[RFC] Principles for Uniswap DAO

[kfx]

Preface

This request for comments introduces a potential set of principles (the Principles) for the Uniswap DAO. The draft Principles were written by Atis (independent delegate) and Erik (Avantgarde Finance). We gratefully acknowledge the comments and suggestions from Erin (Uniswap Foundation), Juanbug (PGov), and other community members.

The main goal is to document and formalize the current shared understanding of the guidelines, checks, and aspirational goals of the DAO and its delegates.

The expected benefits are twofold:

1. Provide guidance for well-intentioned delegates, especially new delegates. The idea is to align and optimize their engagement in the DAO, by nudging them towards commonly shared goals and practices.
2. Help to protect the DAO against potentially harmful or suboptimal actions by assisting in recognizing and evaluating such actions, especially when there’s some ambiguity.

As of now, the Principles are presented as non-constitutional and non-binding. In other words, they do not alter Uniswap’s governance process, and delegates are free to choose whether to follow them based on their own judgment.

However, in the future, there is a potential to integrate the Principles more deeply into the DAO, including the following aspects:

1. Delegate rewards program
2. Treasury delegation program

A detailed discussion of these plans, as well as any enforcement mechanisms, is beyond the scope of this proposal. Integrating the Principles into any DAO program, such as the ones mentioned above, will require separate voting, likely as part of the voting process for those programs.

If the overall feedback is positive, the Principles will proceed to a Temperature Check vote. In the meantime, feel free to provide any suggestions for improvement.

Uniswap DAO Principles

The delegates agree to recognize the following principles and let them guide their decision-making in Uniswap DAO governance:

Processual Principles

• Scope. The purpose of the Uniswap DAO is to govern the Uniswap protocol [1]. This includes protocol parameters adjustments and fund allocation to foster the growth of the Uniswap protocol [2].

• Process. The Uniswap DAO follows the governance process [3] as outlined in the Uniswap Docs and on the Uniswap Governance Forum.

• Onchain Focus. The operations of the DAO should focus on on-chain assets, and key decisions should be recorded onchain to preserve transparency at both operational and governance levels [4]. This includes maintaining on-chain voting as part of the governance process, as is currently done, and using on-chain transactions to transfer funds.

Conduct-Related Principles

• Disclosure. Conflicts of interest should be disclosed clearly on the delegate description page and, whenever relevant, in forum discussions and in the voting rationale. Severe conflicts of interest that could undermine the integrity of governance must be avoided. If a proposal includes specific actions, such as requiring delegates with conflicts of interest to abstain, these directives must be followed. In cases of doubt, delegates should err on the side of transparency and openness [5].

• Security. Given the systemic importance of the Uniswap protocol to DeFi and the size of the DAO treasury, delegates must carefully consider security when making decisions. They should follow established processes to securely and effectively deliver products to the ecosystem, and vote against proposals that expose the protocol or treasury to risks. In ambiguous cases, the proposer must demonstrate the proposal is safe. However, delegates are not accountable for failing to anticipate all indirect consequences of a proposal.

• Legibility. To maintain the integrity of the governance process, rationales for votes should be published in a manner that is understandable to the broader community. Proposals and their reasoning should be clear to outsiders, even those unfamiliar with the history of DAO votes or without access to side-channel communication between delegates. Concrete data and empirical evidence should be included to back decision-making when available.

• Good Faith. Delegates should act with honesty and integrity when participating in governance, and vote in accordance with what they believe is in the best interest of the Uniswap protocol.

• Due Care. Delegates should conduct a professional review of each proposal prior to voting, and are advised to abstain from voting when unable to conduct the necessary diligence to understand a given proposal

• Public Feedback. Delegates should inform the community if they consider that a proposal is superficial, light, unclear or unsubstantiated and needs to be improved or deepened before it is submitted to a vote.

