Low risk all around, I’m in support.
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Thanks @eugene for sharing the summary.
Given it’s a rather time critical proposal, I endorse the proposal as well (with the mechanism @connormcmk suggested, meaning distributing equally between delegates until October).
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The following reflects the views of L2BEAT’s governance team, composed of @kaereste, @Sinkas, and @Manugotsuka, and it’s based on their combined research, fact-checking, and ideation.
A very similar proposal recently appeared in the Uniswap DAO, to which we are also delegates. As our stance is the same, we wanted to share our thoughts here. Our thoughts on treasury delegation are also relevant to our view on the delegate accelerator proposal, or at least the part suggesting delegating voting power from our treasury to the trained delegates.
We are generally opposed to delegating tokens from the treasury, especially if that voting power is given to already active delegates solely to avoid difficulties in reaching a quorum. While we understand the frustration of needing to rally multiple stakeholders to achieve quorum, this reality in DAOs is a feature, not a bug.
There are multiple reasons why we are against the idea of treasury delegation:
- There is a significant conflict of interest, as existing delegates are voting to delegate voting power to themselves.
- Existing delegates derive their voting power, in whole or in part, from the token holders they represent. That means token-holders can, at any time, re-delegate their voting power away from delegates who no longer represent their interests or are no longer active. By using the treasury to delegate voting power, we circumvent that whole dynamic.
- While the premise is that the additional voting power will assist in achieving quorum, there is no way to ensure it is only used in cases where quorum is difficult to achieve, at least not with the proposed approach.
- While the governance risk is similar to that of reducing quorum, delegating from the treasury creates extra overhead and additional risk. If we are to accept the governance risk, then reducing the quorum is a more straightforward option.
While the above proposal is similar in concept to the one in Uniswap, it is wildly different in terms of the proposed amount to be delegated (~75% of quorum in Scroll vs. ~37,5% in Uniswap), which is also a big reason why we’re against the idea. So far, we haven’t had a proposal that failed to meet quorum. Artificially increasing the available voting power to more than 175% of the quorum to mitigate a problem that currently does not exist does not seem sensible or warranted.
Furthermore, the proposed breakdown poses a problem that is apparent if one takes a quick glance at the numbers. Essentially, we’d be evening out the voting power difference in the smallest ~35 delegates, bringing them all to about ~50,000 voting power. While we get the premise of where the proposed distribution comes from, and we certainly wouldn’t want to see bigger delegates get even bigger, we’re skeptical of the fairness of the approach and the dynamics it would create.
Alternative Approach
Since we don’t want to just say that we’re against an idea, but rather work on finding alternatives as well, we’d like to propose a different approach for consideration, at least on a high-level - details can be figured out.
If the problem that ignited the conversation was fear of being unable to reach quorum in the future, then we could establish a mechanism to mitigate that, without arbitrarily giving more voting power to delegates.
We could draw inspiration from Optimism’s anti-capture commission (ACC) and establish a multisig that has a fair amount of voting power delegated to it. That voting power could be mobilized to only vote in proposals that are failing to meet quorum, but are not generally contentious. The exact details can be figured out collaboratively, but it could look something like this:
- A 2/3 multisig controlled by the Foundation and two delegates.
- Only votes if a proposal has met a minimum amount of quorum (e.g., 75% of the actual quorum).
- Only votes if a proposal is not contentious (measured as a percentage of ‘Against & Abstain’ votes vs ‘For’).
Again, the exact details can be figured out; this is an illustrative example.
In this way, we wouldn’t mess with the existing dynamic between token-holders and delegates, we wouldn’t increase governance risk, we wouldn’t unilaterally empower delegates, and it would significantly reduce overhead.
Alternatively, and given that proposal execution still has to go through the Security Council, we could revisit the topic of slightly reducing the quorum. In our minds, this is still better than increasing the votable supply by delegating tokens from the treasury.
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We appreciate all of the suggestions for alternative approaches to treasury delegation provided but ultimately we echo @Sinkas sentiment here. We feel this proposal raises more issues than it solves, calls into question the premise of delegated voting, and as there hasn’t been a single proposal that has failed to meet quorum we do not believe this is a pressing problem.
