FranklinDAO appreciates the UAC’s careful analysis of the governance challenges facing Uniswap. After careful consideration of the proposed solutions, our team believes that the DAO should prioritize governance quality and proven mechanisms over experimental approaches that may introduce new risks.
Our Positions:
Support: Expanded Treasury Delegations as the most effective near-term solution
Conditional Support: Optimisic Governance for specific use-cases and decision flows
Oppose: Community Proposal Factory and Quorum Reduction
Neutral: Incentivized Delegation Vaults (pending cost-benefit analysis)
Governance Evaluation Framework
Before addressing specific proposals, FranklinDAO it’s important to establish clear criteria for evaluating governance improvements. We think any changes should be assessed across three dimensions.
Efficiency: Speed & cost of decision-making processes
Robustness: Resistance to governance attacks, rent-seeking, and system failures
Quality: Likelihood of producing well-informed and beneficial outcomes for the DAO
These dimensions often involve tradeoffs, and our analysis prioritizes solutions that optimize across all three rather than maximize any single metric.
Detailed Analysis of Proposed Solutions
Community Proposal Factory (CPF) - Opposed
We’re opposed to @GFXlabs’s CPF solution for several fundamental reasons. First, quality considerations. The Uniswap ecosystem’s complexity requires an understanding of technical, tokenomics, and legal ramifications. Grassroots proposals usually come from participants with limited governance involvement. Thus, they’re unlikely to put forward proposals that advance the protocol’s interests without consuming substantial attention and resources.
Efficiency Questions: The CPF introduces additional governance layers and potential delays. If most grassroots proposals lack the depth required for implementation, the CPF becomes a mechanism that consumes delegate attention without proportional value creation.
Instead, FranklinDAO recommends an alternative by building on the current forum-based systems:
- Any address delegating a minimum amount of UNI (say 10+) to delegates with 1M+ voting power gain posting privielges on that delegate’s proposal page.
- Delegates can evaluate, refine, and champion worthy community suggestions.
This creates a representative-constituent model that provides screening and mentorship, incentivizes delegation to active gov participants, and maintains quality control without complex new infrastructure.
Incentivized Delegation Vaults (IDVs) - Neutral Pending Analysis
The fundamental challenge isn’t just moving tokens off exchanges, it’s creating sustained engagement. Even with incentives, retail participants delegate infrequently and remain largely uninformed about gov decisions. We believe that IDVs lack specific cost projections for the marginal increase in voting supply per unit of incentives. Given UNI’s lack of native yield, even modest incentives might drive participations, but maybe not.
FranklinDAO would like a realistic analysis of:
- Total emission costs for meaningful participation increases
- Expected persistence of delegations post-incentive periods
Since increased participation doesn’t automatically improve governance quality or efficiency, it’s important to ask how does broader participation actually enhance DAO decision-making beyond attack resistance?
FranklinDAO offers conditional support to IDVs if comprehensive cost-benefit analysis shows reasonable acquisition cost for delegated tokens, clear metrics for success are established, and the program includes sunset provisions to build-in clear evaluation windows.
Treasury Delegations - Strong Support
Treasury delegations represent the most proven mechanism for addressing quorum challenges while maintaining governance quality. Kudos to @Doo_StableLab for pushing the initiative.
Specific Recommendations:
- Increase total delegation pool beyond proposed 10M UNI
- Consider raising per-delegate caps above 2.5M for proven participants
- Expand eligible delegate pool to create redundancy against large delegation withdrawals
- Implement merit-based selection emphasizing voting consistency and decision quality
We believe that treasury delegations are the most straightforward path to meeting quorum reliably. It has further benefits of allocating voting power to proven governance participants, creates a buffer against single-entity delegation withdrawals, and has minimal ongoing operational costs.
Quorum Reduction - Opposed
FranklinDAO is strongly opposed to quorum reduction at this time. Lowering quorum is a short-term solution to a long-term problem facing every DAO, regardless of whether Uniswap’s participation threshold is higher or lower than other DAOs. Lowering the economic barrier for governance decisions increases attack vectors, which are particularly problematic given that some actors control 30M+ UNI and that some on-chain decisions are irreversible.
Alternative Path: Rather than reducing quorum, the DAO should focus on sustainable participation through treasury delegations and targeted retail engagement. Quorum adjustment might be warranted after implementing other solutions and observing their effects over 12-18 months.
Optimistic Governance - Conditional Support
Optimistic governance offers efficiency gains for specific categories of decisions:
- Routine operational matters
- Technical decisions requiring specialized expertise
- Time-sensitive but low-risk administrative actions
Implementation Concerns:
Veto Threshold Critical: The proposed 1-2M UNI threshold appears too low, potentially enabling griefing attacks by a single delegate. We recommend a higher threshold of 5-8M for meaningful veto protection. This threshold should correspond to requiring roughly 3/15 top delegates to veto a proposal.
Scope Limitations: Optimistic governance should explicitly exclude treasury allocations/budgets above defined thresholds or legal/regulatory decisions with broad implications.
We’d appreciate a deeper analysis of which flows should first roll out optimistic decision-making and what guardrails should exist to prevent exploitation.
Conclusion
The UAC has identified genuine challenges facing the DAO. FranklinDAO believes that the path forward should prioritize proven mechanisms and incremental improvement over experimental systems that introduce new risks. As such, we believe that strengthening the existing treasury delegations, enhancing current infrastructure through expanding the use of forums, and a phased roll-out of optimistic governance is the right path forward.
This strategy addresses immediate quorum challenges while maintaining the security and quality standards essential for governing Uniswap. We look forward to continued dialogue between the community and the UAC and stand ready to support proposals that advance these principles.