Hey all, The Graph Council met to discuss GIP-0002 yesterday. Full meeting notes are incoming, but I’d like to post a quick update from E&N’s perspective since I know a lot of folks are eager for more information here.
First off, I’ve loved seeing all the thoughtful and civil discourse on this issue. Thank you!! I’ve tried not to put our thumb on the scales of the conversation too much, so as to foster as much community input as possible (would welcome feedback on this approach!).
Second, I appreciate everyone’s patience as I can confidently say this has taken longer than I think any of us would have liked. There’s been a substantial amount of work to get The Foundation and Council’s governance tooling and processes in place, and for our (E&N’s) part, switching modes to contributing to The Graph as external contributors has been a learning process as well. Finding auditors’ time has also been extremely challenging, given the recent renewed interest in crypto, but we are working on getting multiple retainers set up so that we have dedicated auditor time blocked out for future protocol changes. I expect this process to become much smoother in the future.
After synthesizing all the ideas discussed here, as well as the Snapshot poll we came away with the following main takeaways:
- There is nearly unanimous support for giving Indexers a way to withdraw rewards to cover their operational expenses.
- A number of Indexers and Delegators see the removing of the thawing period for Indexers’ indexing rewards as problematic.
In response to this, and the specific points made, the Edge & Node team has started working on an alternative proposal and we (Yaniv and I) made the following recommendation to the rest of The Council, which they agreed to:
Defer making the upgrade described for a little while longer so we can evaluate it against an alternative implementation that allows Indexers to withdraw indexing rewards to a separate address, but keeps the 28-day thawing period.
We recommended this plan for the following reasons:
- While it was never the intent of the V1 protocol for Indexers’ indexing rewards to be locked for withdraw, it was also never the intent of GIP-0002 to shift the power dynamics between Indexers and Delegators. One of the principles laid out in the original Graph Council blog post was to avoid zero sum games and so we have a responsibility to at least evaluate an alternate implementation that accomplishes the same result as the original proposal without introducing a zero-sum game.
- Allowing indexing rewards to be withdrawn immediately could lead to erratic or unpredictable allocation opening/closing behaviors as Indexers attempt to time the market for selling indexing rewards.
- Allowing indexing rewards to be withdrawn immediately, but not Delegators, could lead to extra-protocol arrangements in which Indexers agree to immediately share indexing rewards with their Delegators. This could provide a vector to centralization and protocol disintermediation.
As some of you have already noticed from commits in Github, Ariel is working on a reference implementation of this alternative design and we expect to have a GIP (0004) published on Radicle within the next day or two.
As noted earlier, The Council consented to delaying the GIP-0002 upgrade until we have a chance to evaluate against the alternative proposal. Part of that evaluation will include the timeframe on which these proposals could be rolled out: A major pro in GIP-0002’s favor is that it has already been audited by OpenZeppelin. GIP-0004, on the other hand, is still pending an audit—and as noted earlier getting these audits scheduled has gotten substantially more difficult.
I take the time consideration seriously and would not personally support delaying on GIP-0002 if it meant Indexers waiting substantially longer to claim their indexing rewards. I hope to have more information on the timing of audits by EOW. The Council is meeting again in two weeks so it can move quickly on whatever approach ends up being decided.
One possibility could be to upgrade to GIP-0002 in the near term, and then upgrade to the alternative approach in a second step, though this introduces additional overhead and bloats the smart contract state as a result of the additional proxy upgrade.
Stay tuned for full meeting notes from the Council. I’ll link to them here, once they are available.