Structural Principles

• Decentralization. Decision-making in the DAO should remain decentralized in all forms, with the aim of keeping the DAO credibly neutral, censorship-resistant and resilient against capture by any single group of aligned actors, whether internal or external [6]. Delegates must prevent the formation of cartels and ensure that the protocol is protected from any proposals driven by personal motives that do not align with the protocol’s best interests.

• Representation. Delegates primarily represent UNI token holders, however, delegates should make a reasonable effort to understand the arguments from all potentially affected stakeholders when making decisions and be respectful of differing viewpoints.

• Accountability. Delegates are accountable to the Uniswap community and should show a willingness to communicate with affected stakeholders, remain open to scrutiny, and, where possible, communicate key rationales to maintain trust through transparent decision-making processes.

The terms “should” and “must” in the text are expected to be interpreted following the Internet Engineering Task Force (IETF) guidelines [7].

References

[1] Uniswap Overview: Protocol, Interface, Labs. https://docs.uniswap.org/concepts/overview4
[2] Introducing UNI. https://blog.uniswap.org/uni#community-treasury
[3] Devin Walsh. Community Governance Process Update [Jan 2023]. https://gov.uniswap.org/t/community-governance-process-update-jan-2023/19976
[4] The Law Commission (United Kingdom). Decentralised Autonomous Organisations (DAOs): A Scoping Paper. Section “Common Philosophical Goals of DAOs.” https://cloud-platform-e218f50a4812967ba1215eaecede923f.s3.amazonaws.com/uploads/sites/30/2024/07/DAOs-scoping-paper-110724.pdf
[5] [RFC] Delegate Code of Conduct. https://gov.uniswap.org/t/rfc-delegate-code-of-conduct/20913
[6] J Austgen, A Fábrega, S Allen, K Babel, M Kelkar, A Juels. DAO Decentralization: Voting-Bloc Entropy, Bribery, and Dark DAOs. https://arxiv.org/abs/2311.03530
[7] S. Bradner. Key words for use in RFCs to Indicate Requirement Levels. RFC 2119, IETF. https://datatracker.ietf.org/doc/html/rfc2119

[Doo_StableLab]

We do agree that having principles and such delegate code of conduct can be important. Look forward to give further comments

[_JoJo]

This is an interesting set of statements.

Is difficult to not agree to them, so i won’t specifically comment on them one by one. But, to me, seems like they could (should?) evolve over time in a constitution. Which is something that over time could help better segment the foundation vs the dao vs the protocol.

[SEEDGov]

We think this is a very good start, and we would like to propose adding some more items to the list of principles and guides for delegate decision-making in the governance of the DAO Uniswap:

• Delegates should analyse each proposal professionally, without falling into superficial analysis or voting according to majority sentiment, and in this regard should provide constructive feedback to third party proposals, asking questions to resolve unclear or doubtful questions.
• Delegates should inform the community if they consider that a proposal is superficial, light, unclear or unsubstantiated and needs to be improved or deepened before it is submitted to a vote.
• Delegates must not become carterised and must protect the protocol from other delegates who make proposals only for personal gain but which do not serve the protocol.
• Delegates should answer questions and queries that may be raised about their own proposals as fully as possible in a clear and reasoned manner, and be prepared to improve, expand or modify them in response to feedback or questions received, without becoming defensive or offensive in response to questions or queries that may arise.
• Delegates should always show respect for others, accept opposing views and avoid personal attacks.

Of course, these points could be rephrased or summarised, but we believe they are important points to consider when regulating the expected behaviour of delegates.

[jengajojo]

I generally support having these types of documents to provide clarity for delegates and the community at large. I understand that enforcement is beyond the scope of this post, however, I would like to urge the authors to restrict further developments about enforcement in a way which minimizes admin overhead. Two concrete ways to do this is to divide the enforcement into two categories:

a. Enforcement via the free market for delegation: This should include ‘must’/‘should’ statements which delegates must follow and do not need admins to calculate or debate over if a delegate is abiding by them or not.

b. Enforcement by platform admins: This should include abusive language or imagery and general behaviour which can be constituted as ‘spam’. Admins of such communication channels such as telegram, discord, discourse should be given the authority to remove such posts and in sever cases delegates who demonstrate such behaviour.

