[1RC] 1inch DAO Grants council

2.1 General Proposals
1

Simple Summary

A 6 month trial version of a Grants Working Group to support Ecosystem Development, Research and Analysis projects for the 1inch network.

Abstract

This proposal aims to establish the 1inch community grants working group, focusing on Ecosystem Development, Research, and Analysis projects. The trial version of the program will operate for six months and will be jointly administered by members of the foundation and the recognized delegates.

Motivation

The DAO has tried to allocate funds from the 1inch Community treasury over the past year. This Grant allocation strategy was found not to be as effective due to the following factors.

  • Lack of reporting and accountability from the grant recipients
  • Collective liability protection on the DAO and its members for funded initiatives.
  • The DAO is unable to react in a timely manner to misconduct or failure of delivery by the grant recipients.
  • Lack of accountability/ point of contact for the funds allocated and to be assigned

The proposal seeks to foster the growth of the ecosystem by supporting relevant projects while addressing some of the issues highlighted earlier. It will implement a rigorous approach to filtering applications, which will be assisted by the legal and technical experts at the 1inch foundation. It will also implement milestone-based payments for any approved grant applications. Streaming payments ensure that funds are distributed progressively and can be revoked if milestones are not met, thereby enhancing accountability and reducing risk.

Specification

The proposal establishes a Community/DAO-owned Grants Program with a 6-month duration, operated through a working group of 5 members elected by the 1inch DAO through Snapshot voting. The 1inch DAO will oversee the overall program and will be assisted by experts from the foundation to aid in decision-making and enforcing accountability. The program will have the ability to distribute grants in the following categories:
Research and Analysis
Ecosystem Development.

A separate grants category will be created on gov.1inch.io to administer the program publicly. This public platform will allow:
Applicants to make posts about grants

  • The community to weigh in on any requests received
  • The Grants Working Group to announce their decision
  • Approved applicants to post updates on their process
  • A clear and transparent process for administering grants

Grants Working Group:

The Grants Working Group of the 1inch DAO grants program shall consist of 5 members with a multi-sig with the Grants Working Group members as signatories. The main goal behind establishing a Grants Working Group is to conduct a qualitative and quantitative screening of projects, thus ensuring the sustainable growth of the 1inch ecosystem.

Operational Specifications of the Grants Working Group(GWG):
The WG shall have one Steward and 4 Reviewers,

The Steward is responsible for

  • Organising the schedule and ensuring the smooth functioning of the WG
  • Communicating internally and externally about the grants process.
  • Scheduling payments for grantees
  • Approving/rejecting whether the GWG should review any grant application.
  • Accounting expenses and monitoring milestone deadlines
  • Creating a final report on the grants program at the end of the 6 month term.

The Reviewers are responsible for

  • Vetoing approval/rejection decision made by the Steward via a super-majority vote
  • Reviewing all applications in a timely manner.
  • Processing applications and posting feedback for applicants in all internal and external tracking tools and communication channels.
  • Communicating with the foundation experts
  • Assisting the steward with reporting, accounting and other tasks which may require group effort.
  • Hold the program accountable for its goals and objectives

Elections to the Grants Working Group.

The 1inch DAO elects members of the Grants Working Group through a Snapshot Vote. The Grants Working Group members serve a six-month term and can resign at any time by giving one month’s notice. The Grants Working Group is expected to set internal governance guidelines and KPIs and adopt measures to have a transparent environment. The Grants Working Group can not unilaterally change the specifications of the grant process without following the established governance guidelines.
Recalling a Grants Working Group: If the DAO realises that the Grants Working Group or any individual member isn’t fulfilling their duties, a motion to recall the grants committee shall be put in and follow the guidelines established in the proposal lifecycle.

Responsibilities of Grantees

Following the proposal guidelines and governance process of the 1inch DAO

  • Answering questions raised by the community on the forum
  • Communicating promptly with members of the Grants Working Group
  • Follow the legal processes laid out by the 1inch Foundation
  • Posting regular updates on the state of execution of their projects based on predefined milestones and timeline

Responsibilities of the 1inch Foundation

The 1inch Foundation will assist the Working Group with their legal and technical expertise whenever requested.
Genesis Grants Working Group

The Genesis Grants Working Group will consist of five members: three from the foundation and two recognised delegates elected by the DAO. Compensation for all members is included in the existing compensation mechanisms.

The Genesis members will be

The Genesis members will be

  • Grants Steward: DAOplomats LLC - DAOplomats.eth
  • Reviewer: Jordan Reindl, 1inch Foundation – roundelephant.eth
  • Reviewer: Natalia, 1inch Foundation – nattop.eth
  • Reviewer: Kenechukwu Eze, stablelab.eth
  • Reviewer: Belac, 1inch Foundation

Project funding lifecycle

Projects that are interested in getting funded shall create forum post on the 1inch DAO forum under the grants category.
The GWG has a 7 day working days to acknowledge a request of ask the project to provide additional information incase of incomplete submissions. The criteria and method for funding are up to the discretion of the Grants WG.
If accepted for review, the GWG may request additional information and/or documentation from the project before making its decision. The GWG will publicly communicate its decision in reply to the grant request.
If a grant request is accepted, the project must fulfil all the legal requirements laid out by the legal team and publicly communicate the project status according to predefined milestones and timelines. A failure to do so may result in funding being paused or legal action in some instances.

