Focus on newcomers: healthy long term community building

Delegation Pitch
1

Hello everyone!


I’m an independent candidate who spends a lot of time thinking about ways to improve Uniswap.
I’ve entered the public space to participate in Uniswap’s governance, and I offer my services as a delegate.

I do not have a set agenda; I generally try to find a more optimal solution to the matter at hand while being attentive to different sides of the argument.

I do not hold obligations to any groups, and I believe I don’t have conflicts of interest that could skew my neutrality in assessing the proposals.

By delegating your votes to me, you help to decentralize the active voting power in the protocol. You also could do that by self-delegating and being active.

As a governance forum participant, I’m fairly active in discussions and Temperature and Consensus checks. I’m likely having the highest rate of participation in soft governance checks so far.

My overall view of the UNI distribution event.


I consider the UNI distribution event as a historical one. It is the first time that I know of when a company creates an enormous amount of value, gets unequivocal leadership in its niche – and then decides to give away up to 60% of its “shares” to its network participants from the outside. My analogy for this event is: imagine Amazon distributing 60% of its shares 20 years ago towards its customers and merchant partners.

This is not a typical Initial Coin Offering where people invest money into a company that prints 3-4x amount of that money in the form of candy wrappers, an event that inevitably creates a complete set of perverse incentives.

This is an initial value and responsibility distribution.

I respect this action by the Uniswap team and am willing to contribute to the protocol development.

Thesis: Fairness of wealth distribution is a crucial factor for the protocol’s ability to gain network effects.


My question to check for fairness is the following one:

“Is it possible to substantially surpass the original protocol in the fairness of its wealth distribution?”

My answer to that for UNI is no. The same answer applies to Bitcoin and Ethereum. But even though the initial distribution is fair for UNI, it can possibly be ruined through the governance processes.

Ultimately the ‘fairness’ comes down to the distribution of wealth between different groups of actors in the system. For the most part, these groups are:

  1. Providers of network functionality

    • Miners and stakers for PoW/PoS, Liquidity Providers for Uniswap

  2. Past, present, and future investors into the protocol

  3. Developers (in a broad sense of the word)

  4. Users, and

  5. Governors.

When incentives are distributed evenly, the groups tend to intersect more.

Miners become holders and users, holders and users become developers and governors, etc.

Focus on newcomers


Uniswap is a go-to swapping protocol on the Ethereum blockchain.

If Uniswap develops harmoniously and Ethereum gets mass adoption, the sky is the limit for all groups involved, as long as UNI captures the value that Uniswap DEX generates. It is an enormously positive-sum game then.

But there also is a scenario where one group takes advantage of the others and brings the game closer to zero-sum. This way, the protocol advancement would get staggered, and the resulting pie would become a lot smaller compared to the first scenario.

To be sure that we are on track to create a bigger pie, I propose to focus on newcomers to the network.

Uniswap has already been inclusive towards new liquidity providers from day one. Let’s keep it that way.

If we talk about future investors, caring for them can be done by bringing the store of value property to the UNI token. I think this change is the most important thing to do to bootstrap the network effects as it affects everyone.

The same logic applies to other groups.

To sum up, it needs to be a good thing - becoming a new long term network participant at any point in time in the future.

Happy newcomers naturally tend to bring in more newcomers to the network.

Policy directions


Below are the policy directions I find particularly relevant to the protocol advancement:

1. Tie the token’s worth to the value the Uniswap DEX generates.

The most natural way to do that would be to activate the fee switch and distribute the unlocked fees towards UNI token holders in ETH.

2. Strategic liquidity provision incentives

The key questions I find significant when deciding whether or not we should additionally incentivize a pool via UNI distribution are:

  • How big is the community that we’re trying to get interested?
  • Would we advise people who want to accumulate UNI tokens to buy the tokens we promote? What are the chances that people will lose money on these buys?
  • How efficient is the distribution we’re aiming to do?

3. Fostering the growth of inclusive, cooperative, and complimentary developers network.

4. Encouraging participation in Uniswap governance.

Governance assets distribution


When it comes to the way we design UNI distribution incentives, I believe they should be moderate and complementary:

  • Moderate to appeal to long term supporters and discourage short-term speculators

  • Complementary to encourage a deeper level of community involvement. This way, the distribution encourages full-throttle activism. An essential change in this regard would be to allow UNI tokens from liquidity mining pools to participate in governance and enjoy the benefits of that participation.

My modus operandi as a delegate:


I’m planning to vote no on all sudden proposals. That is, on proposals that haven’t been discussed at the forum and haven’t passed the soft governance procedures.

