MakerDAO: Endgame - Restoring Balance to a Decentralized Workforce with Retro MakerDAO

should we kick things off East Denver [Applause] my name is retro and I'm here to talk about uh what the spork is maker end game uh maker has one of the most impactful votes coming up in the history of the Dow uh this month and this is a little bit of an explainer about uh the problems that have been occurring the solutions that we're trying to implement and how that all comes together in the end game plan before we get started though real goofy again my name is retro and my official title is still the intern of the sustainable ecosystem scaling core unit uh but I'm also filling in as the interim facilitator for the collateral Engineering Services core unit which is responsible for onboarding both real world and decentralized collateral to the protocol my journey to the Dow has uh basically been playing in data centers and trying to solve business problems with technology it's also coordinating uh Freight on the uh the global scale and these days I work and play in dows again one more uh uh little uh break here some disclaimers uh these views are my own I do not represent all of maker uh this is definitely not Financial advice this definitely is not legal advice but for anybody that's experiencing similar problems in their Dows this may be mental health advice uh again just a summary of how the talk today will be broken down and to start uh we have to appreciate again that the Dow originally started as a foundation that looked to hand over ownership of this protocol to a decentralized organization that really hasn't been done a ton before and within the last year of operating as Adele we've kind of learned some problems uh the first one starts at the uh the the very top of the governance layer which is the the mipset uh the maker Improvement proposal MIP set that uh we use to direct the organization as well as uh the evolution of the protocol the unexpected addressable fields of governance really relates to what is and isn't allowed in maker and how it works uh an example would be uh imagine a green field but the concrete slab dropped in it and there's about 10 rules about what could be built there from there the organization may rise straight but in a decentralized environment it kind of branches out due to various different reasons that we'll get into a little bit the main takeaway though from uh using the mipset over the past year is that there was way too broad of uh categories of work and strategy that needed to be passed through the framework to reduce that then we have to find some way to scope the addressable work that we want the governance layer worrying about and answer some of these questions maybe a little bit more autonomously about how we can do certain things or can I do certain things does that really need to go up to a token holder vote when everything has to go up to a token voter who a token holder vote uh what we started to see was voter apathy both due to the complexity as well as the volume and the impact that token holders could actually have on the protocol what we saw in the forums was a lot of arguing instead of aligning on Improvement at the Dow uh hold the holders role really became running the Dow which related to approving budgets that even had things uh such as performance bonuses carved out and all sorts of random stuff uh when the Dow is put into situation when the voters are put into a situation like this uh they're really not in the position to lead but they're experiencing a gridlock situation where there's just too much minutia to try to navigate uh and and most of the time you can either play and you know participate in the politics or you could just take a step back and hope that this self-running machine will keep running until there's something that comes up that you truly care about but on that concept of something that you truly care about the uh contributors would then put in a situation to run the Dow because in situations where proposals needed a wide consensus only a couple holders would show up over the course of the Year there were various attempts to solve this problem such as introducing delegates which allowed a token holder who is the main stakeholder in the Dow to give their voting ability to somebody else who is is being paid to spend their time in the Forum to participate in those conversations but what really happened was that contributors became the middle managers of the Dows that were basically negotiating with delegates on issues that shouldn't have ever been brought up to that layer of governance the contributors also had the opportunity then to prioritize pet projects that isn't necessarily a bad thing because we wanted to innovate within the industry and within the organization but going back to that addressable fields of governance again the uh bureaucrats necessarily didn't want to promote this expansive Evolution and introducing more teams and growing the workforce it was more about making sure that their slice of the universe that they were playing in was more protected part of that as well is also uh hiding the complexity of work so you have a group of token holders a group of empowered delegates then that are responsible for voting and a group of people doing the work putting this up to a vote and saying go at it on the floor and have fun we've attempted different things like orchestrating uh Community calls to really unearth and increase the literacy and education of the stakeholders in the Dao but work was hard to prioritize and when that occurs the the movement tends to slow down a little bit uh something that was identified during the initiatives the onboard more real world assets is that we truly needed experts in their field in traditional Industries to come and contribute to the Dow in the current core unit uh organizational model these experts would be have to be hired uh by the contributors uh there would be minimal oversight by governance then about what defines an expert and at the end of the day it was basically just more contributors working on the wrong problems there was poorly defined projects and that resulted in misaligned outcomes when we start to