Uniswap Delegate Reward Initiative - Cycle 3
Authors: @Doo_StableLab @PGov @AranaDigital @seedgov
Summary
This proposal outlines the Uniswap Delegate Reward Initiative—Cycle 3, a compensation program designed to improve and sustain the participation quality and dedication among Uniswap delegates following the conclusion of Cycle 1 and 2.
Background
In late February 2024, StableLab proposed the Uniswap Delegate Reward Initiative. After the GovSwap event in Denver, further research to plan and implement the Delegate Reward Initiative was highlighted, leading to the formation of the Uniswap Delegate Reward Working Group, composed of 8 members from different organizations. After extensive research for more than a month, the Working Group produced several findings, which can be found here: https://gov.uniswap.org/t/findings-from-uniswap-delegate-reward-working-group/23702
Incorporating these findings, the Uniswap Delegate Reward Initiative Cycle 1 was proposed and launched in June 2024. Cycle 1 was successful in that the 12 delegates selected maintained 100% voting participation rate for votes during this period. In addition, several new delegates joined the protocol due to the presence of incentives.
With learnings from Cycle 1, including how to make a points system to determine the top delegate applicants in a more fair and objective manner, along with a tier system to incorporate different participation levels of delegates, Cycle 2 was launched.
Success of Cycle 2
As of January 2025, all 16 delegates in the program have maintained a voting and rationale qualification rate above 85% over the past three months, with 10 delegates achieving a perfect 100% in both categories. Their collective participation is essential; without them, quorums would not have been met.
The program also attracted several participants to become delegates.
Additionally, community calls for Cycle 2 played a key role in keeping governance members informed, averaging 38 participants per call, with paid delegates demonstrating a mean attendance rate of 81.25%.
Learnings/Challenges from Cycle 2
In the most recent cycle, the DAO encountered an unexpected tie for the 15th position, highlighting and opening a discussion about implementing a more robust and transparent delegate incentive system. This situation not only tested the limits of Uniswap DAO’s current framework but also underscored the dedication and quality of the delegate candidates. Below, you will find a revised version of the tie-breaker criteria to prevent the issues encountered with the cycle 2 application.
As was the case with Cycle 1, Cycle 2 provided valuable insights into the program’s effectiveness and areas for improvement. A key success was its enhanced accessibility, which enabled new delegates such as Areta Governance, PEPO, and Ignas to participate. This highlights the program’s ability to bring fresh perspectives into Uniswap’s governance. Cycle 2 also admitted multiple delegates from alternative DeFi ecosystems, introducing a more robust host of decision makers in the DAO.
Additionally, the initiative has maintained a high participation rate among delegates, contributing to more active and engaged onchain governance processes. We have also seen a significant increase in community call participation over the past cycle, showing that an attached incentive associated with monthly calls results in larger audience sizes.
Voting participation remains the most direct and measurable form of governance contribution, leading us to adjust the weighting of different criteria for Cycle 3.
The primary change for Cycle 3 is an increased emphasis on voting participation, particularly onchain voting, which carries greater governance impact. While community participation, such as attending community calls, remains a factor, its relative weight has been reduced to focus more on direct governance actions. Plus, measurement of voting participation is objectively the most straightforward metrics for determining who is contributing to governance. This weight will therefore influence who will be admitted to the program.
For those who are selected into the program, the requirement for rationale submissions remains intact, as it has demonstrably increased forum participation and fostered more discussion among delegates. However, we have not included rationale “quality” or length as a variable for determining compensation. It is possible that the DAO would like to in the future rely on more subjective metrics since they may illustrate a higher degree of substance on forums, but the evaluation for quality on forum posts may lead to an unneeded degree of conflict when determining scores. The current goal with rationales is to simply see the directional thought process behind a delegate’s voting decision.
Cycle 3 Proposal Details
Application Eligibility
- There will be a week-long period for candidates to submit their applications. The top 15 delegates will be determined based on a point system outlined below.
- Delegates from Cycle 2 must apply again for Cycle 3–they will not be automatically included.
- Only delegates who have participated in onchain voting for at least three months prior to the application post are eligible for Cycle 3.
Uniswap Delegate Reward Cycle 3 Metrics
In case there are more than 15 eligible applicants, the top 15 will be chosen by the following objective metrics. The highest number of available points will be 11.