I’m fairly active when it comes to discussions on the forum and participation in temperature and consensus checks, so my stances on the matters can be easily found.

I’m still going to announce my voting decisions here with some short explanation on why before the proposal is live so that the delegators can revoke their votes if they disagree.

The history of my voting is available in the second post. My activity on the forum can be assessed via my profile page.

==

Why delegate?

A delegate doesn’t need 10 million UNI to bring the proposal to vote.

The necessary requirement to pass the temperature check is 25k UNI - and 50k UNI for the consensus check.

The closer my voting power to these numbers, the easier it is for me to bring to light the proposals I find beneficial for Uniswap improvement.

==

Thank you for reading.

If you’d like to delegate me your votes, here is the address:

0xe1DC8CeA0BeC8A0638E4dD26D9092edab9F60f9B

You can also use this address to the same effect:

misterpo.eth

Cheers,
Mr. Po.

13 Likes
2

Past votes:
UP01 Reduce UNI Governance Proposal & Quorum Thresholds - NO
UP02 Retroactive Proxy Contract Airdrop — Phase One - YES
UP03 Uniswap Grants Program v0.1 - YES

2 Likes
4

I like that you defend a long term vision @Mr_Po.

As $UNI holders, it would be clever to think about how to grow Uniswap adoption, because this would increase $UNI real value. Oppositely we shouldn’t try to pump $UNI with timelocks or other artefacts, because this won’t last.

You can count me in for now :sunglasses::unicorn:

2 Likes
5

Thank you for your measured and thought out pitch to this, I have been looking for someone with a mature outlook to delegate my large holding of Uni to.

A couple of things before I commit, do you have further platforms we can follow you on? Twitter, forums etc?

Do you have a way we can follow the number of votes delegated to you?

Best wishes

P.s. I dont see your address on the leaderboard posted here: Delegation pitch leaderboard

I would find it hard to delegate to someone who doesn’t have skin in the game.

1 Like
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Thanks for your interest, nicoGD & uni123 & the people who liked the pitch.

==

Uni123,

#1 This forum is the first public space I’ve become active on, and it is currently the only one.

I will create accounts on other platforms, but for the purpose of announcing my voting decisions.

If you’d like to get to know what my thinking is, the best place to do so is through the forum:

  • The complete picture is available through my profile activity tab.

  • I also intended to keep a short version of my policy statements as the 2nd message in this topic. But, as it’s not editable, I’ll be making new policy statements messages and delete the old ones. It’s probably better anyway as it notifies you when a change has been made. I’ll try to make the first one of those closer to when the voting begins.

  • And lastly, I’m available publicly through this topic and privately through direct messages on the forum if there are any further questions you’re interested in my stance on.

==

#2 I believe the best way to follow the number of votes delegated to me will be through Dune analytics if you sort the addresses by the number of delegators.

My delegator count will rise closer to the date when the voting begins due to my own and my friends’ participation at the very least. So it will be trackable, but at the moment, the number is 0.

==

#3 As for skin in the game, I’ve committed most of my life’s savings towards the UNI liquidity mining program. I plan to continue participating in it as long as there is a BTC/ETH pair, and distribution rates are not wholly negligible. I’ve advised my friends to do the same thing and assisted them with it. I’m not sure if there is a way one could break the LP contracts through governance proposals, but it would immensely hurt my well-being if that was to happen.

When it comes to UNI, I do not possess any significant amount yet. I am a newcomer, and I’m interested in accumulating a larger UNI position over the long term. I think it aligns with my program well. I do not qualify as a past/present investor, but I do as a future one.

With me having around 1% of UNI I’d like to own, my interests would get hurt if, for example, a proposal that artificially pumps UNI price by introducing ponzinomics concepts would pass.

==

P.S.

There is a reason why this is my first public appearance. It’s a combination of two things.

Firstly and shortly, I find the cause worthy.

And secondly, my path in life and things I cherish have forged me the way I find fitting for this participation.

This is the first public cause, where I feel like I could make a meaningful difference. So I’m going to be making it no matter how small the actual effect is.

Cheers,

Mr. Po.

4 Likes
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Thanks for the response PO, you’re correct I had forgotten those with the Uni in LP won’t show on the vote list, and it’s a very important factor in Uni’s success.

For now I am delegating to gauntlet.network as they have the largest share of votes and will be first to be able to make new proposals, furthermore they have a good presence with research approach and clear accountability. 0x6626593C237f530D15aE9980A95ef938Ac15c35c

Please keep a presence here in the forums and I’m sure I will be looking to move my support at some points in the future.

