The current iteration of the Community Fund DAO has been successful in certain respects, but it has lots of room for improvement. We have learned many lessons, and it’s important that we take this knowledge into the next iteration.
We have begun drafting a proposal for a new DAO design which aims to address many of the shortcomings that have been identified. This proposal maintains the ability for CKB holders to vote directly on any proposal but also adds the ability for CKB holders to delegate their voting power to a representative who they can entrust to vote in their interest.
This proposal is intended to be practical, feasible, and simple enough to be well-understood so that it can be trusted at the core of the ecosystem. There is purposely nothing complex, experimental, or flashy. Many components can be stepped into to ensure the platform becomes operational before the full scope is realized. To be successful, we must be deliberate and effective.
All are welcome to add feedback to the current proposal as we continue to refine it. Feedback can be posted here or added as issues on GitHub where the documents reside.
Very interesting. Just created an account for this - investor since 2022 and somewhat active on Twitter.
I like the learnings and the proposal. I would add my voice to others about considerations of short term holders driving voting. I think their voice is worth listening to (their votes can carry some weight) but we should assume short term incentives which are not necessary aligned with a sustainable for CKB.
We should ensure DAO holders (whatever form that takes) always hold the majority of votes.
I would be happy to support this proposal. Thanks to everyone giving their time and energy to help move things project forward.
Thank you to Jordan for organizing this proposal revision. It’s a great thing to turn past experience into structured rules. I’ve served for over four years as an IT budget committee member at a Fortune 500 company, and I’ve implemented many institutional mechanisms in budgeting, project management, and progress tracking. So I’d like to take this opportunity to share some of my thoughts on the DAO, for your reference.
Over the years, DAO-funded projects have seen successes, failures, and even cases of fraud. Failure is not scary — what’s scary is being scammed. It’s never too late to fix the pen after the sheep are lost. Perhaps we should compile a project review list, go over all past applications, and summarize: which ones succeeded? which ones failed? and why?
Goal: A Truly Decentralized Project Application & Governance Platform
1. Lack of End-to-End Accountability: Funds are disbursed like they belong to no one
The original intent of the DAO is to fund quality projects, so we should avoid a process that stops at presenting a PPT, casting a vote, and sending the funds, with almost no follow-up on project execution.
Take this project for example: [DIS] Palmyra: RWA Lending on Nervos
The team took the money — but did they actually deliver anything? Who’s responsible? Can anyone in the community answer?
According to the V2 proposal:
“Accountability - Recipients of grants must remain accountable to deliver on their commitments.”
So here’s the problem: how exactly do we enforce accountability? Who is in charge? What happens if the applicant disappears? Can the funds be recovered?
We’ve seen good actors like William, who, despite facing health issues, voluntarily returned most of the unused funds. But what about those who don’t?
2. Milestone System Exists in Name Only — No One Reviews or Approves
Milestone-based payments are good in theory, but in reality, it’s just “they say it, and we pay.” No validation, no follow-up, no responsibility.
Who is supposed to review the milestone? Where are the evaluation criteria?
Without these, the first payment is practically a graduation bonus.
3. Strictly Ban Proxy Applicants — Only Execution Teams Should Apply
I’ve clearly expressed my opposition to proxy-based applications before:
Just like in traditional engineering tenders, intermediaries introduce too many issues. The Palmyra project is a textbook example.
As the number of projects grows, we must institutionalize a ban on proxy applicants. If something goes wrong, the DAO needs to know who is truly accountable — not chase ghosts.
4. Add a Technical Expert Review Mechanism
The tech capabilities of token holders vary greatly. Many proposals have technical complexity that can’t be understood at a glance. Some may be fooled by fancy words and buzzwords.
I propose setting up a technical expert pool, and for each proposal, randomly select 3 experts to evaluate the technical feasibility.
Only after passing this stage should proposals enter community discussion and voting.
Nervos has enough top-tier technical experts to support this system.
5. Budget in USD, Pay in CKB — But Use Dynamic Price Calculation, or Default to CKB-based Applications
Volatility is a reality. In the past, we worried about prices dropping, leading teams to abandon delivery. But what if CKB price surges midway?
If a project is priced in USD at a low CKB price, and CKB then rises sharply, the DAO ends up giving away a valuable appreciating asset at a steep discount.
In this case, the project team benefits from price appreciation, while the DAO loses long-term value. This creates huge risk in a bull market and undermines capital sustainability.
My suggestions:
Projects may apply in USD terms;
But each fund release should be recalculated using the current CKB/USD exchange rate;
Avoid “cutting ourselves” by paying out based on outdated low prices.
