SIP-2
SIP-002: Formal Establishment of the Symmio DAO Authors: Lafa, Jack Knutson Date: 12/11/2024 Status: Proposed
Summary
This SIP formally establishes the Symmio DAO as a decentralized governance body. It defines the DAO’s governance structure, operational framework, and procedures for submitting and voting on proposals, in line with the Symmio DAO Constitution. The DAO will be the primary decision-making entity responsible for managing the treasury, advancing Symmio’s mission, and overseeing all decentralized projects within the Symmio ecosystem.
Motivation
To formalize the decentralized governance framework, empower token holders, and enable transparent, on-chain decision-making, this SIP is crucial for the legal and functional foundation of the Symmio DAO. This proposal aims to activate Symmio’s decentralized governance by enabling SYMM token holders to participate in decision-making processes.
Specifications
1. Symmio DAO Formation
The Symmio DAO is hereby established as a decentralized, token-based governance entity. Its primary purpose is to manage the Symmio ecosystem by voting on and enacting binding DAO Resolutions in accordance with the Symmio DAO Constitution and Articles of Association.
2. Token Holder Governance
Token holders of SYMM, who stake their tokens in the designated governance contract, are deemed “beneficiaries” and can participate in DAO activities, including:
Proposing new governance changes.
Voting on active proposals.
Receiving benefits distributed from the DAO Treasury.
3. Proposal Submission Process
The process for submitting, discussing, voting on, and executing proposals within the Symmio DAO will follow a clear lifecycle to ensure community participation and transparent decision-making. The stages of this lifecycle are outlined as follows:
3.1 Forum Discussion
A Symmio community member may post a potential proposal in the Symmio DAO governance forums. This phase encourages open dialogue and feedback from other community members. Active engagement in meta-governance discussions via forums and Discord is recommended to gain support and improve the proposal.
Moderation: No minimum token threshold is required to initiate a discussion. However, community moderators reserve the right to moderate and remove spam proposals during this stage.
3.2 Temperature Check
Once a proposal garners sufficient community discussion and support, it may move to an off-chain Temperature Check via a snapshot vote. The purpose of this phase is to gauge whether the proposal has enough backing to proceed. Proposals that pass the Temperature Check with majority support can advance to the next stage.
3.3 Proposal Creation
A community member with sufficient voting weight (holding at least 1,000,000 SYMM) submits the proposal on-chain. This triggers a 2-day delay period before voting officially begins, allowing the community to prepare for the vote.
3.4 Vote Period
The voting period lasts for 10 days. During this time, SYMM token holders may vote for or against the proposal. For a proposal to pass:
It must meet the required quorum, which is defined as at least 33% of the current circulating SYMM token supply.
If the proposal fails to meet quorum or receives majority opposition, it will be canceled. Proposers and supporters may revise and resubmit a sufficiently modified proposal in accordance with the guidelines from previous stages.
3.5 Timelock Period
Once a proposal is approved, it will enter a Timelock Period of 2 days. During this time, the proposal is queued for execution, providing a final delay to ensure the community has an opportunity to raise any concerns.
3.6 Execution
After the timelock delay has passed, the approved proposal can be executed. Any community member can interact with the governance contracts to execute the proposal on-chain.
Deviations in the Proposal Lifecycle
Council Vetos
During the on-chain voting phase, the Security Council has the authority to veto any proposal if it is deemed harmful or dangerous. This measure provides an additional layer of protection against malicious proposals.
While the Security Council has the authority to veto any proposal during the on-chain voting phase if it is deemed harmful or dangerous, this authority does not extend to proposals aimed at abolishing or modifying the Security Council itself.
Late Quorum Prevention
The voting period may be extended if quorum is reached late. If a proposal achieves quorum less than 2 days before the deadline, the voting period will be automatically extended by an additional 2 days to prevent governance attacks that attempt to meet quorum at the last minute.
Off-chain Proposals
Certain proposals, such as elections or other administrative matters, may not involve any on-chain actions. These proposals will be voted on off-chain via a Snapshot vote. Regular off-chain proposals will have a 5-day voting period, while elections will have a 7-day voting period.
4. Voting Mechanism
SYMM token holders will vote on proposals.
A simple majority (50% +1) of participating votes will be required for a proposal to pass, provided that a quorum of at least 33% of the current circulating SYMM token supply.
Votes can be cast through the designated governance interface on Symmio’s on-chain platform.
5. DAO Treasury Management
The Symmio DAO Treasury will hold SYMM tokens and other cryptocurrencies, which may be allocated by DAO Resolutions.
The DAO will have the authority to manage and disburse funds for the purposes of grants, bounties, research, and business development in support of the Symmio project.
Treasury disbursements will be made in accordance with Article 2, Section 3 of the Constitution, ensuring transparency and accountability through periodic reporting.
6. Board of Directors
The Symmio Foundation will appoint an initial Board of Directors as outlined in the Constitution.
Directors will implement DAO Resolutions in compliance with the legal framework of the Cayman Islands and the DAO’s operational governance.
Future Directors can be elected, and current Directors removed, through a DAO Resolution.
7. Amendments to the Constitution
Any proposed amendments to the Symmio DAO Constitution must be submitted as a SIP and require a two-thirds majority vote of all participating beneficiaries.