We would be supportive of an ACC style multisig which can help avoid non-contentious proposals failing to meet quorum whilst avoiding the multiple issues that arise from treasury delegation.
Thanks for putting this together and for iterating on the feedback from the community.
I’m in support of moving forward with an equal distribution of voting power among qualified delegates.I think this strikes a good balance between simplicity and fairness without trying to force everyone to arrive at the same total voting power.
The goal here isn’t to artificially flatten existing delegate power, but to ensure quorum resilience and broader engagement.Keeping it straightforward will also make the program easier to execute and track transparently.
If this passes the program must have a public post-mortem in October with clear data to justify conclusion or extension.
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We support the initiative outlined by @Sinkas and the L2BEAT governance team, and we echo their reasoning for opposing treasury delegation.
In our view, using treasury-held tokens to temporarily inflate the votable supply is a short-term solution that risks distorting the core delegate-token holder relationship. It may alleviate quorum concerns in the immediate term, but it introduces governance risk and undermines the organic incentives that drive active participation.
Sinkas’ alternative is far more aligned with the foundation’s role in stewarding governance responsibly. It provides a mid-term safety net without compromising delegate accountability or introducing undue centralization.
Looking ahead, we are also working on a long-term proposal to improve the delegation process through staking mechanisms. We believe such a system can strengthen alignment between token holders and delegates while increasing resilience and voter participation. We’ll share more details in a dedicated thread soon.
Thank you all for the thoughtful contributions and comments!
We acknowledge and respect the skepticism regarding treasury delegation. We also appreciate the clarity from others who see value in equal distribution.
Couple of thoughts and questions below:
Thank you for sharing your perspective. It’s worth noting that the intention here is to proactively address a potential issue before it becomes a precedent. Given that recent votes have only narrowly passed - and that the community previously rejected the idea of lowering quorum - the concept of adjusting the votable supply was proposed as an alternative.
I’m also curious to hear your thoughts on how we might define “non-contentious” proposals in a way that’s both quantifiable and easy to automate or verify.
That’s a fair concern, and I completely agree that preserving the dynamic between token holders and their chosen delegates is core to a healthy governance system.
That said, the proposed voting power adjustment mechanism was designed with monthly activity checks built in. If a delegate who received additional delegation became inactive or failed to vote, their allocation would be recalled and redistributed to other active delegates. The intention was not to bypass accountability, but rather to strengthen quorum resilience while still prioritizing active participation.
Thank you for sharing concrete examples from other ecosystems - it’s helpful to hear those insights.
A couple of questions here to all :
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Beyond membership rotation, what mechanisms could help bring in non-delegate stakeholders - such as Citizens’ House members in the OP ecosystem - to broaden the range of perspectives informing the ACC’s deliberations?
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In the Optimism ecosystem, it appears that the ACC operates without a formal budget and is instead recognized as a meaningful contribution through the RetroPGF process. I’d be curious to hear your thoughts on whether this approach is effective or sustainable.
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By reading through the discussion - it seems that while
“since the Start of S6, the votable supply has increased by 18.5%, from 89.4m OP to 106m OP”, some community members attribute that to other unrelated factors such as airdrops, grant delegations, etc. Curious to hear your thoughts on this.
Overall, I’d like to clarify that the votable supply adjustment proposal was always intended as a temporary fix, not a long-term governance model. Even if we were to transition toward a more structured alternative like the ACC, it would require time, coordination, and dedicated resources - making it more suitable as a long-term solution rather than an immediate intervention.
Looking forward to the discussion today as we have two Weekly DAO & Governance Calls.
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Strongly believe this is a great move because it distributes voting power and ensures that it’s not disproportionally captured by top 5% delegates(like in most DAOs).
I do believe that the formula could be improved as it seems to distribute VP to delegates that have under 1000 SCR delegated to them, personally I have nothing against anyone, but it’s peculiar to be a delegate, put in work and get less delegation than a delegate that hasn’t done the minimal effort to buy at least 300$-1000$ worth of the token from the ecosystem they supposedely support.
Certainly, there is a mathematically optimal model here that can be explored.