The DAO doesn’t hold stablecoins — it holds CKB.
We can’t just be afraid of price drops and neglect the risk of value loss when prices rise.
Of course, in the future we can also encourage CKB-denominated proposals, where builders and DAO share in the risks and rewards of CKB price fluctuation.
6. Split Structure: Separate Feasibility Assessment and Execution
As project volume increases — especially those over 1M CKB — I propose we separate technical & economic feasibility reviews from the execution itself.
Is the project worth doing (tech + economics)?
Can the team actually deliver?
Once feasibility is confirmed, a public team selection process can be initiated. This creates better governance and reduces moral hazard.
7. Require Man-Month Estimates & Per-Person-Day Cost to Prevent Overpricing
All proposals should clearly specify:
Total man-months of work;
Cost per man-month (or person-day);
Whether pricing is in line with the market.
Let me give an example:
In 2004, IBM quoted us $1500 USD per person-day. We had no choice.
Today, server maintenance in China can cost as low as $200 per person-day, with solid quality.
With the wave of Web3 VC collapses, dev market rates are trending downward.
If DAO aims to allocate resources wisely, involving high-quality, cost-efficient Chinese developers is the best route to maximize returns.
People often talk about the significant gap between Eastern and Western communities — but in reality, many of these so-called “differences” stem from fundamentally different price expectations and cost structures
8. Formalize and Protect the Inquiry Process — No Interference Allowed
In a truly decentralized platform, only two mechanisms remain:
Community inquiry
Final voting
The inquiry stage must not become a formality. If a team can’t even answer hard questions, maybe the project isn’t solid to begin with.
The inquiry process is like a public prosecutor’s independent investigation — no interference, no favoritism, no watering down due to “who submitted it.”
9. Add a Mechanism for Post-Evaluation of Economic Value
In addition to technical feasibility and execution, we should consider adding economic value assessments to both the proposal and post-completion stages.
Let me give an analogy: China’s “Road-to-Every-Village” public infrastructure campaign was, from a purely financial ROI perspective, a loss-making endeavor — the roads could never earn back their construction cost. However, these roads unlocked massive long-term value by stimulating rural economies and enabling the movement of people and goods.
Similarly, some DAO-funded projects may not be profitable in the short term, but they might play a key role in catalyzing ecosystem vitality, adoption, or developer engagement.
I propose that we introduce an economic value assessment module:
In the application phase: ask applicants to provide their anticipated economic impact, even if indirect;
After project completion: conduct backward-looking evaluations on what economic value was actually created (e.g., traffic, new users, network effects, CKB burned or locked, developer reuse, etc.).
This will help the DAO accumulate institutional knowledge, and improve decision-making quality over time.
10. The DAO Should Establish a Clear Exit Mechanism for Funded Projects
The Palmyra case highlights a crucial gap: while the DAO has a funding mechanism, it lacks a formal exit mechanism.
For projects that fail to meet their committed milestones, remain inactive for extended periods, or show no signs of execution, the DAO should define clear exit criteria and procedures, such as:
Reclaiming unused funds;
Public evaluation by the community or designated reviewers;
Requiring the team to re-apply or explain delays.
Without a proper exit system, the DAO risks turning into a funding black hole — or worse, a source of reputational damage.
One Final Note: Do I Have a Personal Agenda? Yes — I Want a Healthy DAO
I am not targeting the English-speaking community.
I am not favoring the Chinese-speaking community.
My only personal agenda is this:
I want the DAO to use every CKB wisely, to grow the Nervos ecosystem, and to help the CKB I hold increase in value. That’s it.
Just as Nervos seeks to prevent a “tragedy of the commons” on-chain,
I don’t want to see a DAO-level tragedy of the commons happen under our own noses.
Thank you to everyone who read this far. I truly hope DAO v2 will bring stronger structure, deeper trust, and better outcomes for us all.
— woodbury.bit
感谢 Jordan 组织这次方案修改。将过去的经验总结并形成制度是一件好事。我曾在世界500强企业担任专职 IT 预算委员，在参与的预算、项目管理、进度管控中大量运用了制度化手段，所以借这个机会，也想表达一下我对DAO项目的一些思考，仅供参考。
Thanks Jordan (and anyone else involved) for putting this together. You’ve covered lots of the important parts of the DAO that need to be fixed.
There was 2 points in particular that for me were major issues in the current DAO, the first one is the weighted voting and the second is the currency that the proposals are paid in.
Implementing a voting weight system definitely needs to happen, but this needs to go far further than 30 days, which is pointless and shows no real commitment and loyalty.