1 Like
8

Uni123,

Well, if you aim to increase the number of delegates who can make proposals, I believe you’ve made the right choice. Gauntlet network does have a reputation to lose, and they do stress tests as a part of their job. They’ve also stated that they’ll be politically neutral, which is a good thing for a proposal submitter.

For a community delegate like me to become a good proposal submitter, the infrastructure isn’t there yet. We need people who would write the code and audit those proposals, and we haven’t built those networks yet. So it’s good to have delegates who could do that on their own, at least for starters. And it’s good that they’re neutral.

I’m a different type of delegate though, my policy is not neutral, and my main job as a delegate is to vote according to my statements.

1 Like
9

I’d love to chat on a 1on 1 with you good friend, if that interest you don’t hesitate to reach out! I’ve got quite a bit to stand on this I think we’d have a ball

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The first proposal is Up to vote: “Reduce UNI Governance Proposal & Quorum Thresholds”

The voting will end on the 19th of October. I’ll allow myself to vote starting from 18:00 GMT on 18th Oct (72 hours notice).

My plan is to vote against this proposal.

I’m against this proposal because it is a Rider proposal.
It looks like the Uniswap community supports reducing the threshold for making governance proposals, but there is no such thing in regard to reducing the quorum threshold.

I think the quorum threshold should not be lowered as it compromises the safety of the protocol. And I find it unethical to make such a proposal in a way it’s been made.

Edit: I’ve used some harsh words earlier towards Gauntlet. Now that they’ve abstained from voting on the second proposal, it’s time for me to reconsider.

I still see no valid reason for lowering the quorum threshold, and I find the analysis done to justify it as unfounded.
I still think that making a Rider proposal is unethical. Especially when it’s done so that a contentious proposal can pass. That’s not neutral.
Lowering the quorum threshold would still increase Gauntlet’s stake at Uniswap governance considerably. I don’t find that neutral either.

Abstaining from voting on UP02 is neutral, though.

3 Likes
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Important update.

As it turns out you can’t revoke your votes once a proposal is submitted.

So my idea of announcing my votes beforehand makes little sense within the present system.

I don’t think this delegation system is healthy, so I propose we change it here.

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The second proposal will be Dharma’s retroactive Uni distribution - Phase 1.

Initially, I was against this proposal:

  • I’m generally against airdrops as I view them as an inefficient way to spend resources
  • UNI holders don’t benefit from the airdrop
  • some bad actor signaling happened during the first proposal: no announcement + a rider that lowers the quorum to the ‘convenient’ number.

But when it comes to the essence of the Phase 1 proposal, it suggests rewarding past users of Uniswap that used application integrations on top of Uniswap, mainly MEW, Argent, and Dharma.

I do consider these users as Uniswap users.

All Uniswap users before 1st Sep 2020 received an airdrop of 400 UNI.

I think it makes sense to reward past users evenly. And I think it’s a small price to pay (5m UNI) to achieve a slightly fairer initial distribution.

Also, it does decentralize the supply distribution a little, which is a good thing at these early stages - not distributing anything would create a honeypot.

So I will vote Yes to the Phase 1 Proposal.

I do not benefit from it, I will not receive an airdrop.
As a matter of fact, I’ll be slightly worse off as it dilutes UNI’s value a little bit - but so will any other distribution, so we probably should be ok with that.

I think it is the right thing to do. And it aligns with the statements I made in my delegation pitch: this proposal does have a positive effect on community building, albeit it is somewhat sprayed.

However, I do not consider people who used Dex aggregators (mainly Kyber, 0x, and 1inch) as Uniswap users, so I will vote against the Phase 2 Proposal.

==

P.S. As my modus operandi part of the pitch is not realizable within the current system, I encourage you to view this topic more as a voting blog.

Self-delegating is currently a better option.

Delegating to me would mean that you’d have to trust my judgment calls, as you can’t revoke your votes once the voting has started.

1 Like
13

@Mr_Po, I think this is a very reasonable stance, and this is precisely why we split the proposal into two phases.

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I disagree , I think another airdrop is necessary. I made a transaction before the deadline and never got my airdrop. I think people who came after deserve a shot as well. Greater adoption, better long term results. IMO

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Thanks for your interest

16

Edit: this is my original stance, I have reconsidered it since. The explanation is in the subsequent post.

I will vote against the proposal to restart the liquidity mining program for the top-4 pairs with 50% of the rewards. I have posted a lot of thoughts and metrics in the topic, I’ll copy my conclusion here::

Overall, I have found no convincing argument to restart the program for the top-4 pairs.