Also, a strong signal that could be take into consideration when distributing VP could be
-if delegate participated into the drafting/ideation of a past proposal
-if delegate participated into the drafting/ideation of >1 past proposals
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While the activity checks would address the point of a delegate becoming inactive, it doesn’t change the fact that the dynamic between token-holders and delegates is skewed. Using voting power that is given from a token holder to delegate voting power from the treasury to oneself is basically circumventing the soft power that token holders have over the delegates they’ve chosen to delegate to.
There’s no actual need to broaden perspectives. The setup I suggested would be mobilized only to vote on proposals so as to help reach quorum, not to express the opinion of the members comprising it. Since ‘Abstain’ counts towards quorum, the ACC like setup could just vote ‘Abstain’ in all proposals.
We’re generally cautious of retroactive reward schemes as they can get pretty messy to navigate. We could introduce a small compensation to the members in the multisig to reward their activity and make sure they’ll carry out their duty of voting ‘Abstain’ (as mentioned above) in each vote. It’s more of an execution thing, rather than something that requires thought and deliberation.
It is not straightforward to attribute an increase in votable supply to one thing in an ecosystem that has multiple different running initiatives that could affect it. And as we all know, correlation does not equal causation. We do not have more concrete thoughts to share on this at this time.
Pretty much anything other than an organic increase in the votable supply and participation in governance is a temporary measure. Delegating from the treasury to a number of different delegates would also require time, coordination, and dedicated resources. And I believe that it would create more overhead than simply delegating to a multisig controlled by the Foundation and 2-4 delegates.
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It makes so much sense economically to distribute votable capacity, if not for the more eyes on board, then for the chance to bring fresh ideas and keep decisions flowing if and when required and on time. lg!!
At Ethereum Argentina, we share a similar view to L2BEAT regarding the reasons why we disagree with using treasury funds to increase the representation of the delegate set.
First, it creates an agency problem regarding the delegate’s incentives—whether they are truly representing token holders or stakeholders, or simply themselves. Increasing voting power without actual representation leads us down a path where delegates accumulate power without necessarily bearing the responsibility to align with the best interests of the token they represent.
Secondly, it dilutes the only current reason I might have to hold SCR: the ability to influence the protocol’s ownership and governance. The token represents the power to approve changes to the technology and to decide on the DAO’s treasury spending. When deciding whether to acquire or hold this token, an investor—among many factors—considers the supply and the ability to have a voice or influence decisions through voting power. This measure undermines the incentive to hold the token, as it would involve issuing new tokens that dilute that voting power without bringing in new stakeholders who are aligned with the ecosystem’s success or who have real skin in the game.
For these reasons, we are against this initiative. That said, if the discussion were to move forward, we would support an alternative like the one proposed by @Sinkas and L2BEAT: a body or that votes “Abstain” to help reach quorum in proposals where it’s not being met and its non contentious. However, we do not see this as an urgent need at the moment, given the level of control the Foundation currently has over the governance process.
Hello all, judging from the recent Scroll DAO Delegate Accelerator Proposal voting action, it is a very clear there is an obvious justification for a Votable Supply Adjustment.
Looking at the voting profile, it is very evident that this proposal just broke quorum at the last minute, largely from the last minute movements of a high powered delegate and a small number of follow on votes.
If that singular vote hadn’t come in then this vote would not have passed, leading to a prolonged process of trying to coordinate delegates again for another vote. A non-quorate vote is not a decision. It is standard governance in non-quorate events, to re-vote / re-convene by default.
To avoid future coordination failure and making an already painful process, more painful for everyone it is very clear that an intervention is required.
As to whether, that intervention attempts to decentralise the delegate set further and reshape the power structure of the DAO is a far more interesting conversation.
A few position points (these are just my opinions):
- it makes absolutely no sense that the structure of power in these organisations is so highly dependent on who was present and popular at a token generation event.
- there is ample evidence that re-delegation is so rare amongst the delegatees that it should be considered something that does not happen at all.
- given that re-delegation is not an active practice, it is not rational to say that anyone’s delegate stake is “earned” in an on-going fashion.
- we should consider the state of the power structure derived in this manner, which is a borderline arbitrary popularity contest anyway, to be progressively stale the further away from TGE that we get.
