1Inch was built on the foundation of decentralization, which entails decentralized governance. 1inch currently uses delegates, but there is only a small number of delegates and there are many obstacles that prevent the delegation from being a valuable tool in the 1Inch governance system.
This proposal seeks to develop a website for 1Inch delegations to simplify the process of delegation and increase the number of delegates. As well as discussing possible ways to make the delegate role more appealing.
As mentioned in the network documentation, St1INCH and v1INCH holders can delegate their voting rights to any address, but no clear website or documentation details this process. Upon googling ‘1INCH delegate’ you come across a snapshot link that allows you to delegate, but you need to know the specific ETH address too. This current UI is not sustainable as token holders who are not confident with this process will feel intimidated and avoid delegating in total.
These obstacles, (i) No specific webpage for delegation and (ii) input ETH address, and (iii) no options to delegate, will prevent the delegation system in 1INCH from being successful and reduce the effectiveness of governance within the 1INCH ecosystem.
There are only five applications for a delegate, which can be improved. We need to actively increase the number of delegates by exploring the option of incentivized delegates. I believe that delegates should be compensated for their work as it can take time to attend community meetings, read forums, and vote. As protocol grows, the work for a delegate will increase, becoming more of a job.
This proposal aims to detail the necessity of creating a separate web page for delegation, simplifying the process of delegation, and increasing the efficiency of the governance system. We can use MakerDAO and Element Finance as examples.
1INCH is a decentralized protocol that can work toward further decentralization. In order to further push 1INCH to a more decentralized system, it would be in the protocol’s best interest to simplify the delegation process for token holders.
Using MakerDAO and Element Finance delegation platforms as inspiration, we have two aims.
1. Encourage delegate applications
A thread called for delegates resulted in only < five applications, with most of the applicants being closely connected to the 1inch foundation.
Announce delegate applications on Twitter, Discord, and other social media platforms used by 1INCH to increase the number of delegates possible. 1INCH is a very popular platform used by many, so the lack of applications is not due to the protocol, but most likely due to the lack of outreach and/or incentivization.
Discuss incentives for delegates
Delegates usually are volunteers, but this is often unsustainable. We could explore possible incentivization for delegates as this encourages long-term contributions as we manage their contributions and voter percentage, a similar mechanism used by MakerDAO.
It has been suggested that delegates will initially volunteer and support a protocol, but soon after the ‘honeymoon’ phase ends, they will commit less time to it, as shown by the Compound Finance delegates. A majority of large Compound Finance delegates are inactive. Still, a financial incentive would probably make them more active, as being a delegate requires a large amount of time once a protocol becomes more mature, acting more like a part-time job.
Element Finance and Optimism are exploring possible incentive mechanisms for their governance structures. We should recognize that it seems inevitable that delegates will become a paid role.
Connect with student blockchain clubs
We could encourage blockchain clubs at college to participate in 1INCH governance as this is a great way for non-technical people to become more involved in the space while impacting a DAO. Students will be the future, so we must partner with clubs to provide a space for them to learn and participate.
Blockchain clubs such as Berkley, Carnegie Mellon, and others have groups that focus on governance, and we could outreach to them to see if they would be interested in participating. We know a few students at these clubs who are actively looking to contribute to governance. Finally, some clubs are restrained from actively making a profit, so they would not be interested in the incentivization and more focused on participation and gaining experience.
2. Create a website that has the address of these delegates, and allows a user to delegate their tokens in one click.
To simplify this process of delegation, it would be helpful to make a website with a more clean UI, such as the MakerDAO or Element Finance. A website like those would make it more like an amazon one-click buy option, reducing the obstacles for the delegator. Having another webpage would demonstrate 1Inch’s dedication to governance and delegates.
As governance within 1INCH grows, there will be more delegates involved, making it unsustainable to rely on individuals to use the snapshot website solely. This would streamline the delegation process and hopefully increase the number of tokens delegated.
If we follow the Element Finance model, we can let people apply in the forum with their username, address to delegate, etc. This model seems ideal for 1INCH right now as it allows everyone to become a delegate.
From an outsider’s perspective, 1INCH wants to work on its meta-governance and delegate program, but within that process, multiple obstacles hinder 1INCH’s progress in this domain. Other protocols have employed practices that I detailed above, with great success, leading to delegated tokens.
We should take a step back and recognize the hindrance of delegation in the current system. We need to simplify the process and make it a more attractive role. Hopefully, this proposal has outlined a few ways that we should approach delegation to make it more appealing.
We should note that delegation, in general, is still a very new and unexplored area, so it is normal for a reduced number of delegates. Coupled with the nature of the current market, there could potentially be a reduction in governance contributors. Nevertheless, we should prioritize delegation as it is an important topic that needs to be addressed within 1INCH and the wider space.
Building the website for delegation would require a small team of developers, so we would need to discuss the costs of this team, which would come from the treasury.
- Easier for token holders to delegate their 1INCH tokens
- Increased number of governance delegates
- Increased number of governance contributors
- The delegate role is made more attractive for applicants
We need to encourage delegates by tackling this problem in two ways: a simple delegation system and incentives for delegates. So far, the delegate system in 1INCH faced these obstacles, but we can hopefully see an improvement by implementing some of the suggestions.