit proposal due to the sunk cost of this proposal. As such, I think some additional information on that upcoming proposal would be much helpful for this proposal to move through.

You mentioned that DAOism would like to receive some BAL to build long term relationships with our DAO. This is amazing and I’m thrilled to see this! Looking forward to a long term relationship and the official entry of the DAOism team into the Balancer ecosystem. :handshake:
For the sake of transparency for the community and voters, would you expand on this a bit please? Future is of course uncertain but, as of now, are you planning on holding onto this BAL? Will you be vote escrowing it? What are the chances that you might sell this BAL within a few months of receiving it? If there’s likelihood of market selling, the community would appreciate the heads up and the treasury might appreciate the chance to contemplate a full USDC payment.

I do realize that before embarking on development you’ll be doing a deep technical spec. I think it’s important for Orb or BLabs or other technical entities in the ecosystem to review this spec before you embark on development. Although, that review will be much more in the service of DAOism to ensure you’re going down the right path.
For the benefit of community and voters, it’d be great to have a higher level architectural spec before approving the proposal. This would perhaps be very similar to what you guys used in order to estimate the costs so, hopefully it’s an existing piece of document and not a big burden on the team. :pray:

I do agree with @solarcurve on not doing a full up-front payment although, I will let the specifics of that to him and the guys at Treasury.


Lastly, I want to once again stress how amazing it is to see a qualified team joining the Balancer ecosystem and building the protocol with us! :handshake: :raised_hands:

7 Likes

Dear @solarcurve,
thank you very much for your comment and support!

Regarding payments: Yes, this is a good point and we can fully understand that you want to see how we work first. To mitigate this risk we propose that we agree on some verifiable milestones and, as you suggest, arrange for payments to only be released after set milestones are met.

Regarding our workload: we are currently finishing up one of our larger engagements and if the proposal is passed we will be providing a team of developers 100% allocated to Balancer.

Considerations like yours are appreciated and we welcome any other comments or suggestions you may have!

7 Likes

I am also in support of this proposal and the mechanism of revenue sharing which it will enable. I am glad a team is able to tackle this and I know it will be a huge value add to Balancer. There are some teams & applications in mind I can already think of that would benefit from this project.

I would only like to echo Kia’s concerns above. Mainly, the expected costs of an auditor, and the details around communication between Daoism and Orb or Balancer Labs. Expected total cost to get this from inception to implementation are important in my opinion, even if they are large and can only be estimated it’s good to be up front about this. As for the comms, alignment between both parties I think will lead to the path of least resistance when it comes time to merge this into Balancer Protocol.

Very much looking forward to this getting off the ground.

3 Likes

It is great to see another professional organization wanting to get involved in the Balancer Ecosystem! This is a solution that has gone unanswered for while and we would be more than happy to support this proposal, however, we do echo some of the comments regarding payment and transparency.

  1. If you could provide us with more background about the teams and individuals working on the project
  2. In regards to the payment, DAOism could outline its agreed-upon milestones for payment for both USDC + BAL (+ monthly summaries would help us understand how you are progressing in your project)
  3. Why is the management fee in BAL? Why the preference over USDC?
  4. It follows on from Kia’s qs about BAL payment but if you could outline how you see a long-term partnership between Balancer and DAOism?

Your team would be tackling a great problem and we appreciate your efforts but further transparency about these questions would be helpful.

4 Likes

Dear Balancer-Community,

thank you very much for your comments and remarks! We have summarized them and hope to be able to answer all your questions. Please let us know if there’s anything else you would like us to address.

TEAM
We have a highly qualified team with extensive experience in the development of web3 projects. Our team has previously worked on API3DAO, Prime Launch, and Prime Pools (based on Balancer technology). We believe the most efficient approach will be to allocate a team solely dedicated to Balancer, and we’ve therefore assembled a strong team who are experienced in the Balancer technology.
The project will be lead by Arseny Akinfief (arseneeth (arsenee) · GitHub) and Konstantin Britikov (BritikovKI (Konstantin Britikov) · GitHub), with development support from Benjamin Halimic (GitHub: bxmmm1) and Francis Perez (GitHub: ftperez11) (can’t post more then two links due to the forum restrictions :slight_smile: ) .

