[Quick Note] On Index Coop Autonomy

This is a quick note on Index Coop autonomy.

The goal is to make Set Protocol’s intentions clear, as well as our current actions.

It occurred to me after a conversation with @Matthew_Graham that these intentions may not be clear.


Rough Vision:

  • The Index Coop DAO can fully-operate, independent of Set Protocol.
  • Set Protocol is an active community contributor working within the Index Coop ecosystem.

What are we doing today?

  • A priority within Set is to produce a clear articulation of the path towards Index Coop autonomy.
  • This ^ does not exist today.
  • It may include things such as:
    • The vision
    • Current blockers/bottlenecks/points-of-reliance
    • Failure points to avoid
    • Gameplan

Next Steps

Once ready, we will share a clear articulation of the path as we see it.

We intend to have this ready on a scale of weeks.

Request for feedback

What is unclear about our intentions?

What questions do you have around how Set Protocol supports Index Coop today?

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Thank you for the update, @gregdocter- Glad to hear this is a priority for the Set team!

Having this information available will help IC contributors step-up and take progressively take more and more responsibility for operating the DAO.

Articulating the vision will be tremendously valuable for reducing the uncertainty community members are feeling. In particular, (and you already know this) TWG and releasing new products are big pain points right now. Currently, TWG is waiting to allocate funds to their best use and Methodologists are waiting to release new products.

Excited to see the vision and work towards it together as partners!

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This will be something that is useful to have on record, although maybe not easy to specify. Currently, Set’s involvement, important as it is, is something that you come to organically understand over time and which is a little more difficult now than it used to be when Inje and Felix were helping get the community up and running.

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Great to hear this and look forward to seeing the vision and plan @gregdocter

Thanks

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There was some really healthy discussion about this on the Org call (7/7/21) but I’d like to just expand on that a bit here.

As I see it, the lack of ‘autonomy’ at INDEX launch is becoming an issue in the contributor consciousness, having an impact on morale, and challenging the ethos of what a ‘DAO’ is. INDEX was launched as a governance token, not a DAO (the word ‘DAO’ does not appear in that initial post; ‘Decentralized Organization’ does . . . IC was not conceived as an autonomous entity). We have grown over time into something that wasn’t initially contemplated - IC was conceived as a marketing arm for Set and is now outgrowing that mandate - so how do we move forward?

Establish what areas IC currently has autonomy (per the original Medium article):

The INDEX Governance Token

The Index Coop has launched with a native token (ERC20) called INDEX that binds the Index Coop with its holders, enabling community-led ownership and governance. To facilitate sustainable growth, INDEX holders are responsible for important decisions including:

  • Adding Indices: INDEX holders are responsible for sourcing, developing, and supporting new index strategies that have broad market appeal.
  • Controlling the Community Treasury: To attract a robust set of participants and methodologists, INDEX holders will devise incentive programs to attract and retain index methodologists, liquidity providers, marketers, community, developers, and other experts.
  • Updating Fee Configurations: In the traditional financial world, index vehicles monetize through an expense ratio/management fee and/or via asset lending. To enable sustainability, the community will be responsible for finding the correct balance in deploying value accrual mechanisms.
  • Enhancing Indice Performance: As components in indices can be used in governance, staked, or lent, INDEX holders will be responsible for determining how to best allocate constituent assets for achieving greatest yield, proper influence, or to satisfy other community-determined goals.

This mandate is fairly narrow, so, have IIPs expanded it?
The short answer is, ‘no’ or ‘not much’ - operationally IC is still a marketing arm for Set. I have put together an IIP resource in the Community Handbook to show how IIPs have shaped the areas of Governance<>Community<>Treasury<>Product

What is The Coop contributor community doing now that isn’t in the original mandate? What are we looking to do?
This is the challenge and what I think @gregdocter is looking to drive forward; I’m in full support.

The path forward:
As I see it, there are no ‘blockers’ to going from ‘DO’ to ‘DAO’; just some required hard work and communication. Other than agreeing to what it is that we’d like our community to look like and passing the required IIPs to make that explicit, we’re very much in control of our own destiny. As I see it, IC was conceived by TokenSets and wouldn’t be here were it not for that ideation - they established an allocation of governance tokens that are becoming more distributed over time, and despite their large governance power, Set are unlikely to kill (or even stifle) the golden goose just because it wants to spread it’s wings. I think this is a case of being in violent agreement on most things, and just fleshing out what a full handover of operational control looks like.

As a side note, I believe Set has a window to cede control (outside of governance) according to The Howey Test . . . I’m not well-versed in this area, but it may be relevant so raising it here.

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@gregdocter As discussed during today’s org meeting, I’m adding a quick note here to add making Index Coop contributors as IIP editors so that the Index Cooperative is not reliant on Set to post proposals/governance votes:

As you’ve noted, @Pepperoni_Joe is a contributor who may be interested in becoming an IIP editor:

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thanks for the push and this note :+1:

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