[Temperature Check] Create the Uniswap Foundation

Thank you! Yes, we’ve very excited to bring on current community members onto the team, if the proposal passes. Anyone can take a look at open roles and apply today - Uniswap Foundation

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Polygons liquidity mining campaign was worth 20M USD. Initially, no liq. mining campaign happened until community members started urging Mihaylo to live up to his promises.

There are bound to be other examples down the road and if nobody is responsible to take care of these things then the loss will snowball harder than the budget of the UF.

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Nice proposal. It is interesting to have another entity that contributes to Uniswap and helps to shift the balance of power which imo leans too much towards uniswap labs.

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What I don’t understand is who owns the equity in this newly formed foundation? Is it Labs, Devin or someone else?

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I think the OKR’s need to be rewritten both to ensure accountability to token holders and for the foundation to eventually defend itself against skeptical token holders. The primary key result metrics, as I read them, are % allocation of the budget. These could be achieved with the stroke of a pen regardless of the effectiveness of resource allocation. While the proportions are useful to communicate, they are not helpful for evaluation.

It is a bit concerning that they were written this way because it implies that the spending of funds is primary rather than return on investment.

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It would be well within the scope of the UF to welcome, encourage, and provide grants to research and analysis on the fee switch, and to promote better education around the mechanics of fee switch implementation. It would also be well within the scope of the UF to assist the community in decision-making regarding the fee switch, including putting out information regarding any polls or governance proposals regarding the fee switch (just as we intend to for all other governance proposals). It’s been awesome to see all the enthusiasm and debate in the forums on this topic and would be excited to do all of the above if and when the proposal passes.

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Great proposal! As a builder in the Uniswap Ecosystem, I believe the foundation is the right approach to grow Uniswap.

I hope you will build a distributed and diverse team so the foundation’s impact can be widespread.

Also, curious going forward about how much visibility the foundation will have on Labs’ roadmap and development. Would that impact on voting and grant decisions (eg: will foundation would vote against a proposal if it knows it impacts Labs’ roadmap?)

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Speaking for Other Internet, we are very enthusiastic about this proposal.

Since last year, we’ve put released 3 comprehensive deep dives into the governance challenges facing the Uniswap community, and are about to release a 4th. In all of our work we’ve consistently identified one issue common to all of Uniswap governance’s various problems. That issue is the lack of a clear center of authority and source of legitimacy.

The outcomes such a party’s absence include:

  • high levels of politicking needed to get anything done
  • voter apathy and delegate fatigue
  • slow operational decentralization
  • lack of accountability in partnerships (more on this in our forthcoming paper)
  • difficulty in improving the governance process

We are supportive of the proposed foundation because we believe it will address these problems, not only through various initiatives, but also by simply being an actor with the mandate to be a channel for various stakeholders to connect and get things done. That there are dev relations, delegate relations, and partnership leads roles listed (with job postings already!) is a hugely positive sign for the type of operational capacity and speed that the foundation should unlock for Uniswap governance.

As a side note, I hope this proposal makes clear what I’ve been advocating for in the fee switch conversation. There are a lot of things that need to happen for Uniswap protocol to continue to grow; with or without protocol revenue, the Foundation is the best bet to make those things happen.

TL;DR - Uniswap Foundation is an entity that can represent the interests of the protocol and its various stakeholders. It can scope projects, be a legal counterparty, liaise with delegates and get things done. We simply haven’t had haven’t had this before, and it’s the biggest step we can take toward more efficiency here. Devin and Ken are excellent and have a proven track record, and we are looking forward to working with them on new governance initiatives.

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This is a good question. In order for Uniswap Protocol to become the value exchange layer of the Internet (which we believe it should be), we believe there should be many diverse and talented teams building on it. There are many teams outside of Labs building on the Protocol today (many are listed in the UGP retrospective) however we believe there is a massive opportunity for grants to fund additional ambitious and impactful projects. The governance of the protocol is another key to long term Protocol sustainability that in our opinion requires some reinvigoration - we are excited to work with the community to ensure the governance process is efficient and effective. The UF will build a lean team and have a grants budget focused on exactly these things: Protocol growth, decentralization, and sustainability.

Uniswap Labs is one of many organizations in the Uniswap ecosystem. It built, deployed, and, alongside many other teams, will continue to contribute to and build on the Protocol in the future.

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I don’t disagree. I’m not asking for people to work out of the kindness of their hearts. I am going to question why if that’s the sole goal (which requires a legal analysis) do we need to fork over 14M in operating dollars to build a team of 12. That’s pork and spending for other things. Size it all down and work provisionally. You can come back in 6mo to ask for more.