Initially, the proposal seemed like a good idea to me, as I thought it represented the middle ground between the interests of different parts of the Uniswap Community. I have reconsidered my stance since.

Now it seems to me that there’s not much to gain here for all the major groups: LPs, Users, UNI holders.

It also doesn’t look like a good investment in isolation. The targeted markets are the ones where Uniswap either already has dominance or has no chance for dominance.

The program is likely to be inefficient in its primary purposes.

The increase in the liquidity retention effect is expected to be considerably lower than after the previous two programs.

We also know that increased liquidity doesn’t increase the volume or the average trade size, so excessive liquidity is not needed.

As for the community-building perspective, for the most part, we just invite LPs who left to come back temporarily.

The improvements to the user experience will be quite negligible and not worth the cost. If my estimations are correct, more than 87% of the trades on top-4 pairs happen with a <0.01% slippage already. For reference, the UI doesn’t show if the slippage is 0.001% or 0.009%.

Current liquidity providers on the top-4 pairs don’t get much from this program either: their APYs are likely to stay the same. Except they’re rewarded in respective coins now, and with the program, they’ll receive UNI instead.

The primary beneficiaries of this program are large LPs who left Uniswap after the program finished.

UNI holders pay for this program, and it sounds like a bad investment.

Sushiswap is not a competitor to Uniswap on these pairs, and the numbers there are not sustainable and likely have signaling purposes.

I also find it a bit questionable to view the restart of the initial program as maintaining the status quo. If someone proposed to repeat the original airdrop with a smaller size, it certainly wouldn’t be viewed as such.

I will vote against the proposal.

I think the modified version leads to less decentralized distribution than the original, but I would vote against the original version too.

Even though I’m pro-distribution overall, and I think it’s ok if a distribution is somewhat inefficient, the inefficiency of this one is a bit too high for my taste.

We can do better, and nothing is pressing us to restart the liquidity incentives immediately.

2 Likes
17

I recommend listening to the 2nd Uniswap community call to everyone who missed it. There’s some quality discussion there. After hearing additional arguments, I’d like to adjust my stance.

I acknowledge that there is a strategic value to incentivizing the WBTC pool in the near future.

Addressing my previous arguments:

  1. The market leadership argument is not entirely correct.
    Uniswap is the leader in volume on WBTC/ETH pair, but it’s far away from leadership on BTC/ETH pair, of course - and this is a top-3 market in crypto space.
  2. In terms of slippage on large trades, WBTC is the only pool that it makes sense to incentivize comparatively:

percentile slippage

0,01% slippage seems like a good target to strive for.

As WBTC traders utilize the liquidity more in terms of trade sizes, additional incentivization would bring the experience on par with top USD pairs.

  1. WBTC has the smallest number of makers and takers among the top-4 pairs.

This fact doesn’t imply the direction of incentivization, though.
Do we want to reward a pair with more makers and takers to decentralize the distribution? Or a pair with fewer makers and takers in hopes that the number grows?

  1. WBTC-ETH pair is indeed the most responsive to liquidity incentives, likely due to the lower volatility.

Even though the retention of liquidity after the program is only 31%, the growth in Liquidity/Volume ratio compared to the period before the program is still quite substantial:

Liquidity_Volume growth
Liquidity_Volume growth573×501 16.8 KB

Another notable pair in this table is DAI.
As we can see, DAI gained the most out of the UNI program in terms of Liquidity/Volume ratio growth.
How we interpret these results is up to us.

In my opinion, the key difference between Sushi and UNI programs is that the first one incentivized a lot of pools, and the latter only 4.

Being one of the top four pools brought a lot of legitimacy to DAI and WBTC, which had positive feedback loops regarding LPs’ comfort to park their money.

The least successful pair in terms of gaining retention effects from the program is USDC.

  1. The money that will go to the WBTC-ETH pool will likely stay there only temporarily for the program’s duration. And the large portion of the distribution will likely be received by large funds.

It then comes down to the decision we need to make - how strategically important it is for us to have big liquidity on the BTC pair.

If we find it crucial, we can opt to renew WBTC incentives repeatedly and keep that temporary liquidity.

==

The reasoning above would make me vote for the proposal that would incentivize only the WBTC pair.

There is no significant drawback on USD pairs in trading experience, they perform well without the program, and Uniswap doesn’t have a new niche to take with them. So I would vote against restarting LMP for them.

If I were to modify the initial proposal, I would take an even amount out of all USD pairs, not just DAI.

DAI pair in the initial program invited a bigger number of new LPs to Uniswap - and was a quite successful investment in general.

Overall it makes me neutral, so I will actively abstain from voting .

