DRAFT: End-of-Year Recognition for Executive Contributions (New Vote with 30-Day Period)

Governance Proposals
1

Voting period: 30 days

Categories:

Social Proposal
Request for Action
Constitution Amendment

Abstract:

This proposal recommends allocating an end-of-year bonus equivalent to 10% of each executive’s annualized salary, to be paid in XTZ, for the Tezos Domains DAO executives. The year 2024 has been a pivotal yet challenging period for the DAO, characterized by a prolonged bear market and historically low activity levels across the Tezos network, including Tezos Domains. Despite these difficulties, the DAO executives demonstrated unwavering dedication, ensuring continuity and preparing the DAO for future opportunities. This bonus serves as a token of appreciation for their contributions while setting an important precedent for encouraging active participation and resilience in the DAO during challenging times.

The outcome of the initial vote P-020 on this proposal highlighted several key considerations about timing, turnout, and participation in governance. While the majority of voters supported the proposal, it failed to meet quorum due to the low voter turnout during the holiday season. Moreover, the reject option only received 1 vote, and this 1 vote came from an individual (not a delegate representing others). This new vote, with a 30-day voting period, aims to provide a broader opportunity for participation and engagement, ensuring a fair and representative decision-making process.

Rationale:

The year 2024 tested the resilience of the Tezos Domains DAO. Despite the recent rally in XTZ price, trading volume, and network activity, the Tezos ecosystem faced significant challenges for most of the year (as did much of the blockchain world until very recently). These included XTZ prices hitting cycle lows and a noticeable decline in other network fundamentals not seen in years. As a consequence, Tezos Domains experienced a sharp drop in participation, reaching some of its lowest levels.

Through this period, the DAO executives played a crucial role in navigating these challenges, maintaining the DAO’s operations, and laying the groundwork of continuity for future growth. Their contributions deserve recognition, not only as a reward for their perseverance but also as an incentive for continued participation in the Tezos Domains DAO’s mission.

By providing this bonus, the DAO reinforces its commitment to valuing its executives, establishes a precedent for recognizing such contributions in difficult times, strengthens morale within the community, and helps attract and encourage top talent to take on these important roles in the future.

Regarding P-020 — Given the low turnout and the timing during the holiday season, I propose we redo the vote with a 30-day voting period. This will provide a fair opportunity for broader participation and help us evaluate whether a longer timeline can increase engagement.:

• Low Turnout: The proposal saw limited participation during the holiday season, a time when many community members are likely unavailable or less engaged. This reduced participation significantly impacted the proposal’s ability to meet quorum.

• Support from Voters: Among those who did vote, the majority supported the proposal, with only one individual (NOT a delegate) voting against it. This indicates a general agreement among active participants, but the lack of turnout meant that this support was not enough to meet the necessary threshold.

• Timing During Holidays: The timing of the vote, coinciding with the holiday season, may have unintentionally limited awareness and accessibility for many community members. Proposals submitted during such periods are less likely to receive the engagement they require.

• Importance of Fair Representation: Proposals like this deserve to be assessed with robust community participation to ensure they reflect the will of the DAO. The low engagement during this voting period risks undermining the validity of the outcome.

• Potential to Increase Turnout: Extending the voting period to 30 days would serve as an interesting data point to assess whether a longer timeline can successfully increase turnout. It could help inform future governance processes and improve voter engagement strategies.

For these reasons, I propose that we redo the vote with an extended voting period of 30 days. This approach will ensure fairer participation, provide an opportunity to gather more representative data, and uphold the DAO’s commitment to inclusivity and fair representation.

Details:

The end-of-year bonus will amount to 10% of each executive’s annualized salary and will be paid in XTZ, consistent with how their salaries are distributed. (For example, an executive earning 250 tez per month would have an annualized salary of 250*12 =3000. 10%*3000 =300. Their end-of-year bonus would therefore be 300 tez.)

The bonuses will be distributed no later than seven days (168 hours and 0 minutes) after the proposal passes, ensuring executives receive their rewards in time for the holiday season.

This proposal is not intended as a commentary on the individual performance or aptitude of any specific executive within the DAO. Rather, it recognizes the importance of the executive positions themselves and the critical role they played during a formative year. Establishing this bonus is an essential precedent, reaffirming the DAO’s commitment to recognizing such contributions and active participation during challenging times while encouraging talented individuals to step into these vital roles in the future.