The top holding timeframe for the most voting power should be extended out to at least 1 year (3+ years would be even better) and while DAO holdings could still hold some sort of ‘extra’ power, I think that holding time in general should take priority.
Holders outside the DAO are already paying their way, at the moment through less inflation and in the future through more funds into the DAO, so they shouldn’t be punished further.
The most important thing is that you reward the real longterm holders, no matter how they choose to hold and let them be able to compete against short term holders/traders who may have a far larger holding.
This decision shouldn’t be left to the proposer to ‘gamble’ with the DAOs funds and they shouldn’t get the option to choose, the request and payment must be made in USD through every stage.
After a successful proposal, the DAO could convert all/some of the CKB to stable as a hedge, but the payments being made in USD should be non-negotiable, nothing else makes sense.
The only exception is if part of the proposal is for smart contracts and cell creation, then this portion should be requested and paid in CKB as a separate part of the proposal.
Thanks Jordan, your contributions here and to the ecosystem are invaluable. I’ve given my feedback previously and my overall thoughts are that this is a necessary step forward to refine the DAO
@woodbury.bit Thanks for your detailed feedback and review of the content. You raise some good points in your post. Let me address some of the points regarding Palmyra:
I feel we may be too hasty in writing Palmyra’s obituary. To clarify, they have not claimed for milestones beyond the initial instalment, and that instalment still remains in the original wallet. I think you are fair to point out the following and these are points I would agree on:
Work has not yet commenced on building the CKB modules
I would like to see firmer plans for integration in their roadmap.
Expecting regular updates in the proposal thread about where things stand.
To their credit, they have regularly participated in the community to inform us of their current progress, including during joint hosted CKB Eco Fund / Nervos Nation spaces on X, Foundation hosted town halls and Hashing it Out. The team is easily contactable and we have been in touch with them on a regular basis about a variety of matters. My experience of them is that they are a very busy team working on multiple fronts and ecosystems.
It’s important to remember that Palmyra is a multichain project that has been making noteworthy strides forward in the RWA space and growing links with various markets, commodity producers and consumers. This now includes branches in Argentina, Sri Lanka, Zambia, and Greece. This information is available on their social media pages. During this time, they have still regularly mentioned CKB in their plans and have also expressed interest in integrating CKB Fiber network and RGB++. There is much to be excited about regarding Palmyra in my opinion. But I return to your perspective that communication on this forum has been lacking, which I agree with.
Moving to the more general thrust of your comments, accountability is more easily applied to teams who are doxxed, and a milestones framework where payment is made in line with meeting agreed targets (as per the current DAO). A DAO clerk (v2) can perform a variety of administrative functions, including helping to ensure the DAO is kept up to date with development progress. An appropriate assessor can be nominated to verify that progress if beyond the scope of the clerk.
My opinion is quite different: I believe suitable community members should participate more in introducing projects to CKB, including guiding them through the proposal stages. We should mandate that the tean itself participate in the thread to introduce themselves and answer questions. It is ultimately they who are accountable. Risk is mitigated through appropriate due dilligence and a milestone approach which reduces large upfront payouts. The purpose of sponsoring a proposal isn’t to circumvent accountability, it’s to reduce barriers to productive integrations - especially regarding a DAO process that is still very much unrefined, confusing, and difficult for outsiders from a UX perspective (especially Metaforo, binding etc). In an ideal world, a grant proposal should be a straightforward process.
Community members who can build links with good projects outside of our ecosystem are doing an extremely valuable service. But finding the right project isn’t easy, there needs to be some level of alignment in terms of product, developer ability, and philosophy. There is still a gap between building an innovating smart contract blockchain and having a healthy flow of new projects - the community plays a crucial role here. One unwanted side-effect will be an increase in poor quality proposals or projects that aren’t the right fit; we can perhaps tighten up the proposal process, as you have mentioned, to request more in-depth breakdowns in terms of plans and funds. But overall I think it’s worth the tradeoff.
That said, I think it’s important to clarify one key fact:
The progress updates you’re referring to around the broader Palmyra project are not directly related to the scope or timeline of the specific proposal that was submitted to the DAO.
According to the original proposal document — which was approved by the community — the stated completion date was Q4 of 2024. As of today, no development work has been started on the CKB-related modules outlined in the proposal.
This is an objective and verifiable fact.
In DAO governance, what ultimately matters is delivery and accountability. As we saw in William’s case, the most appropriate and transparent course of action would be to return the unused initial payment to the DAO treasury and re-submit the proposal once substantial progress has been made.