I believe both outcomes have their own merits and drawbacks, and I approve of both of them.

2 Likes
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salut je suis nouveaux qui peut mepauler un peu mexpliquer mieux le sa me plait beaucoup uniswap merci les uniswapeur

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I’ve voted YES on the UP3: Uniswap Grants Program v0.1.

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I appreciate your point of views and devotion to your role as delegate. I am a newcomer and you have my vote :hugs:

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I know this is going back a bit, but I’ve been looking at delegates as I’m unsure how much time I’ll have to partake in governance now that I’m actively working on the codebase of Uniswap and other platforms.

To the first point, regarding proxy contracts… These users made a choice to use a different platforms, Dharma, MEW, Argent; now 1inch, etc. in order to choose convenience over actual implementation of the platform. In doing so they have provided the proxy with all of the distribution from liquidity and whatnot. DEX aggregator or proxy wallet/contract it’s the same. At any point these systems could develop a proprietary token for any number of utilities (such as Trust Wallet did with TWT recently).

In the same way that you’re asking people to delegate voting power to you, proxies asked users to delegate options to them in exchange for convenience. If I delegate my votes to you, and don’t like how you voted, I can change delegators, but I can’t change how my votes were allocated.

It is also not-so-insider knowledge that Argent will be doing a retroactive governance airdrop in the near future, I’ve heard but not confirmed that Dharma is as well.

UNI token is available on many exchanges now, as collective users of any of these proxies, I really think that it should be up to the proxy to determine if they care enough about their user base to provide them with UNI tokens. Any of these platforms could purchase UNI and distribute to users if they wanted to; they did not. Once we do a retroactive airdrop, we can’t take that back if that platform them goes and creates their own governance token. This could be bad for governance on Uniswap as a group with sizeable delegations in UNI and their own token can make proposals that give them more of a benefit. Which leads me into my second problem with this statement:

Regarding it decentralizing the supply, governance, and being positive for the community, I don’t think it’s so simple.
Say we do an airdrop to proxy users. We control the communication for Uniswap, but not for any of the proxy apps/wallets. They can—through a separate platform in which Uniswap holders are not using or privy to—make their own delegation pitches outside of the community here.

I think giving direct UNI governance to users of proxies will have the exact opposite effect of decentralizing the system, it’s introducing a vector very early in the governance process for proxies to broadly sweep delegation from their users and have a huge amount of say in Uniswap governance for the benefit of the proxy, not the users. We’re rewarding users who will, going forward be operating within a separate walled garden of that proxy’s dapp/wallet. This is a recipe for the formation of conglomerates and a very centralized system where we see 3 or 4 big groups controlling all the votes.

I don’t think that “fairness” or “equality” is grounds to authorize a retroactive airdrop to these users, nor do they apply here. Nobody has missed the train when it comes to crypto and DeFi… it hasn’t even left the station. There will be a plethora of opportunities for users who missed the UNI airdrop in the future; being loyal to a platform (or using them all) can pay off.

I think it would be a mistake to add a vector for centralization into Uniswap governance this early on. It would be a trivial matter for Dharma (not saying they will, just using them as an example as they’re the biggest name on this topic) to add a banner to their app saying “Delegate your UNI airdrop to Dharma.” Remember, people use platforms like Dharma, Argent for their convenience.

What’s more convenient?

  • Getting a UNI airdrop into your Dharma wallet, retaining ownership of the tokens, and clicking a button to delegate your UNI to Dharma to vote on Uniswap, or:

  • Leave the platform (Dharma) that you’re comfortable with, join the Uniswap governance forums, and go through the process of finding a delegate that aligns with your views while managing your UNI and other assets through the above-mentioned proxy.

Proxy users who missed out were rewarded already, with a convenient all-in-one DeFi app that didn’t require they really integrate into Uniswap to get the benefits of it’s existence. It’s just simply too early and easy for proxies to sweep their users into delegating UNI to them, potentially launching their own governance, and now having a big portion of the say in two platforms, turning Uniswap into the workhorse for whichever group gets the most delegates.

In the event of a future airdrop, there won’t be more happy Uniswap users, simply happy users of proxy apps who have enough assets to placate them while the proxy app gains voting power. Rest assured that it will not be individual delegates with most of the say, it will be a handful of these proxies with a lot of newfound voting power.

One of the best things to happen to crypto was the emergence of many different DeFi apps, we don’t have an obligation to make everyone happy, especially considering that over the next few months, 15 different apps will be following suit and coming out with their own governance token, many of which allowed users to use Uniswap via their platform.

3 Likes