Decentralizing Governance: The Potential of DAOs in the Divi Ecosystem

Today we explore the topic of decentralized governance and propose how we can bring it to the Divi ecosystem. The traditional centralized model may no longer be the most efficient way to make decisions or even the best we can do as social humans. The rise of Decentralized Autonomous Organizations (DAOs) has brought with it a fresh approach to decision-making that puts the power in the hands of the community. Through a decentralized voting mechanism, every member can have a say in the process of deciding what will and won't get done in our ecosystem. This leads to a greater diversity of ideas and expertise. Join us as we dive into the exciting world of DAOs and discover the potential they hold for more inclusive and effective decision-making.

Implementing a DAO structure for governance is a natural next step for the community of the Divi Project as it aligns with the project's vision of community-driven and decentralized decision-making. By leveraging the power of the Divi community, Divi can create a more transparent, accountable, and efficient governance model that can help to foster greater trust and confidence in the project, which is essential for the project’s long-term success.

When a new DAO is created, the first proposal that is presented to the community is typically the proposal for how the voting and governance model will work. This proposal sets the rules for how the community will vote on future proposals and make decisions on the direction of the organization. Thus, if the proposal is approved, it becomes the governing document for the organization, and all future proposals will be subject to the rules and procedures outlined in the proposal. This ensures that the community has a clear understanding of how decisions are made and how they can participate in the decision-making process.

The following proposal outlines a framework for a potential governance model for the Divi DAO. It is important to realize that the things outlined in the Governance and Voting Proposal will not all be immediately available if this proposal is approved and would be implemented in stages that will require additional DAO voting.

Governance and Voting Proposal #1:

Two separate ERC-1155 tokens will be created for proposals and voting:

1. Divi DAO PROPOSAL NFT - Cost TBD
2. Divi DAO VOTING NFT - Cost TBD

The eDIVI spent to mint the PROPOSAL and VOTING NFTs will go into a DAO Treasury and will be used to fund future proposals. Users can only use one of each NFT per wallet and holding more of than one these tokens serves no purpose.

Submitting a proposal to the Divi DAO:

1. Persons submitting a proposal must hold 1 Divi DAO PROPOSAL NFT in their wallet. This token will not be spent to submit a proposal but must be held in the wallet connected to the DIVI DAO site where the proposal will be submitted. Until the end of the voting period, the person who bought the NFT must have it in their wallet.
2. Persons submitting a proposal must have a minimum balance of 1 eDIVI in their wallet. The eDIVI held in the wallet will not be spent but must be held in the wallet connected to the DIVI DAO site. Holding more than 1 eDIVI token will not affect your proposal in any way.
3. Persons submitting a proposal must adhere to the following vote settings:

• Voting delay = 0
• Voting Period = 168 hrs (7 days)
• Voting Privacy = Shutter - Choices are encrypted and only visible once the voting period is over

When proposals are submitted, Discord admins will create a discussion topic for each proposal in the #divi-dao discussion channel in the Divi Discord server. Eventually, this process will be automated.

Voting on a proposal in the Divi DAO:

1. Voters must hold 1 DIVI DAO VOTING NFT in their wallet. This NFT will not be spent to vote on the proposal but must be held in the wallet connected to the DIVI DAO site where the proposal is being voted on until the end of the voting period.
2. Voters must have a minimum balance of 1 eDIVI in their wallet. The eDIVI held in the wallet will not be spent but must be held in the wallet connected to the DIVI DAO. Voting power is equal to all voters and will not be weighted based on any higher eDIVI balance. Holding more than 1 eDIVI token will not affect your vote in any way. One wallet = one vote.

If Governance and Voting Proposal #1 is approved, there are some additional milestones that can be loosely followed:

1. Additional DAO proposals to be voted on by DAO members

• Validation will remain 1 eDivi

1. Implementation of the governance model

• NFTs for proposal authorship
• NFTs for voting rights
• Manual creation of Discord threads matching proposals
• Wallet for DAO treasury created. First custodial, then put into a smart contract
• Manual assurance of author/voter-NFT relationship

1. DAO Improvement #1

• Requires a proposal
• Move Discord thread creation to automation

1. DAO Improvement #2

• Create smart contract for accepted proposal funds disbursement
• Possible move off Ethereum to Polygon
• Oracle assuring Author and voters maintain their NFTs
• Possible move off Snapshot to a custom platform to better implement automated governance.

Between the time of the approval of the governance model and its actual implementation, there may be additional votes on things like NFT designs, costs, etc. Until the gov structure has been approved, and we create a custom solution for our governance, we will continue to use the Divi DAO Snapshot site for proposals that come from the Divi DAO.

Initially, the DAO will have its own treasury and approved Divi DAO proposals will be community funded. Ultimately, some funding will come from the Divi Foundation Treasury into the DAO wallet. The proposals at that time will receive funds that have been submitted by the both the community and the Foundation. Eventually, the DAO could even make proposals that operate the actions of the Foundation itself. Won’t that be an exciting time?

How to vote:

The voting for Governance and Voting Proposal #1 will begin on Sunday, Mar 19, 2023, at 12:00 PM EST on the Divi DAO Snapshot site.

‍IMPORTANT: A snapshot will be taken on March 19th at 12:00 PM EST. Users wishing to vote MUST join the Divi DAO site and connect their wallet holding eDIVI BEFORE the Snapshot occurs.

At that time, the Proposal will be posted on the DIVI DAO site, and voting will commence. In the meantime, review the copy of Governance and Voting Proposal #1 posted above. In order to vote on the Governance and Voting Proposal you will only need a minimum balance of 1 eDIVI. Having a higher balance of eDIVI will not change your voting power. Voting ends Sunday, Mar 26, 2023, at 12:00 PM EST.

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