Allowing a project with zero visible execution to remain publicly listed in front of the community damages trust, credibility, and the fairness of the DAO process — especially for other developers who are operating in good faith and delivering real results.
In addition, I want to re-emphasize a core governance principle I’ve spoken about before:
I strongly oppose any form of proxy or third-party proposal submission.
Funding proposals must be submitted directly by the team executing the work, to ensure:
Full transparency;
Accurate technical communication;
Clear accountability.
This proposal — submitted by a third party, not the developers themselves — has directly contributed to the confusion, misalignment, and lack of clarity we are facing now.
Finally, the Palmyra case is a strong reminder that the DAO must establish a clear exit mechanism for projects that fail to deliver according to plan.
Without such a safeguard, stalled or inactive projects can erode both funding efficiency and community trust.
Thanks for taking the time to review the proposal and chime in about it.
I share your viewpoint that short-term holders should be heard, but that the voice of a long-term holder is worth more consideration. The concern I have is that the 30-day lockup requirement of the DAO has shown that it is a much bigger deterrent than many anticipated. Some of the strongest long-term supporters in our community will not use the DAO because they are unwilling to sacrifice liquidity.
At the same time, we need to recognize that participation in governance is in itself time-consuming. As you have noted yourself, not everyone will be able to dedicate enough time to understanding every issue well enough to have a strong stance. However, it is much more likely that a representative will be a long-term supporter since they probably wouldn’t get much power delegated to them otherwise.
The section on Voting Power is in part an attempt to shield the system from short-term attacks while also offering an avenue for those who refuse to use the Nervos DAO an avenue to vote without the 30-day lockup but with a vote power penalty which is equivalent to the 30-day lockup.
Another avenue that has been mentioned several times is to give stronger voting power to those who have been holding longer. There is merit to this concept, but also things to consider. A whale could gain a disproportionate amount of power over time. Another thing to consider is that the interest paid in the Nervos DAO is inherently increasing their voting power already.
I would like to hear more thoughts on the topic from yourself and others. I’m not at all against the general concept as long as the implementation has a long enough successful track record to ensure it isn’t experimental, and that it doesn’t rely heavily on magic numbers.
Lastly, I want to point out that the treasury mechanism I suggested does not forbid multiple DAOs to co-exist simultaneously. CKB is designed to accommodate an ever-evolving landscape. There is no reason our DAO cannot do the same.
I think the sample size of data available is rather limited to make any widespread conclusions, but if you wish to lead that review in a public forum I would be willing to participate.
I completely agree that there is a need for accountability. This is why there is a milestone requirement and why there are several DAO Roles that are there specifically to ensure that qualified persons can conduct milestone review.
Additionally, I will be adding another soft rule to address this edge case that states that projects that receive a down payment and do not make any attempt to do the work they promised must return said funds or face legal consequences.
Unfortunately, there is no way to guarantee completely that some bad actors will not get away with some money. One party must take the initiative and offer limited trust in order to get past the initial commitment problem, and the party to take that risk will be the DAO. Past that, we must rely on the judgment of the community and representatives to make informed decisions when evaluating applicants. I would also like to produce some materials to help guide those who are new to the grant review process, but this is an effort that will come at a later time.
Reviews will be conducted by appointees to the DAO Roles.
As I stated in your thread, I am strongly opposed to this proposal. It introduces restrictions on normal business operations without improving outcomes.
I’ve been in contact with the ZenGate team and they are behind schedule but have full intent to move forward with their obligation. Additionally, they have been exceptionally helpful in helping to establish relationships with other teams in ways that are not visible publicly. I consider them to be one of the strongest community partnerships we have.
Technical reviews will be conducted by appointees to the DAO Roles. I dislike the randomized aspect because it ignores the simple reality that many of the technically competent people in the ecosystem are focused on specific areas of interest. The technical reviewer will need to be determined at the time it needs to be done so we can assign the most competent person who is also available.
My suggestion was to allow USD or CKB accounting. Is your suggestion to only allow USD based accounting until a later date, and then open up CKB accounting?
I see the feasibility assessment as a particularly difficult one since we work in a rapidly evolving industry with many unexpected stories of success and failure. With that said, it is worth continuing the discussion on feasibility assessment to complement the technical assessment for large projects in the future.
I understand the problem you are trying to solve, but I disagree with these requirements because it attempts to micromanage the business process. It is not the role of the DAO to determine how much an individual is paid per hour, nor is it the DAOs place to discriminate on teams based on their origin. The concern of the DAO is the value delivered and the cost thereof. This must be judged externally as a cost-benefit analysis for the total project.