I’d also advice thinking about consequence such as temporary or permanent bans from communication channels for repeated or sever violations.

Further, the authors can consider the following points:

• Delegates should commit to continuous learning about the protocol, its developments, and the wider blockchain ecosystem. They should stay up to date on relevant technological, legal, and economic trends that could impact governance decisions.
• Delegates should prioritize the long-term sustainability of the protocol over short-term gains.
• Delegates should aim to work collaboratively with other delegates, even when disagreeing on specific issues.

I also support inclusion of these points:

@SEEDGov

Delegates should always show respect for others, accept opposing views and avoid personal attacks.

@SEEDGov

Delegates should analyse each proposal professionally, without falling into superficial analysis or voting according to majority sentiment, and in this regard should provide constructive feedback to third party proposals, asking questions to resolve unclear or doubtful questions.

[kfx]

Hello all,

I will reply to some of the points raised in the comments by @_JoJo @jengajojo @SEEDGov .
@justErik will have some of his own comments later.

1. The big picture view.

To clarify, the intention of these principles was to fall somewhere in-between a full constitution and a Code of Conduct (CoC).

A constitution would be binding for all delegates, while the principles are opt-in, and so can be more flexible. I know that there’s some hesitation to formalize a constitution of Uniswap DAO at this point. For one, the regulatory environment is still very unclear.

As for CoC, it typically is a kind of bare minimum. There is an already existing Delegate Code of Conduct, which is an opt-in. Our intention was not to fully replace it. (Although seeing there’s quite a bit of overlap, so it can be debated.) Additionally, the governance forum already has some means of flagging and remove spam messages or personal insults. The principles are meant to be something more thought-provoking and specific to the DAO, not just “don’t spam in the forum”, which goes without saying.

2. Specific additions.

I’m of the view that it’s important not to ask too much from the delegates. (We’re open to removing points from the proposed list of principles as well, if that wasn’t clear!) If we put too many “nice to have” things in there, not only the principles will be harder to understand, remember, and follow. There will be low compliance, which means that any enforcement will be selective at best. I have seen something like that happening in one of my professional affiliations. Selective enforcement (where no-one is fully complying, but only a few are called out for it) is worse than no enforcement.

Proposed additions one by one:

• Delegates should analyse each proposal professionally, without falling into superficial analysis or voting according to majority sentiment, and in this regard should provide constructive feedback to third party proposals, asking questions to resolve unclear or doubtful questions.

  • Would not support, as it’s hard to define what professional analysis means, and not every proposal is within the expertise of every delegate. It’s also not an established practice for every delegate to leave feedback on every third party proposal.

• Delegates should inform the community if they consider that a proposal is superficial, light, unclear or unsubstantiated and needs to be improved or deepened before it is submitted to a vote.

  • Don’t disagree! This could be named something like “Public Feedback” and added to the list.

• Delegates must not become cartelised and must protect the protocol from other delegates who make proposals only for personal gain but which do not serve the protocol.

  • I feel this is already somewhat covered by the “Decentralization” and “Disclosure” principles - maybe you can propose changes in those instead of introducing a new one?

• Delegates should answer questions and queries that may be raised about their own proposals as fully as possible in a clear and reasoned manner, and be prepared to improve, expand or modify them in response to feedback or questions received, without becoming defensive or offensive in response to questions or queries that may arise.

  • This partially overlaps with Representation, Accountability and Legibility principles. Additionally, I think it should not be a requirement that the delegates improve, expand or modify their proposals based on feedback. If a proposal is not satisfactory, the other delegates can simply vote against it. I’d suggest adding something like “should answer questions and queries that may be raised about their own proposals as fully as possible in a clear and reasoned manner” to an existing principle.

• Delegates should always show respect for others, accept opposing views and avoid personal attacks.