- having 2 delegates controlling the third of the power in this DAO, whoever they are, is a bad state to be in and is clearly a site of centralisation.
- given the state of DAOs currently (barely any are alive, let alone high functioning), we can consider that there is much work to be done on improving their governance capabilities and function.
- foundations and DAOs should take a far more active and curatorial approach to shaping their delegate sets.
Personally, I would be in considerable support of not only an active intervention here, but also one that radically decentralises the power structure in the DAO. The delegate accelerator proposal is a good example of how a pipeline towards a new power structure could occur and potentially one that is shaped by merit (evaluated performance on a curriculum and demonstration of governance knowledge). I think the algorithmic approach outlined in the initial proposal looks very sensible and should be done, but I think it would be totally fine for the foundation (or the DAO) to take action much more directly (they are effectively in sovereign control of those tokens as they unlock, I don’t see why not), to delegate significant stake to up and coming Scroll app founders for example.
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Event Horizon has proposed an alternative solution:
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3 Options
So it seems there are roughly 3 ideas now (in no specific order):
- Equal distribution of voting power to qualified delegates (can be tiered or not).
- Drop quorum by a fixed amount (e.g. 500k).
- ACC style solution - create a wallet with some amount of SCR delegated (e.g. 500k) that auto abstains, just to help hit quorum.
The latter two are much easier operationally, with dropping quorum being by far the easiest (a one time change). The third idea (creating a wallet that always abstains its voting power) requires a minimal amount of time each month. Doing an equal distribution would involve the initial exercise of distributing the voting power, then monthly data reviews, and then un-delegating the tokens at the end of the window.
I see the next step as getting some kind of vote in place to get a sense check of what delegates are thinking.
Given we don’t have snapshot in place, we are exploring what we can do on a very short notice. If we don’t find anything better, we’ll either use a form, put into a sheet, add weightings and share results, or put a poll here and weight them manually as well. We’ll let you know once it’s up - hopefully on Friday May 15 and will run through Tue May 20 afternoon EST.
Responding to other comments
If delegates prefer to have a higher bar, we can definitely raise the qualification criteria.
Same goes for this, happy to go with what feels best. I do see a benefit in trying to include those who might have little delegated but have been contributing. But I see the counter argument as well.
Appreciate you starting the discussion on this idea, though we recognize you’d rather focus on decreasing quorum.
While I’m personally in favor of exploring such decentralizations of power, I’m not sure this is the best way to do it (in terms of making that a fundamental part of this initial voting supply issue). I’d be keen to think of ideas relating to delegation awards for significant contribution or other mechanisms to give more voice to those who are able to help grow and sustain the Scroll ecosystem. Keen to hear what others think and we’ll see how the offchain vote goes.
Will read it through and reply there.
From our perspective, we believe it makes the most sense to strike a balance between distributing voting power in a way that balances interests and also ensures that we do not fail to reach quorum.
From our side, we would propose adopting the point system proposed by @DonOfDAOs
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My comments have been expressed elsewhere including on a couple community calls but I would reiterate a few points.
Delegation from the treasury is no different than simply lower quorum by that same amount. So what are the reasons against lowering quorum?
First, it sets a bad precedent. If quorum can be easily changed, it fails to serve as a meaningful security measure in the first place. If a proposal fails to meet quorum, we lower quorum, and then try again, this entirely defeats the point of quorum.
Second, this is a temporary bandaid for a larger systemic problem. If the votable supply continues to decrease, which we have just seen a decrease of over 500k SCR, what then? Do we lower quorum further or delegate more from the treasury? Anticipating this cycle, we should seek to instead find some way of enticing actual token holders to delegate their tokens. This further serves as an accountability front for those delegates as they have to express the interests of their token holders, unlike with treasury delegations. Event Horizon has proposed an alternative solution that isn’t temporary, brings sidelined tokens into governance, rewards active delegates, offers yield to SCR token holders, and leverages the stickiness of delegation to be a durable solution.
I do, however, like the idea of rewarding active delegates in some way. A DIP program seems like a better way of reaching these aims. I also want to express appreciation for the diligence and level of detail put into the above proposal. It’s a step in the right direction even if the final implementation doesn’t solve the root issue as far as I can tell.