AUDIT
We have an established relationship with Team Omega (who previously worked on the DAOStack tech team). The cost of an audit is typically between 15K and 30K USDC (for larger projects). Our long-standing relationship ensures that we are offered competitive pricing, and that our audits are given priority.

COMMUNICATION
In regards to communication with BLabs; We would be happy to establish a communication channel with key stakeholders for async communication as well as facilitate weekly or bi-weekly(once every two weeks) check-ins.

TECH SPECS & COLLABORATION
Tech-specs are the most important part of engineering that is included in the proposal already. We are happy to share the spec with the community and stakeholders when the proposal passes. We are in close contact with Orb Collective and they were actually the ones who recommended us to go ahead with this proposal. We are happy to collaborate and exchange knowledge and resources.

PAYMENT
We are happy to follow the payment structure proposed by @solarcurve where the BAL is being sent after the deliverables are met.
We also agree that a milestone based payment would be great for establishing trust. We aim to work with Balancer long-term and want to prove ourselves to the community as a reliable partner.

USDC/BAL AND LONG TERM COOPERATION
We are big fans of Balancer and want to participate in the development of the technology and the community in the long run. We therefore have no plans to sell off BAL, and we have deliberately designed the proposal to reflect that: the USDC is intended to cover operational cost, while the BAL ensures that we have skin-in-the–game and are committed to Balancer, by allowing us to participate in the Balancer governance and community, so we can be long-term BAL holders and eco-system contributors
We see this first project as a showcase of our skill and what we can deliver. Since the Balancer technology is constantly evolving, we would like to contribute to its long-term development with our knowledge and skills and become a part of the Balancer community. After the completion of this project, we hope to be able to propose additional development work so we can continue to work on the Balancer infrastructure.

8 Likes

Hi, @isolo! Thank you for this proposal.

The Orb Integrations Team is very excited about this effort finally being moved forward. Rev share automation unlocks so many opportunities for builders, especially those who don’t have the biz dev skills to establish relationships and acquire funding up front. I like to imagine a world where anyone with a laptop can build useful tech and earn revenue proportional to its usage. That vision aligns pretty well with the scope of the original rev share proposal.

I just wanted to jump in here and share that we’ve already chatted a bit with DAOism about this effort and we are very happy to take on a significant role in seeing this through. While the DAOism team will be responsible for primary development, we are available for design discussions, code review, and bouncing ideas. With that in mind, I’d like to outline a rough estimate of the tranched approach we might take:

Cycle 1 - Tech Specs

Duration: 2 weeks
Responsibilities:

  • DAOism: Produce full technical specification for the effort.
  • Orb Integrations: Review the spec, iterate, and approve before transition to Cycle 2.

Cycle 2 - Development

Duration: 3 months
Tranches: Every 1 month
Responsibilities:

  • DAOism: Produce smart contracts governing the rev share mechanism established in Cycle 1.
  • Orb Integrations:
    • Tranche 1: Cursory review of first month’s progress, correct/clarify course if needed.
    • Tranche 2: Cursory review of second month’s progress, correct/clarify course if needed.
    • Tranche 3: Deep review of final output prior to formal audit.
  • Auditor: Provide formal review and verification of smart contracts after completion of Tranche 3.

In addition to the more rigid tranche structure defined above, Orb Integrations is available for asynchronous questions or concept validation on an as-needed basis, up to a reasonable limit of time expended (at our discretion). We already have channels open with DAOism which would work perfectly for this.

That’s all I have. This is just a suggestion as to how we might approach the effort, and I’m open to feedback from DAOism or the Balancer community. Suffice it to say, regardless of how we decide to proceed, DAOism has the full support of the Orb Integrations Team.

6 Likes

Dear @rabmarut
Thank you for your feedback and suggestion!
The process you suggested also corresponds to our ideas and we are looking forward to a close cooperation!

