The Graph Council acts as a representative of the key stakeholders of The Graph: Indexers, developers, researchers, active token holders and the initial team. Members of the Council are operating in the best interest of the network participants, the security of the protocol and the overall ecosystem.
Council members value transparency and have agreed to follow Chatham House Rules for sharing meeting notes. On Tuesday, March 22, 2021, The Graph Council held its 2nd meeting.
The Graph Council Meeting #2 - March 22, 2021
Council Members (“Members”)
The Graph Foundation
Eva Beylin, Director, The Graph Foundation (the “Foundation”)
Jeremy Sklaroff, Edge & Node
The meeting commenced at noon PDT.
Foundation Q1 Update
The Foundation provided ecosystem Q1 highlights, updates on resourcing, funding, and grants, including categories of grant recipient projects, and a Q2 roadmap.
A Member discussed the presence at the meeting of a representative of Edge & Node Ventures, Inc. (“Edge & Node”). The Council agreed that this representative could attend this and future Council meetings for purposes of taking notes, until a suitable individual from the Foundation could replace him. Pursuant to the policy, the representative will excuse himself from any Council discussion in which there is a conflict between the Foundation and Edge & Node.
A Member proposed that certain Council discussions would be sufficiently sensitive that they should be excluded from meeting notes. The Member identified conversations about Foundation employee compensation, protocol security, and topics protected by NDAs as examples of what would be excluded from meeting notes.
The Members debated how such omissions should be reflected in the notes. One Member suggested that such omissions could be redacted from the notes, whereas most Members preferred that such omissions simply be left out of the notes because redactions could still yield contextual information about the subject of the redactions.
The Members agreed that omissions from Council meeting notes could simply be left out of the notes as opposed to being redacted and that the policy should be flexible and not overly prescriptive.
Finally, the Members agreed that the meeting note-taker would circulate meeting notes for Members’ approval before such notes are released to the community. Members will have two days to review such notes.
Graph Improvement Proposal (“GIP”) Process Update
A Member updated the Council that GIP-0002 and -0003 have completed snapshot voting, and that there was almost unanimous support for both. However, the Member noted that there was some disagreement within the delegator community around 0002. One particular Indexer vocally disagreed with the proposal even though they did not ultimately vote.
The Member gave a brief update on the status of 0003, stating that an audit of the proposal will commence shortly.
The Member reviewed the background and criticisms of 0002. The proposal would allow Indexers to immediately withdraw indexing rewards to an address that is different from what the address they used to stake, which would, in turn, allow Indexers to withdraw their rewards more quickly than under the current design. The Member highlighted the following criticisms of the proposal:
The proposal would change the power dynamic in the network - previously, Indexers would be required to wait for a thawing period before being able to withdraw rewards, in the same way that Delegators would. However, 0002 would allow Indexers to withdraw immediately, whereas delegators would still be subject to a thawing period. The Member noted that the Council should seek to minimize disruptions to the relative powers of ecosystem participants where possible.
The proposal would introduce a new incentive for Indexers to try and time their withdrawal of rewards with the market. Under the existing design, the thawing period prevents Indexers from this type of timing strategy. 0002 was not intended to introduce this kind of new incentive into the protocol.
The proposal could encourage a black market in which Indexers keep 100% of indexing rewards to themselves and share their immediately withdrawable rewards with Delegators through extra-protocol arrangements. This could provide a vector for centralization and disintermediate the protocol’s delegation market.
The Member concluded by describing Edge & Node’s efforts to draft GIP-0004, which would re-introduce the substance of 0002 while imposing a 28-day thawing period on Indexers’ withdrawal of their indexing rewards. The Member stated that 0004 is mostly complete, though Edge & Node is still evaluating gas costs associated with the proposal and writing the prose that will accompany the proposal.
The Member proposed the following for the Council’s vote:
The Council should implement GIP-0003 once the audit is complete, and the Council should do so asynchronously rather than dedicating a meeting to such implementation.
The Council should defer implementation of GIP-0002 until GIP-0004 is complete.
The Members evaluated the proposals. Several Members highlighted the fact that Indexers have not yet been able to withdraw any indexing rewards and have therefore been waiting for the kind of relief proposed by GIP-0002. The Members were concerned that further postponing this kind of relief could frustrate Indexers and pose risks to that segment of network participants.
A Member asked whether moving from 0002, which did not impose a thawing period, to 0004, which imposes one, would cause blowback from Indexers. A Member responded that he believes that Indexers are primarily interested in being able to withdraw rewards in a reasonable timeframe, which is not possible under the current design, and that they are sensitive to parity of incentives across the ecosystem and would prefer to see equality in the reward mechanism rather than a preference for one stakeholder over another.
The Members emphasized that Indexers will want clarity as to the timing of completing and implementing GIP-0004. One Member noted that the key timing constraint is audits, which will impose at least 2-3 week delay before the proposal can be adopted. The Member also noted that Indexers would then need to wait for the 28-day thawing period to elapse before withdrawing their rewards.
One Member asked why GIP-0004 was being discussed at a Council meeting before being proposed on Discourse. A Member responded that the intention was for the Council to vote on deferring GIP-0002 until 0004 was completed and that 0004 would be proposed on Discourse within the coming days, as soon as it is complete.
One Member asked how much the Council should guide these types of governance debates on Discourse. A Member responded that each Council member can provide the views of its respective constituency group on the forum once 0004 is proposed. Another Member suggested that Members be transparent with its reasoning for introducing 0004 to replace 0002, given that there was a lot of community agreement with the underlying criticisms of 0002.
Finally, the Council voted on the proposals to defer implementing GIP-0002 until GIP-0004 is introduced and to implement GIP-0003 asynchronously. Both proposals received eight affirmative votes.
Council Engagement with Auditors
A Member stated that the Foundation is engaging auditors to focus on token economic protocol attacks, whereas the Foundation’s existing auditors are primarily focused on technical attacks. The Member asked the Council to start thinking about ways it could engage with such economic audits, including potential protocol changes or parameter changes proposed by such audits, without dedicating full meetings to review such audit reports given that they are relatively complex and technical documents. The Member suggested that one or two Members could be tasked with reviewing the reports in-depth with the auditors and that the Foundation could provide educational sessions on The Graph’s protocol and token economics.
Future Council Meetings
The Council agreed to meet again in two weeks.
The meeting adjourned at 1:00 pm PDT.