14M for 3 years for 12-15 people? I dont think its unreasonable. If it were 140M, then yea, but I do not see how this is unfair compensation. The UGP has already done what you mentioned here with the smaller spending. You can check their retrospective out in the post itself.

We aren’t impressed. UGP has been a porky failure. I can’t post links but please see @adamscochran’s Twitter thread on the issue posted a few hours ago.

This is a fair point. Ken and I have went back and forth a lot on the best way to set OKRs. The first set of OKRs we wrote for the UF focused on increased volume, number of new users and developers in the space, number of “high impact, high engagement” governance proposals, etc. These are the results which all of our work would aim to have.

However, we got stuck is defining the “right” numbers to tie to those results- how much volume might increase, when (it might take a talented dev team time to build a high impact new interface), by a % or total cumulative volume, and so on and so forth. Volume is going to be highly influenced by market conditions - how do we know what to attribute to the UF vs the market? New developers and interfaces - does it make sense to measure the number of new interfaces? One interface that stems from a larger grant might have a more positive impact than 5 interfaces stemming from smaller grants. We ultimately decided to set OKRs based on grant allocation % and team focus, and the metrics we will measure grantee success by, because those are the clear inputs to the results above which are within our control.

We also think we might learn more about what numbers tied to those results (volume, # interfaces, etc.) make sense once the UF is up and running for some time (if the proposal passes!). If we do, then it could make sense to adjust OKRs in the future.

That was our thinking in setting the OKRs this way. But, if community members have suggestions on how we might be able to better measure ourselves, we do want to hear them.

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Hi all - Michael from xToken here.

I think this proposal is aligned with the best interests of the Uniswap community, and I also think that this sort of initiative is (directionally) an appropriate use of the protocol’s treasury.

That said, having been through the UGP process, it would be beneficial to hear more about the process and methodology for the grants program under the new umbrella. I found the members of the committee to be kind and well-intentioned, but overall the process was vague and lacking in transparency. I’ve spoken with other applicants who have had similar experiences.

A few notes:

  • I had to backchannel through an investor to get time on the calendar to present our proposal in front of the committee
  • We didn’t receive feedback or any communication on the proposal until about 2 months later
  • The feedback provided for why the committee was passing was plainly inconsistent with the decision to fund other grants in that wave

Because the committee declined to fund our proposal, it’s difficult to write this post without sounding like sour grapes. However, the grant request was really quite small, so I hope I can present this perspective neutrally.

Looking at the list of funded grants over the history of the UGP, the committee has done great work supporting projects around tooling, analytics and ETH public goods. The media and hackathon sponsorships make legitimate sense for the protocol, even if some people object to the price tags. However, it’s hard not to look at the grants list and notice a subset of very generously funded projects with ambiguous goals. In many cases, these projects are led by folks with strong ties to the committee and team. In some cases, these are projects led by committee members (to be absolutely fair, the committee members are not always the beneficiaries of these grants). And, in some cases, these projects have not been shipped or maintained.

I really don’t think there is any ill intent here, and I don’t want to empower any of the trolls on this forum. I also think it’s completely justifiable to run a grants and development program driven by the committee’s network and priorities. However, this approach would seem to be in conflict with the stated ethos of the project and community. And the optics are apparent to everyone except a few insiders.

We’ll still be building on top of Uniswap V3 everyday, and we will definitely apply to the grants program again in the future. But I think the community and protocol – and the foundation -– would benefit deeply from a clear statement of process, methodology and standards.

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Adam´s thread completely disregards facts such as the OP situation or the Polygon liquidity mining campaign which are vital reasons why the Uniswap Foundation should exist to handle such events specifically for the tokenholders.

Representing it as a “porky failure” is a misrepresentation. Is it perfect? No. Did it do more good than harm? Yes. Even Adam said there were worthwhile projects being funded by the UGP. I think the measuring stick is too harsh here as the Uniswap Foundation aspires to be more than what UGP was/is.

The UGP was run part-time by only a handful of people who were working upwards of 40 hours per week+.

When a DAO promises the Uniswap DAO a reward, whose responsibility is it to collect it? Is it you or me? Is it the Uniswap Labs? Whose job is it to handle such things on behalf of the tokenholders? Nobody knows and everybody assumes, “Well, somebody is assigned to do it.” No. There are very few people who are watching these things and its to the cost of the tokenholders. We are not talking paltry sums either.