As I have stated in the past, I believe that every proposal should be scrutinized regardless of who proposed it. The community as a whole has been pretty consistent with this, but I believe it would still be beneficial to have additional materials that make recommendations to help with this process.
Infrastructure grants have been handled by funds outside of the Community Fund DAO. However, this responsibility will eventually fall on the community as well. I believe it will be some time before this is needed, but I do believe in the future this should be a topic of discussion.
Project milestone and review requirements already cover exit scenarios, except for the down payment. I believe with a few additional rules we can create better boundaries for expectation, which can then be evaluated by appointees and decided on by vote.
Thank you for the time and effort you have put into these recommendations. Even if we do not agree on all issues, I can see that you have put a considerable amount of thought into this.
This is good point, but I think this is why a longer timeframe is better.
If the timeframe is 3 or 4 years until you reach the peak of the extra ‘power’, then the voting weight can be increased very slowly to a reasonable amount like 5x or even 10x, rather than a rapid increase over 30 days.
I don’t think whales who have proven they haven’t dumped their stack for 4 years as being a problem, they are most likely highly invested in CKB going down the right path.
“The concern I have is that the 30-day lockup requirement of the DAO has shown that it is a much bigger deterrent than many anticipated.”
I’ve been a supporter and miner of Nervos since 2021. While I do appreciate the Nervos DAO, the 30-day lockup period discourages me from participating.
As a trader, I can often achieve a 2% gain in a single 5-minute trade, making the lockup’s risk-reward ratio unattractive. Revisiting the 30-day lockup duration could make the DAO more appealing to traders like me.
For example: “Maybe something like, stake/unstake anytime and collect the rewards for the duration your ckb was staked, but if you want voting rights, you must keep your ckb locked for 30 days +/- etc”.
The DAO is for a specific purpose, to protect SOV holders from inflation.
It’s not designed to just give CKB away to people who can’t even commit to not sell their CKB for 30 days.
If there was no commitment period, then the amount of CKB staked in the DAO would be even higher which means more inflation now and less CKB into the Treasury in the future.
So imo we don’t want to encourage more DAO staking, the more liquid CKB the better.
There is merit to the concept of giving additional voting power to long-term holders, but it also introduces challenges. Any large holder, such as a whale or a VC, could easily hold for several years and gain a disproportionate amount of power which becomes difficult to challenge.
Those who choose to use the Nervos DAO long-term are already increasing their voting power over time.
This topic has been brought up a few times. I don’t immediately see an obvious solution. I’ll keep it noted as an open topic needing more discussion.
With the current DAO, the the proposer is forced to gamble with long-term milestone based projects. If the price goes up they get a windfall payment on completion. If the price goes down they could choose to walk away from the project rather than accept partial payment. This does not work at all for many businesses.
I agree that in many cases it doesn’t make sense to allow CKB based accounting with this much volatility. I’m not strongly opposed to removing that option entirely, as you suggested, but it is worth more discussion. I will keep this topic open for more discussion as well.
I’m concerned that increasing the voting weight by 5x-10x would lead to an oligarchy. Some investment firms target long-term time scales; sometimes decades. It might actually be easier for them to hold for a period of 3-4 years.
I’ve been thinking of it from the perspective that long term holders of CKB in holding amount brackets being able to compete with others in that same bracket.
For example a longterm holder with 100K could eventually carry the same weight as a new holder who just purchased 500K CKB.
The holder with 100k was never going to be able to compete with someone who holds 5 million and obviously they never should either, there should always be a natural advantage to people who are risking more capital.
It’s a hard one for sure and I’ll admit I need to think this through more, because you’re right, this could easily lead to a bad outcome if not implemented properly.
Unlike the voting weight concept, which has lots of ins and outs and things to consider, I really think this one is straightforward.
I just can’t think of any advantage to paying the funds in CKB, its far too risky and I see no advantage to the Community Fund.
If we assume that every project is going to hit all milestones, then we should just convert the complete amount to USDI on a successful proposal.
If the price goes up, then it doesn’t matter anyway, because we were going to have to pay out the total CKB either way.
If the price goes down, then it also doesn’t matter because the project still receives all of the required funds.
The only real downside I can think of is if we swapped all of the CKB to USDI and the price goes up and the project also fails and doesn’t complete the milestones, then we have less value.
But I think we have to take a positive mindset and assume all projects will complete and if they are legitimately having problems then we should do all we can do to help them out.
Goal: A Truly Decentralized Project Application & Governance Platform
One Final Note: Do I Have a Personal Agenda? Yes — I Want a Healthy DAO