Rational

This proposal won’t significantly impact any of the protocols the DAO manages. It establishes a social committee to make quality decisions on project funding, simultaneously reducing the issues highlighted in the motivation section. The Grants WG will significantly reduce the burden from the 1inch Foundation on grant activities while empowering the community to administer the grant process

Conclusion

If this proposal passes, the DAO will establish a Grants Working Group to assist the DAO in processing grant requests.

4 Likes
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As I just expressed on the Biweekly Governance call, I fully support this proposal! I think we do need to make some of the logistics a little clearer in this proposal. My suggested edits:

  • The $500,000 USDC will be moved sent from the 1inch DAO Treasury to a newly formed 1inch DAO Grants Council multi-sig.
    • I believe this should have a 4-of-5 threshold since it is holding a lot of funds.
    • Alternatively, we can keep the suggested 3-of-5 threshold but we can set up Spending Limits on the Safe so that only a few thousand dollars can be spent in a single day. This is my personal preferred approach.
  • Since the Grant lead is paid a salary, we should set it up via a Superfluid stream (similar to what we did with the RD compensation).

  • The compensation can be paid in lump sums every season or on a monthly basis from the DAO treasury.

    • I think it makes more sense for the compensation to come out of the program’s budget and multi-sig since all funds leaving the main DAO treasury require a cumbersome vote. Monthly payments would give the DAO a more transparent view of the real-time costs of the grant program.
  • I think the DAO should have the option to cancel the grants program at any time via a normal governance vote. If this happens then no further funds should be sent except for making good on outstanding milestone deliverables. The remainder of the funds will then be sent back to the DAO treasury (this might take a few weeks if the Safe has Spending Limits enabled).
  • Is the $20,000 limit applied per a grant milestone? Or per a total grant amount? I assume it is the latter, so we may want to also have a maximum milestone unlock amount of like $10k (which would also be the daily Spending Limit for the Safe).
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Hi – I’m Meg from Grants Stack @ Gitcoin. Love to see this proposal and really excited about 1inch investing in a grants program.

One thing that’s particularly interesting in this proposal is the model for performance-based compensation for reviewers – first time that I’ve seen this in the industry! It reminds me a bit of the mentor-based model that Urbit uses (reviewers taking up to 20% of the total grants funding in return for being heavily involved in making the project successful.)

I wonder if the 1inch program could test this performance-based model out in a lightweight way – maybe the reviewer fee is split, and 50% delivered with approval and 50% with a completed grant? This could drive accountability without adding too much mentorship overhead.

Again, really excited to see this, and would love to support however we can.

2 Likes
4

Thank you for your feedback @RoundElephant @Meg-Gitcoin The following amendments have been added based on your suggestions.

The compensation for reviewers will be split such that 50% paid upon grant approval and 50% when a grant is completed.
The multi-sig will have a daily spend limit of 10,000 USDC
The DAO can cancel this grants program at anytime by following the usual governance procedure
The payment shall be made via a Superfluid stream

1 Like
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Hey everyone - Lindsey from Hedgey here. Wanted to first say it’s super cool that you’re pushing to kick off a grants program. The outline you shared @jengajojo makes a ton of sense for 1inch.

Sharing a few notes as a follow up to the revocable grants comment by @RoundElephant and offering Hedgey Grants as a solution for the streams + 1inch public dashboard to share the state of grants payouts across the day.

A quick background for anyone that doesn’t know Hedgey
We create onchain token streaming products and over the last two years has worked with Gitcoin, Celo, Collab.Land, Shapeshift, Index Coop, BanklessDAO and other great DAOs to give them access to vesting, lockups, and grant payment systems through our free, public goods solutions. We have over 6000 live streams/lockups and are audited by Consensys Diligence.

In addition to streams (either linear or periodic), Hedgey would give 1inch grant managers a single dashboard (via Safe App) to create, track, and manage every grant in one place, plus a custom dashboard for recipients to track and claim tokens. All done 100% onchain without any log ins or account setup.

We would also give 1inch the ability to generate a custom public dashboard where the status of every grant payout could be automatically shared DAO wide. Here’s a demo of the public dashboard + a quick loom video originally made for Arbitrum showing the product.

To wrap it up, I think Hedgey help out with your grants payouts as you kick things off, plus add extra value for the managers and broader DAO. My TG is @ goforlindsey if it’s easy to message there - more than happy to get involved and support 1inch grants in whatever way is helpful!