We’re thrilled announce a new asset allocation experiment: The Conviction Funding pilot.
ANT holders will grant $50k to community proposals through the new Conviction Voting app.
The Aragon community knows well the challenges of on-chain governance. Plutocracy, vote-buying, Sybil attacks, last-minute vote changes, on-chain voter apathy, to name a few. But new tools are emerging to help overcome these challenges. Conviction voting is one such tool. We want the Aragon community to test, understand, validate, and refine the mechanism.
The recent governance explosion makes this pilot especially relevant to the DeFi landscape. Conviction Voting eliminates the governance bottleneck of large distributed communities. DeFi communities could manage on-chain revenues, mint tokens, or run grant programs themselves.
The Aragon Association will fund the Conviction Funding program. This program will be run on an Aragon DAO with a treasury of 9k ANT (currently valued at $60,390). Proposal submissions and voting will start on Thursday, August 27, and end on Thursday, October 8 (6 weeks).
Benefits of Conviction Voting
People with large stakes and strong opinions can’t suppress minority voters
The support a proposal needs to pass is proportional to its budget
The majority doesn’t need to achieve consensus on every proposal
Token holders can simply focus on the proposals they support
How voting works
ANT snapshot - A snapshot of ANT balances will be taken and used to determine votable ANT per address during the pilot. The snapshot will occur at block 10,736,220 or approximately Wednesday, August 26, 12pm UTC. Be sure to have your ANT in your preferred address by the snapshot. Because of the snapshot, you are free to do whatever you like with your ANT after the snapshot and still retain the voting power from the snapshot.
ANT voting - Proposals can be submitted at any time during the six-weeks the pilot is running. An ANT holder can vote for multiple proposals or just a single proposal. Proposals will be listed in the Proposal View, see below.
Conviction accrual - Once a vote is cast, the token-weighted balance adds conviction potential to the proposal with conviction accruing over time as tokens are held. The time-based accumulation forces voters to prioritize where they place their conviction. Proposals are approved once their conviction accrual level meets the approval threshold.
Threshold calculation - The approval threshold for a proposal depends on its budget in proportion to the treasury funds. Therefore, proposals with larger budgets require more conviction to pass than smaller budgets. As proposals are approved, and the treasury depletes, all proposals' approval threshold will increase, requiring more conviction to pass. Conversely, as the treasury replenishes, the threshold for passing proposals will decrease. Note, however, the treasury for this pilot program will not be replenished for the duration of the pilot.
Approvals - Upon approval, the payout process is initiated automatically so work can begin as soon as possible. If a proposer fails to deliver, their reputation in the community will diminish and likely lack support for future proposals.
How to submit a proposal
Select your proposal type - There are two types of proposals, signaling and funding. Signaling proposals can still be voted on, but cannot be enacted and do not request any funds. Funding proposals can be enacted and do request funds.
Write your proposal - Anyone can submit proposals with a project or initiative that may benefit the Aragon community and DAO ecosystem. First, post your proposal in the CF Pilot category on Aragon Forum. For instructions, read this introductory post. After reading the post, create a new topic in the CF Pilot category and fill out the pre-populated template with your proposal. For inspiration, see this list of proposal ideas.
Submitting your proposal - To submit your proposal, visit the Conviction Funding Dashboard and click ‘Create new proposal’. You will be asked to select your proposal type, input your proposal's title, provide a link to your proposal's forum post from the previous step, and accept the Terms and Conditions of the Conviction Funding program. For a funding proposal, you will be asked to input your requested amount of funds and the beneficiary address to receive the funds. Click ‘Submit,’ confirm the transaction, and you’re done! Your proposal will now display on the Proposal View with the other proposals.
Claiming your funds - For accounting purposes, Aragon will require the following information:
Natural name, country of residency and tax paying number or passport
Structure of the team: legal entity, a DAO, or an individual. In the case of legal entity, the Applicant must declare that he/she is acting in representation of the legal entity and he/she is duly authorised to present this proposal on behalf of the legal entity
The Applicant must send this information to email@example.com. This information will only be used for the purpose of this program and will not be shared with third parties.
Once a proposal has been approved, wrapped ANT (AA-ANT) will be transferred to the relevant Ethereum address. Once the relevant information has been sent to Aragon, the Applicant will be granted permission to unwrap (convert) their AA-ANT into ANT.
What is conviction voting?
Conviction Voting is a novel decision-making process used to estimate real-time collective preference in a distributed work proposal system. Voters continuously express their preference by staking tokens to support proposals they would like to see approved, with the conviction (i.e. weight) of their vote growing over time.
How is the Conviction Pilot funded?
The Aragon Association is running the conviction pilot as an experimental community-directed grants program. The initial pilot will be funded with 9k ANT (currently valued at $60,390). The Aragon Association is providing all of the funding for the program.
Who can submit proposals and request funding?
Anybody working on a project or initiative that they think benefits the Aragon community, and the DAO ecosystem, will be able to submit a proposal to the DAO to request funding.
Who can vote on the proposals?
Any ANT holder who held ANT at the beginning of the pilot (snapshot date) will be able to participate in the DAO and the decision-making process to collectively allocate the funds among the different proposals submitted by the community.
What are the requirements for participating?
How does conviction accrue?
When voting power is directed at a proposal the proposal will start accruing conviction over time until it reaches a maximum. Voting power can be removed from a proposal at any time, at which point the accrued conviction will decrease from that proposal.
How are approval thresholds determined?
The amount of conviction required for a funding proposal to be approved depends on the proportion of conviction that proposal has relative to all other proposals, and the proportion of funds requested out of the remaining budget. The larger a request, the more conviction will be required.
What is the difference between a signaling proposal and a funding proposal?A signaling proposal is a suggestion that does not request any funding directly. It can be used to signal preferences and encourage grantees to submit proposals that more closely align with the preferences of the community. A funding proposal is a decision to allocate funds to a specific beneficiary for some purpose.