These situations are going to pop up more frequently in the future and are going to be more costly each time they happen. Major major sticking point in my honest opinion.

Another good reason why the UF should exist is whiteglow support for users when it comes to user generated governance proposals. People are not really familiar with the process of how to implement their ideas into a concrete governance on-chain proposal.

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I do not support this proposal.

Reading through the article, I don’t see a proposal describing how to empower uni tokens and increase the value of uni tokens. As a uni holder, I can’t support this proposal to set up a centralized company purely by selling coins. We call for the commission switch to be turned on.

I remember donating 1 million uni tokens to a defi education group, and honestly, I didn’t see any educational results from the group, but rather like a transfer of benefits. The proposal to set up a foundation this time seems to me to be the same.

Even if a foundation is set up, asking for $70 million is too much now, and the uni token market can’t afford such a dump in the short term.

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Can we get @kenneth to comment on such projects that UGP is failing to budget? I’m genuinely curious to hear what projects are out there to help justify this temperature check! Is the plan to sunset the UGP program eventually?

This is extremely exciting and in my opinion represents a really ambitious step in the direction of further decentralization of the whole Uniswap ecosystem. Kudos to Ken & Devin for creating this proposal.

Some comments:

I think this funding amount is totally within reason. Attracting top talent is key, this work is hard, and the operational budget looks acceptable to me.

I saw some comments below about UGP application times, communication holes, etc and I would just like to remind everyone here that the UGP has been a resource constrained and very grassroots effort up until (hopefully) now. I have worked with Ken on UGP and he is exceedingly competent, and I have every confidence that most of the issues described will resolve with more resources and the ability to hire help.

I am especially excited about the plans to invest in governance stewardship. Creating proposals and passing them is too difficult and I think a dedicated team to provide assistance to would-be proposers will lead to a huge increase in viable governance activity. (ps. Please overhaul the current governance process! I wrote it but now I’m embarrassed by it lol)

Some questions:

  1. The biggest thing that stood out to me was 35% for research on incentive mechanisms.
  • Can you guys go into more detail on what you hope to achieve there and maybe give some more detailed examples of the types of things you want to explore using this funding?

  • Will UF be using funding to provide actual incentives (i.e. some types of liquidity mining programs)?

  • If the answer to the above is yes, what kinds of modeling will you be doing to before funding a given incentive mechanism MVP and will you plan to share the results of modeling with the community?

  • Given that this is the largest part of grants budget, would it be fair to say that the UF thinks incentive scheme development is the largest factor in the future growth of the Uniswap protocol?

  1. What types of candidates are you seeking for 3rd board member?

  2. Is the advisory team permanent or will it roll over periodically as in the current UGP?

  3. Now that Uniswap labs has entered the NFT space via acquisition, will NFT focused tech be eligible for UF grants?

A suggestion:

I think the marketing and events budget looks low. I would like to see the Uniswap protocol begin to market itself in a big way. FTX is out here naming stadiums, but Uniswap logo, branding, mission and ethos is cooler in every way and I think has the potential to resonate with retail. Superbowl commercials. Official sponsor of Paris Fashion week. Headline sponsor of US womens soccer. The olympics. More e-sports partnerships. I would add another $10M to the first year’s budget to test out large scale sponsorships and see if they work for us.

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UniScott - may not be able to come to an agreement here, but I do want to acknowledge and respond to a few of your concerns.

On UGP v0.1, Ken just wrote a response to Adam’s comments here - we’re proud of the success of UGP v0.1, and believe some awesome grant projects came out of it, (some covered here). The UGP team has definitely learned a ton to apply to the next round, if the proposal passes. And, we’re excited about what we’d be able to achieve with a full-time team (v0.1 only had funds to pay a small team part-time salaries, tho many of them still worked 40+ hour weeks).

We think it’s in Uniswap’s best interest to have a full-time team and resources devoted towards 1) funding teams to support Protocol growth, 2) reinvigorating governance, and 3) being an advocate for the Protocol.

A larger grants program and full-time team is more capable of building strong relationships with the most talented development teams, and scoping out the most impactful, ambitious projects which take more time and funds to build. A budget limited by a 6 month timeframe would be limited in its ability to support those kinds of projects, which we see as being integral to Uniswap’s long term success. The UF would also have a team focused on developer relations, community building, delegate relations, improving governance, and more.

Also happy to hop on a call to discuss further - feel free to DM me https://twitter.com/devinawalsh

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This should happen way before. I really agree with this. Let do this fam

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