try to explore solutions to the problems that occurred uh we want to make sure that the dependencies required to fix the problem are inherent in every level uh if you look back to the four slides what I was basically talking about was a strategy layer a consensus layer a coordination layer and an execution layer to the operations of a doe so if we start to try to determine solutions to the strategy layer the first step is really how do you define what is best for the Dow and what rules should be made to make the process better one example that we learned a lot from was again the onboarding of real world assets where originally it started out as an application process somebody would submit an application there would be an initial review done by this uh independent team and from there there was a whole ton of politics about if the work was good if this is opportunity is good and in every direction so if we can just simplify and structure the governance layer the strategy layer to really be this this executive function of the Dao then we can start to have greater alignment throughout the entire organization once you have a strategy though it has to be empowered you can write it down you can talk about it all day but unless you're in a position to actually act on it then where is it going to go to do this we want to both empower the strategy but then also contain the politics and contain the politics really appreciates and accepts that the Dow requires humans to operate if we're going to go to the goal of uh accomplishing the goal of maker which is creating an unbiased world currency that operates as a public good there's going to be a lot of people involved so to empower strategy and contain the politics we start with defining the governance layer purely as a strategy layer again elevating the token holders to being that executive or strategic function of the Dao and uh Define process owners or somebody that has to play in the process of consensus the politics of negotiating and highlighting good strategies or bad strategies we really want the strategy to develop from this organic place and then allow the consensus to occur across the entire governance layer though maybe not necessarily contributors but we'll get to that in a minute from there what that really breaks down into is that we're establishing a class of governance only for strategy and we're separating the politics of agreeing on that strategy to a different function uh there's a little bit of a preview it's basically the delegates again but restructured and the doubt the intention of the delegates again were to allow token holders to both uh use their time more effectively and offload the requirements of studying and learning these Concepts to someone else but also give smaller token holders the ability to to Rally around a purpose or in this case a person and their personal platform to deliver on their intent even uh for minority holders the solution that we believe identified for addressing the bureaucratic uh elements uh that occurred within the workforce at the Dow was that the we really wanted to lean into this concept of experts uh what we're trying to do is hard I think you can ask any project here that they've run into roadblocks and had to ask for help and bring in people to their ecosystem and what that represents for maker uh as a solution to a bureaucracy is putting the expertise in the position to solve those hard problems but also support building the strategy and now hopefully you're starting to see this concept emerged where you have somebody who's responsible for finding the strategy and now they're actually receiving resources from the Dao to do so uh once you have a well-defined strategy that's built by an expert if you build it right the first way then it becomes sop standard operating procedure that anybody can use and and to me this really represents the a of autonomy which is allow people to come in and do work independently and put them in the position to deliver value the other thing that processes do is that the processes then manage the workforce if orchestrated correctly or set up correctly you have this system of incentives and penalties for doing things the right way or doing things the wrong way uh lastly again for the hidden complexity of work we believe that entrepreneurs are the real answer to this underneath the current core Unit Model the independent teams receive funding or or paid uh funds for their expenses but they're not really put into position to drive profit they're not managing a p l it's it's the core units expenses and the Dallas profit and this was a great experiment and we've learned a lot that will lead into uh the the end game portion of this presentation [Music] autonomy is the ability to do what you want within a certain set of constraints Free Will is is more of that Greenfield exercise so if we really want to be a Dao the decentralized part is is there and it could be better the a really needs to be developed and the organization uh is going to represent the culmination of those two so we've identified some problems uh uh We've identified some solutions or some areas that have alleviated those problems uh now I think it's time to introduce endgame uh so endgame may sound a little scary uh may have some negative connotations but the main focus of uh the concept of an end game is to put things in a process so that things are just done more consistently from learnings and using the Frameworks the best example of this is chess back in the 1950s when computers were first getting started Grand Masters would use these Frameworks to basically programmatically follow the first five moves to put themselves in a better position to win over time these days chess tournaments can see 15 20 25 moves following the same process so think about that from an entrepreneurial standpoint of if you're wanting to start a business you have a rule book here and you just have to go out and do what you're best at within the system so that's what endgame is and let's start to break down how we attack the problems and solutions with endgame components the first one is the maker Constitution this is uh structuring the organization at every