  • This is already covered by the existing CoC and seems more like a politeness thing.

• Delegates should commit to continuous learning about the protocol, its developments, and the wider blockchain ecosystem. They should stay up to date on relevant technological, legal, and economic trends that could impact governance decisions.

  • This may be too much to ask especially if we want broad and robust participation in the governance. While it would be great if every delegate was an expert in the protocol and topics surrounding it, it’s important to attract not just the professional delegates, but also aligned actors (like developers, LPs, researchers). The latter may not be full-time delegates, but can still make the governance more robust against malicious proposals.

• Delegates should prioritize the long-term sustainability of the protocol over short-term gains.

  • This was one of the principles that was in the initial list but did not make the final cut. The reason was that it’s hard to quantify what long-term focus means. That said, I do like this principle and if there’s more support, I’m open to reintroducing it.

• Delegates should aim to work collaboratively with other delegates, even when disagreeing on specific issues.

  • Don’t agree that this should be a requirement. What if there are two delegates with two different plans? Should the DAO force them to compromise and collaborate? Moreover, what if someone believes another delegate is malicious, and collaborating with them would be bad for the DAO?

Please keep the comments coming!

[SEEDGov]

Thank you very much for your detailed feedback and we respect the discrepancies you raise, which sound very reasonable!

@kfx

Delegates should inform the community if they consider that a proposal is superficial, light, unclear or unsubstantiated and needs to be improved or deepened before it is submitted to a vote.

• Don’t disagree! This could be named something like “Public Feedback” and added to the list.

We agree with your suggestion.

@kfx

Delegates must not become cartelised and must protect the protocol from other delegates who make proposals only for personal gain but which do not serve the protocol.

• I feel this is already somewhat covered by the “Decentralization” and “Disclosure” principles - maybe you can propose changes in those instead of introducing a new one?

Although it could be understood that it is covered in the two points you mention, we understand that it would be appropriate to include it explicitly as this is a very malicious and misaligned behaviour. It could be included in the “Decentralization” point, we have no objection to that.

[Tane]

Thank you for this proposal that will benefit the DAO! We respect and support these principles. It’s important to define and enforce them for specific programs like the delegation program to keep the integrity of the governance by the delegates aligned with the principles.

We have one question; as @_JoJo mentioned, the scope would change when the governance starts managing new protocols (e.g. Unichain). How would we modify the principles? Another Snapshot?

[justErik]

Thank you all for contributing to the discussion, providing feedback and new ideas. Great to see and much appreciated!

We’ve updated the Principles and included a few new points, you’re more than welcome to leave comments in the doc: https://docs.google.com/document/d/1KK55UQRGOYpndyhNb6aENcNQueHVSC07x9tsYNsY3AM/edit?usp=sharing

[justErik]

@Tane

We have one question; as @_JoJo mentioned, the scope would change when the governance starts managing new protocols (e.g. Unichain). How would we modify the principles? Another Snapshot?

Thanks for engaging @Tane - that seems the most reasonable to do if we need to ratify an updated version. We did discuss using “Uniswap ecosystem” over “protocol” in the principles to address this, but choose not to as there’s some regulatory concerns around the use of the ecosystem term. Eventually when these things become clearer, the Principles could also evolve into a constitution.

[kfx]

Hello all,

There was a brief pause before moving forward with the Temperature Check vote. This was because we want to use Uniday @ Devcon as an opportunity to discuss the principles in person and address any remaining concerns and feedback. Both Erik and I will be there.

One idea I keep coming back to is whether we can somehow incorporate “responsibility towards Uniswap’s reputation and brand” as one of the principles, without placing too much burden on the delegates and while considering that the brand is owned by the Labs, not the DAO. I’d love to hear your thoughts on this, either here or in person @ Devcon.