8. Security Council
The Security Council is hereby established as a committee of 8 members who will serve as signers of a multi-signature wallet, responsible for executing both Emergency Actions and Non-Emergency Actions as delegated by the Symmio DAO. The Security Council will uphold the integrity of the Symmio DAO Constitution and will ensure the continued secure and stable operation of the DAO and associated blockchain networks. The powers and existence of the Security Council can be modified or eliminated through a Symmio Improvement Proposal (SIP) approved by the Symmio DAO.
Equivalent multi-signature contracts will be deployed across relevant chains governed by the Symmio DAO.
8.1. Emergency Actions
The Security Council is authorized to take immediate action in response to any security emergency that could significantly compromise the integrity, confidentiality, or availability of the Symmio blockchain or any system governed by the Symmio DAO.
These actions (“Emergency Actions”) may include software upgrades, transaction rollbacks, or other necessary interventions to mitigate the emergency.
Emergency Actions will require a 6-of-8 approval from the Security Council members.
Emergency Actions should only be employed in true security emergencies, such as critical vulnerabilities or exploits.
Following the resolution of an emergency, the Security Council must release a full transparency report explaining the emergency and the actions taken to mitigate it, once it is deemed safe to do so.
The Symmio DAO retains the authority to modify or eliminate the Security Council’s power to perform Emergency Actions through a valid DAO Resolution (SIP).
8.2. Non-Emergency Actions
The Security Council is also authorized to implement routine software upgrades, conduct system maintenance, and make other non-urgent adjustments (“Non-Emergency Actions”).
Non-Emergency Actions will also require 6-of-8 approval from the Security Council.
Approved Non-Emergency Actions will bypass the early stages of the proposal process and will proceed directly to the final stages (Phases 4 to 7) of the proposal review process, incorporating a delay before deployment to ensure sufficient time for review.
The Security Council may impose additional delays before deploying a Non-Emergency Action as deemed necessary.
The Symmio DAO reserves the right to alter or revoke the Security Council’s authority over Non-Emergency Actions via an approved SIP.
Founding Cohort
Lafa - Founder of Symmio
Levy - Founder of IntentX
Huf - Founder of Pear Protocol
Matt - Magnus Capital
Mazzett - Backed Protocol
Ross - Muon Network
Hedzed - CTO of Symmio
Jack - BD + Ops at Symmio
9. Establishment Costs
The initial costs associated with the formation of the Symmio Foundation and Symmio DAO include legal fees, administrative expenses, and registration charges required to ensure the organization’s proper setup and regulatory compliance. These expenses will be reimbursed to the service providers facilitating the establishment of the DAO and Foundation. The total amount of these expenses is estimated at $250,000 (referred to as the “Total Establishment Costs”).
10. Liquidity Incentives Allocation Plan
To foster liquidity and promote the growth of the Symmio ecosystem, 132 million $SYMM tokens have been allocated for liquidity incentives. These tokens will be used to encourage market participation, reward liquidity providers (LPs), and support other strategic initiatives as governed by the Symmio DAO.
10.1. Allocation Overview
The total liquidity incentives allocation is as follows:
33 million $SYMM: Allocated for LP incentives for 2025 and 2026, approved in SIP-1. This allocation includes:
A 25% annual inflation rate, amounting to 16,500,000 $SYMM per year, to incentivize LPs to provide liquidity.
84 million $SYMM: Proposed for LP incentives for 2023 through 2026. Specific strategies for these years will require additional DAO votes.
15 million $SYMM: Allocated for community airdrops to increase adoption and reward early participants.
10.2. Governance and Execution
TGE and Initial LP Setup: SIP-1 included the directive to proceed with the token generation event (TGE), launching $SYMM as an ERC-20 token on Base and creating an Aerodrome Finance liquidity pool in a 50/50 ratio of SYMM/ETH. A total of 16,500,000 $SYMM from the first year’s inflation was dedicated to incentivizing liquidity providers.
Ongoing Incentives: Subsequent liquidity incentives will follow similar principles, with proposals detailing exact distributions and mechanisms submitted for DAO approval.
10.3. Airdrops and Strategic Use
Airdrops: The 15 million $SYMM allocated for airdrops will be distributed to early adopters and key stakeholders based on criteria defined by the Symmio DAO, such as holding certain assets or engaging in specific ecosystem activities.
Strategic Initiatives: The remaining tokens, including the 79 million $SYMM for 2023-2026, will be available for market-making incentives, previously agreed-upon deals, and other growth-focused initiatives, with community oversight.
10.4. Reporting and Adjustments
Regular reports on the performance of liquidity programs, token utilization, and remaining allocations will be published for community review.
Adjustments to the incentive structure, if necessary, must be proposed and approved via the DAO governance process.
Justification
Establishing the Symmio DAO is essential for the decentralized governance and operational autonomy of the Symmio ecosystem. The DAO will provide a structured approach for managing the project’s development, fostering community participation, and ensuring the sustainable growth of the ecosystem through transparent governance.
Implementation
Upon approval of this SIP, the following steps will be undertaken:
Deployment of the Symmio governance contract.
Initiation of the SYMM token staking mechanism for voting rights.
Activation of the DAO Treasury and the proposal submission interface.
Appointment of the initial Board of Directors, with elections to follow in accordance with the Constitution.
Timeline
Week 1-2: Deploy governance contracts and activate staking.
Week 2-3: Initiate DAO voting and proposal submission mechanisms.
Week 4: Appoint the initial Board of Directors and open the treasury for approved proposals.
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