Specification:

Action #1: Allocate an end-of-year bonus equivalent to 10% of each executive’s annualized salary, paid in XTZ.

Action #2: Distribute the bonuses no later than seven days after the proposal passes (168 hours and 0 minutes), to ensure timely recognition.

Action #3: Maintain transparency in the calculation and distribution process, ensuring all records are clearly documented for accountability.

3

Here’s a summary of my thoughts on this proposal:

Vote: NO on current proposal

Rationale:

  1. Proposal lacks treasury analysis and sustainability planning
  2. Current formulation risks DAO’s operational runway through 2025

Counter-proposal:

  1. Performance-based bonus structure:
    • Bonus pool created when DAO treasury exceeds 12-month operational runway
    • 10% executive bonus activated only if treasury growth targets met
    • Annual assessment of treasury health and growth metrics

Alternative for 2024 bonuses: As Community Manager, I offer to fund the 2024 bonuses from my personal CM wallet, demonstrating commitment to rewarding executive performance while protecting DAO sustainability.

This establishes responsible governance precedent by:

  • Linking rewards to organizational health
  • Protecting operational runway
  • Maintaining executive motivation
  • Demonstrating leadership commitment
4

Although your generosity is evident, I understand that last week you expressed this as an alternative to voting YES on the previous proposal. However, this approach has serious problems that you haven’t considered—and no one you pay is likely to challenge you on this.

1. Centralizing Influence
This action actively centralizes influence away from the DAO and towards a man. By offering to personally fund the bonuses through this process, you passively-consolidate agency and decision-making power toward yourself rather than the collective. This fundamentally alters the balance of governance, making you not just a contributor but a de facto central figure. It undermines the decentralized nature of the DAO and sets a harmful precedent that others could replicate, creating an unequal power structure.

2. Dependency Relationship
This action also creates a dependency relationship. By positioning yourself as the one who personally funds critical initiatives, you are not an equal participant promoting decentralization. Instead, you take on the role of a “boss” within the DAO—whether intentionally or not. This dynamic exacerbates existing perceptions of your role in the DAO, making it seem as though you hold greater authority or control. This issue isn’t about you personally; it would apply to anyone taking a similar approach. The problem lies in the structure of the action itself, which erodes the DAO’s egalitarian principles.

3. Generosity as a Shield Against Critique
Generosity like this often makes it difficult for others to critique the action itself. When you make such a generous offer, it becomes harder for people to raise valid concerns without seeming ungrateful. This dynamic prevents open discussion about the real problem: this proposal consolidates influence and undermines decentralized governance. Your intentions are clearly positive, but the structure of this offer masks its centralizing impact, making it harder for others to point out its flaws.

4. Public Signaling and DAO Legitimacy
Another critical reason to handle this through the DAO is the signal it sends to the public and potential members or token buyers. By paying bonuses through the DAO, we demonstrate that we are a functioning and legitimate organization capable of compensating executives properly. This transparency builds trust and encourages others to join or invest in the DAO. If we bypass this process and rely on personal contributions, we send the opposite message—that the DAO is not self-sufficient or organized enough to manage its own affairs. It’s essential that this decision is recorded and executed on the books to uphold our credibility and attract future participation.

5. Solution-Oriented Adjustment
The solution here is simple. Vote on the proposal, whether you vote yes or not. If the proposal passes and you’re concerned about the treasury’s finances, you can donate to the DAO’s treasury after the fact. If recognition for your generosity is important, we can publicly acknowledge your contribution with a big announcement highlighting how you supported the DAO. Everyone will know, and you’ll get the credit you deserve.

But bypassing the vote and paying out of pocket creates a centralizing influence masked in generosity. This approach runs counter to the DAO’s decentralized principles. Voting and contributing independently after the process concludes keeps everything aligned with the collective governance model.

Your dedication to the DAO is clear, and I appreciate your intent to support it. Let’s ensure we move forward in a way that respects our shared values and strengthens the DAO for the future.

5

Admittedly sending a bonus from the CM wallet is not ideal but it would be just a solution for 2024. I would like to focus on the part outside of my proposed solution.

The crux of my argument and concern is that we do not have monies to pay bonuses as a DAO. Furthermore, we should have a system that pays bonuses based on project performance. It’s no good to pay people bonuses when the survival of the project itself is at stake and I would vote no on such a proposal.