[AbdullahUmar]

The above principles of due care, good faith, and accountability innately encompass sustaining a strong reputation for the DAO itself. Delegates’ responsibility is to the Uniswap ecosystem as a whole, and largely to token holders, but not explicitly towards Labs. In fact, the DAO/token holder-Labs relationship can actually be conflicting. In an ideal world, the brand would be owned by the community, in which case, we 100% should have that as a principle. But even though the DAO doesn’t “own” the brand, what we do in terms of growth to other chains, for instance, carries the name of Uniswap with it. What we don’t have a responsibility towards, however, is upholding individual Uniswap-branded products that Labs builds on top of the core protocol, like their wallet.

So, I think this principle generally makes sense since we are representatives of the protocol, which is hard to detach from the brand, but doesn’t need to be explicitly spelled out today. Maybe one day the DAO will have brand control (even if by a license)…one can hope.

[drllau_LexDAO]

What mechanisms are in place to adhere/enforce principles?

I can point to many high-sounding desires (sustainable Dev goals or COP) and the failure to actually implement.

From a design point of view, separating the what and how into aspirational vs codes of conduct allows for a shorter (more easily parseable) list whilst having flexible guidelines which are context specific (eg when delegates are co-opted into adjudication/investtigation panels).

[cp0x]

I am not against such principles in general.

They completely coincide with my vision and how I behave as a delegate.
However,

1. Unfortunately, many prohibitions can be circumvented.
2. Currently, delegates already behave accordingly.

That is why I support such behavior, but in fact, nothing will change

[pepo]

While I agree that principles are essential for delegate participation, they cannot and will not be enforceable at the DAO level.

We can establish a code of conduct for the forum (applying to general participants) and define principles for the delegates program (aligned with its incentivization model). However, passing a vote and expecting everyone to uphold these values is unrealistic.

Humans aren’t perfect and can be influenced or corrupted—that’s just the reality. The mantra should remain: Don’t trust, verify — always.

[AbdullahUmar]

True—these aspects are hard to enforce. That’s why the focus of these principles will likely be for participation in DAO initiatives. These principles will determine whether or not including particular groups and individuals into delegate reward and treasury-based delegation programs, along with elections for working groups, is a wise choice. Those who violate DAO-set rules would be less likely to participate in these. At the end of the day, the outcome here is not to pursue legal action against violators, nor should that be the goal. Actors in a DAO should be able to act according to their will, but a lack of decorum may come at a social cost.

[pepo]

If that’s the case, let’s reframe the current proposal as “Policies for DAO Actors” (rather than “Principles”) or something along those lines.

With this reframing in mind, there are still aspects that cannot reasonably be expected of all DAO actors—and that’s completely fine:

• Representation: DAO actors should not be expected to represent every single entity in the DAO equally. Delegates owe their representation to the tokenholders who delegate to them, not to the entire DAO community.

• On-chain Focus: On-chain activity is foundational to a DAO; any critical actions must originate and be validated on-chain. Beyond that initial involvement, off-chain transparency should hold equal value as on-chain transparency—it’s simply another method of communication. We should avoid signaling for unnecessary bureaucracy.

• Decentralization: I would rework this term to focus on anti-cartelarization. Decentralization is already a foundational assumption in the DAO world.

• Security: We cannot punish potential DAO actors for their participation due to a lack of understanding of third-order effects, as long as their actions are conducted in good faith and with due care.

[SEEDGov]

Interesting! We could use this as a participation metric for the next Delegate Rewards cycle. That is, those who complies to these principles will receive “x” number of points, and those who violate them will have those points deducted and thus will be downgraded in the rankings. The same goes for those who want to integrate any workgroup. In this way, incentives create a method of enforcing.

[justErik]

Temp check now live on Snapshot: https://snapshot.org/#/uniswapgovernance.eth/proposal/0xcc5e92fac9d5d9c68bb4f2f742e9e6760c75f7c13a44a02aba33c769505fd2c2

[kfx]

The final version that’s up for the Temp Check vote includes revisions based on comments from PEPO, discussed in more detail in DM. The first post in this thread has been updated to reflect the version put out for the vote.