level to follow that concept we talked about of strategy consensus coordination and execution alignment engineering is is the overall principle that the constitution attempts to tap into because answering the question of what is best for the Dow needs to be defined somewhere the Constitution does this by acting as this uh um ossified concept of what is maker it's written down it's voted on and and again uh towards the end of March we'll see if the maker constitution in its current form is accepted the purpose-driven Dao again relates to the unbiased Global world currency and a public good and from there in order to tap into uh more of these powerful Concepts that unlock the systems wise organization uh the maker Constitution defines those concepts of separating the the strategy layer and putting people in this position to to play their role and only their role within this machine the structured Innovation is uh created by a process oriented approach about requiring experts to contribute to the building of new processes but then once you have these processes that really leans into unleashing competition and entrepreneurs to play in the ecosystem and create value both for themselves and for the protocol moving uh from the Constitution the the the first group that needs to be appreciated and it's a difficult concept to try to to grasp is this constitutional voting committee what a constitutional voting committee is is a collection of token holders they have verified mkr in their wallets and together they work on this strategy document that defines how maker can accomplish its purpose-driven goal it sets the strategy for the organization and then positions delegates to then support strategies today uh token holders give their tokens to a delegate uh the voting power at least and the only tool that they have is to remove the delegation and give it to somebody else there's no alignment mechanism there the Constitutional novel gets work as the politicians to create that alignment mechanism by setting up two delegation contracts that support two different strategies that cvcs create from there they play the role of the politician to work on building the consensus for the organization based on these well-defined strategies their work basically represents voter consensus by the way that uh mkr utility and incentives are created for staking and and and participating within the system now that we have how the organization works and how the organization agrees on things we need to see how the organization can program itself and the way that it does that is by creating Focus areas known as Scopes uh the current draft of the Constitution defines 12 Scopes which talks about the requirements of decentralized uh collateral to be onboarded as well as real world asset collateral to be onboarded as well as how stability and liquidity must be managed across those assets to create the the stable corn product and and position it as as best fit within the the industry the Scopes are separate and again from the focus groups within the cvcs there's a lot of alignment across who has an interest in what who has expertise and what and again it's wrapped with this incentive mechanism in order to really make sure that the machine is is is is operating effectively Frameworks are what live within Scopes these are a dual purpose document that both defines the scope area so one clear example is saying that wbtc is not a decentralized asset because it does require a legal layer in order to pull it back and unwrap it so that would be a real world asset that's one example uh with a couple different Scopes and I'll expand that across 12 different areas of the Dow you have experts contributing across the product layer the governance layer as well as the workforce layer to create this self-sustainable machine the last thing to bring up then is what do we do at the workforce how do we unearth the complexity of work how do we enable entrepreneurs to participate in this system in a truly decentralized and autonomous way the solution that's been brought to the table is the creation of sub-dos which would be independent dials in their own right that contribute and are holistically tied to the maker core there is uh probably an hour-long dissertation that I could give about the tokenomics and how the incentive mechanism works with replacing uh the burn Engine with different mechanisms of value uh accrual and and management but the main thing for this talk for this audience within the Dao is that it structures the workforce into uh Innovation teams that deliver against the Frameworks the uh it also organizes the workforce into specialized areas uh there's three classes of of sub-dials that allow the teams to specialize and deliver against certain Scopes uh that allows again another layer of governance to participate uh within this alignment and um searching mechanism about what opportunities are the best to deliver to the Core also de-risked the core and remove the opportunity of personal pet projects being delivered because the tokenomics require certain uh layers of insurance penalties that would be assessed if work wasn't delivered as well as opportunities to Leverage The Core to its truest potential to deliver again on that purpose-driven uh mission the uh end game plan is being voted on this cycle in March uh what we have up here is is a uh growing ecosystem where the core is ossified and protected by the three rings of Scopes and there's various sub-dials with their own culture and incentives and and desires circulating around all contained within the gravity of the maker ecosystem so if this sounds like uh something that interests you if you're in strategy or if you're another project that wants to contribute to the ecosystem start paying attention uh to the forums if you have maker there's probably the biggest vote like I said of uh our history coming up why not participate and and signal if you want to continue to participate or sit on the sidelines but thank you Heath Denver I'm retro from maker dough and we are looking for designers uh content producers and governance designers as well these slides were not great and we would love any help so thank you [Music]