1 Like

Dear Balancer-community!
Regarding the next steps: I will now add the updates regarding payment as discussed above and we look forward to submitting the proposal for voting on Thursday! :slight_smile:

Here is the updated version:

PROTOCOL REVENUE SHARING FOR POOL & FACTORY CREATORS

BACKGROUND AND MOTIVATION

Daoism Systems is a consultancy of computer scientists, engineers, and researchers developing on-chain solutions for web3 organizations, founded in Berlin in January 2022. Please read our manifesto 1 for more details.

Our integrative expertise in decentralized technologies and applied research are at the core of our process. In our approach, we offer end-to-end solutions to develop resilient infrastructures for our clients; from the initial idea, to writing technical specifications, developing the product and maintaining it. Our team is continuously growing and currently consists of 15 people, 80% of whom are web3 developers.

Our team members have been developing web3 solutions since 2017, and the Daoism Systems team has been an active development force in the Balancer ecosystem, especially by developing PrimeDao’s main products - Pools and Launch. This proposal is an initiative of our team to establish stronger relationships between Daoism Systems and Balancer, as well as bring our expertise to further expand Balancer’s ecosystem.

GOALS

Referring to the proposal from February 11th 6, we truly believe that the implementation of the protocol for revenue sharing for pool and factory creators will not only improve Balancer’s governance effectiveness, but also increase the attractiveness for developers to create new products on top of Balancer.

SOLUTION

Our approach is to set up a dedicated team that will work exclusively on this project. For the development of an automated and permissionless model for revenue sharing with pool creators, we will provide the following resources and approach:

  1. Technical specifications: Before starting to develop, we will set up a complete technical specification, containing a detailed description and architecture of our solution.

  2. Development: After some iterations (if needed) and Balancer’s approval of the technical specifications, we will start to develop. For this task we will provide the following team:

  • 1 x FTE Tech Lead: will lead the development and align the developers.
  • 1 x FTE Senior Solidity Engineer: will write, test and deploy Solidity smart contracts.
  • 1 x FTE Solidity Engineer: will also write and test smart contracts.
  1. Audit: After the code is written and deployed, an independent auditor will review the code and compile an audit report. If there are any suggestions for improvement, we will implement them in the code (please note: payment for the audit is not a part of the proposal).

BUDGETING AND TIMELINE

Cycle 1 - Tech Specs

For the technical specifications, including the iterations, we require two weeks.

As we are looking to develop a long-term partnership with Balancer, we love to put “skin in the game”, therefore we are requesting 4000 BAL for this step.

  • Duration: 2 weeks
  • Reimbursement: 4000 BAL

Cycle 2 - Development

The development, including an independent code audit, is expected to take three months.

For the provision of developers, we have the following prices:

  • 0.5 x FTE Tech Lead: 6.5K USDC per month
  • 1 x FTE Senior Solidity Engineer: 10K USDC per month
  • 1 x FTE Solidity Engineer: 7,5K USDC per month
  • 1 x Management Fee: 1000 BAL per month

For the independent code audit, there will be a separate proposal.

  • Duration incl. Audit: 3 months
  • Reimbursement:
    o 24K USDC & 1000 BAL per month for the first two months (100% FTE)
    o 12K USDC & 1000 BAL for the third month (50% FTE because of audit)

UPDATE 07/19/2022 - PAYMENT CONDITIONS:

As discussed with the community, we have adjusted the payment conditions as follows:

  • 60K USDC paid upon approval
  • 7000 BAL is being sent after the deliverables are met and Orb Collective signs off that the work was completed to specifications

TOTAL FUNDING AMOUNT

60000 USDC and 7000 BAL

MULTISIG ADDRESS

0x94902b6c41F1e167c019C5707D749B95345bb02c

2 Likes

In strong support of this proposal and looking forward to the opportunity to collaborate with the DAOism Systems team. I’d be excited to see our DAO2DAO revshare vision developed into tangible code!

2 Likes

https://snapshot.org/#/balancer.eth/proposal/0x29a37ab71ce03a5e167fd012c363e72088bd0554d2b25c99f3373fa7cceb7124

1 Like