1. Voting Participation
Since a delegate’s primary role is to utilize voting power from delegators and vote in Uniswap’s best interest, active participation is essential to ensuring quorums are met and malicious proposals are thwarted. This category carries a total of 7 points, with onchain voting weighted more heavily due to its ability to directly impact governance contracts and direct treasury funds. The voting rate is evaluated based on the past six months.
Offchain Voting (Snapshot)
90% and above: 3
80% to 90% : 2
70% till 80% : 1.5
60% till 70%: 1
50% till 60%: 0.5
50% or below: 0
Onchain Voting
90% and above : 4
80% till 90% : 2.5
70% till 80%: 1.5
60% till 70%: 1
50% till 60%: 0.5
Below 50%: 0
2. Proposal Authorship
Contributing to proposal drafting for Uniswap DAO is valuable, but maintaining quality and preventing malicious proposals is equally important. As a result, only successfully passed votes are counted. This category is worth a total of 3 points, with onchain proposals receiving greater weight once again.
For non-binary proposals, if a “No” equivalent option was available and the final voting outcome was a choice other than “No,” the proposal qualifies for points in this category. For example, the Uniswap Treasury Working Group (UTWG) Election would not be eligible, as there was no “No” vote option. However, the [Temp] Uni Onboarding Package - BSC would qualify, since an “Against” option was present, and the final outcome was “$1M.”
Authored or Co-authored a proposal that passed offchain (Snapshot) vote before.
Yes, 2 or more: 1
Yes, 1: 0.5
No: 0
Authored or Co authored a proposal that passed onchain vote before
Yes, 2 or more: 2
Yes, 1: 1
No: 0
3. Community Participation
The full point for this category is 1.
Community Calls (attendance for September, October, December 2024 & January - Feb 2025)
Attended at least 80% of calls: 1
Attended at least 50% of calls: 0.5
Tie Breaker
- Ties will be decided by the date of the first onchain vote that these applicants cast in order to reward delegates who have been contributing to Uniswap governance for an extended period. The tie-breaking value will be determined based on the end date of the vote in which the delegates participated, not the onchain date when the vote was cast.
- In the event of a tie with the first tie-breaker criterion, priority will be given to the delegate who has cast the most votes in the last 6 months.
- In the event that the tie persists further, the final decision will favor the delegate who was first to present their delegation platform—hence, priority will be given to the individual/entity who first publicly declared their intention to become a delegate.
Delegate Reward Eligibility
Once delegates have passed the application process, they must fulfill the following requirements to be eligible for up to $6,000 USD worth of $UNI reward per month.
Requirements
- Maintain a minimum of 80% participation in onchain and off-chain voting during the last 3 months to be eligible to receive up to $3,000 worth of $UNI per month, with the proportional payment based on each delegate’s participation in the total votes cast during the last 3 months (number of votes cast x 100 / total votes cast during the last 3 months). For example, if there were 10 votes cast in the last 3 months and a delegate voted on 8 of them, that delegate will receive 80% of the $3,000 USD, i.e. the delegate will be eligible to receive $2,400. If another delegate voted on 7 of those votes, that delegate will not be eligible to receive any rewards as their participation was 70% of the votes, below the 80% minimum.
Additional Rewards (the below are only available if the above Requirement of Voting Participation is fulfilled)
2a. Write rationale for the voting on their delegate profile.
-Deadline for writing rationale would be 7 days from the end of each vote.
2b. Attend Uniswap Community Calls.
Achieving these above will provide an additional up to $3,000 USD worth of $UNI. For 2a and 2b, there will also be proportional payment. For example, if there were 4 votings and 1 community call, and a delegate missed writing a rationale of 2 of the votes, the delegate would be eligible to receive $1800 [3/5 * $3000].
Budget
We are requesting 540,000 [6000 USD *6 Months *15 Delegates ] USD worth of UNI for cycle 3 of the Uniswap Delegate Reward Initiative.
The total amount, once approved, will be sent to the Accountability Committee, which will be responsible for the monthly distribution of rewards to eligible delegates. Since the total budget of the Delegate Reward WG has not been fully used, administration of this reward program–including the creation of this proposal and the admin work behind verifying monthly delegate participation–will be allotted from that account, with no additional costs to the DAO. Therefore, the total budget request will be solely for the delegate pay.