6

Thank you for clarifying your stance, Primate. While I understand your concerns about the DAO’s financial situation and your intent to provide a temporary solution for 2024, I think we need to reevaluate this approach and focus on what’s best for the long-term health and perception of the DAO.

1. Compensation for Positions, Not Individuals or Performance
End-of-year bonuses, are not the same as the conditional performance-based bonuses to which you are referring. End-of-year bonuses, also known as holiday or Christmas bonuses, are an expected and standard part of compensation in many parts of the world, including the United States. These bonuses are not about individual performance but about properly compensating the positions themselves. They are a requisite part of pay, factored into compensation packages as the norm. Failing to provide them signals instability or an inability to properly compensate staff, which directly harms the DAO’s reputation and ability to attract talent.

Making these bonuses conditional on performance conflates them with other types of bonuses that are inherently tied to achievement or results. This is a false equivalence. End-of-year bonuses are not rewards for performance; they are a standard practice in compensating roles. Deviating from this norm sends a terrible signal to both existing contributors and future talent, suggesting the DAO is punitive, vindictive, or incapable of maintaining industry standards.

2. Signals to New Talent and the Public
If we fail to deliver on what is essentially expected compensation, we risk appearing spiteful or unprofessional. Any prospective contributors or executives evaluating whether to join the DAO would see this as a red flag, questioning whether the DAO can properly value its team or operate fairly. This perception could harm our ability to recruit and retain the best talent. Properly compensating roles, including these requisite bonuses, is vital to presenting ourselves as a stable, trustworthy organization.

3. Your Solution Is Still a Centralizing Influence
Offering to personally fund bonuses bypasses the DAO entirely and centralizes power around you, whether you realize it or not. Even though you call it “not ideal,” the reality is much worse: it undermines the DAO’s decentralization and sets a precedent for dependency on individuals rather than the collective governance process.

Moreover, you can achieve the same outcome simply by donating to the DAO treasury after the fact. If you feel this act won’t give you enough recognition, we can publicly announce and celebrate your generosity so that you receive the credit you deserve. However, bypassing governance to take matters into your own hands usurps power from the DAO and is not an acceptable solution.

4. The Right Path Forward
If the proposal passes and you’re concerned about the strain it may place on the treasury, the solution is straightforward: simply donate the amount you would otherwise pay to individuals directly into the DAO treasury. This achieves the exact same result while preserving the integrity of our governance process and avoiding needless complications. What’s so hard about that?

The alternative you’re suggesting—bypassing the DAO entirely—creates massive and unnecessary ramifications. It undermines the decentralized structure of the DAO, sets a dangerous precedent of dependency on individual action, and signals instability to the public and future contributors. There’s no justification for taking such an extreme and problematic step when the simple solution is already available.

7

Kevin,

In the realm of crypto DAOs, compensation structures for contributors and executives are typically predefined and subject to community approval, rather than being unconditional. For instance, the Ethereum Name Service (ENS) DAO has established a structured compensation plan for its stewards, which includes both USDC payments and $ENS token distributions. These compensations are determined prior to each term and are contingent upon the roles and responsibilities assigned, ensuring transparency and alignment with the DAO’s objectives.

Similarly, the Atom Accelerator DAO (AADAO) of the Cosmos Hub had provisions for performance bonuses. However, in a recent decision to cease operations, AADAO contributors unanimously declined their performance bonuses, opting to return approximately $817,159 worth of ATOM tokens to the community pool. This action underscores the emphasis on fiscal responsibility and community alignment within DAOs.

These examples illustrate that while DAOs may offer bonuses or additional compensation, such allocations are typically conditional, performance-based, and subject to community governance processes, rather than being unconditional.

Your argument incorrectly equates DAO positions with traditional corporate roles. Key differences:

  1. DAO compensation was clearly defined at onboarding - no bonus structure included
  2. No precedent exists for unconditional bonuses in DAO governance (that I know of)
  3. Treasury sustainability directly impacts DAO survival
  4. Previous sustainability forecasts did not include the DAO bonuses consideration

If bonuses are desired, they should align with DAO principles:

  • Performance-based metrics
  • Treasury health requirements
  • Governance approval
  • Sustainable funding model

My offer to personally fund was misguided. Instead, propose restructuring bonus framework to match DAO operational model and sustainability requirements.