RFC: Increase the amount of self-bond to 1000 CFG for creating an on-chain proposal

Centrifuge Governance Proposals
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The last couple of months we have seen too many proposals on the Centrifuge chain with malicious intentions. Some examples are here:

Proposal #15: (increase validator count by 12)
Proposal #16: (increase validator count by 40)
Proposal #19: (cancel queued referendum #37)
Proposal #20: (cancel referendum #37)

Referendum #37 (adjusting CFG rewards) is something that had been thoroughly discussed in the Forum here and it passed with SuperMajorityApprove.

These proposals have not been beneficial to the network and some of them could potentially have compromised the chain security. The majority of the aforementioned proposals have not followed the governance guidelines either, by starting a discussion here in the Forum, but have just been submitted without getting feedback from the community.

The current amount of self-bond to create an on-chain proposal is 10 CFG (currently around 4.9 $). To put it into perspective, the cost of creating a proposal on other Polkadot parachains is:

Acala = 200 ACA (≈ 216 $)
Clover = 100 CLV (≈ 29$)
Efinity = 100 000 EFI (≈ 34 000 $) source → Governance | Efinity Whitepaper
Moonbeam = 400 GLMR (≈ 880$)

In order to minimize these kind of spam/protest proposals, I want to suggest to increase the amount of self-bond to 1000 CFG.

I am aware that this could prevent some token holders from submitting a proposal/seconding a proposal, but it does not affect their ability to vote on referenda. If someone does not have 1000 CFG to submit a proposal on-chain, but still has an idea to a change, it should not prevent them from proceeding. This will just require to follow the best practice for governance.

If the proposal is genuine, beneficial to the network and there is enough support for it, there is the option to get the council to create the proposal - or someone else from the community could take on the task.

In any case, it would require a proposal to be discussed properly in the Forum before just creating them on-chain.

I would like to hear what other community members think of this. Also whether the amount is too high/low.

Looking forward hearing from you.

Rhano

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Hi Rhano.

In my opinion everyone who proposes an on-chain referendum should show “enough skin in the game” and raising the amount to submit a proposal should be worth it and proves who supports the ecosystem.

Although I support the idea, I highly recommend - in case of a positive outcome - to re-evaluate the amount in the future.

At the current token price 1000 CFG is a reasonable amount but it would cost much more with an appreciated price in the future.

A higher threshold shouldn’t discourage smaller token holders to to submit a proposal

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Good day, Rhano!
I guess that 1000 CFG is not enough and we should increase the amount of self-bond up to 5000 CFG.

This amount of CFG will force people to read and follow the governance guidelines first.

And users who don’t have min amount to create the proposal after following governance guidelines could be supported by any Community Member, Ambassador, Councilors or Team.

Increasing of min amount will give to all only benefit all:

  1. Will teach users to firstly read and understand the governance process and guidelines.
  2. Will stop malicious, undescribed, and undiscussed proposals and referenda.
    :wink: :sunglasses:
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Yes, the “skin in the game” is certainly an important factor. It is also important to remember, that the self-bond is not lost - it will be returned to the proposer once the proposal becomes a referendum.

However, the council/technical committee has the power to cancel malicious proposals and if they decide to do so, the self-bond will be forfeit/burned and hence lost.

I agree that this amount should be revised again in the future - especially in case of price volatility of the CFG token. For now, I personally believe it is important to address this issue with malicious proposals asap and increasing the amount of self-bond is the best solution I can think of.

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For both myself and for anyone reading: @Rhano — how does the “self-bond” work? Is the CFG received back or is it forfeit, or does it depend on the outcome? If so how does it depend? This I believe is important in considering this proposal.

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Hi @devin, yes a very important question and I will clarify.

When someone creates a proposal on-chain, they currently bond 10 CFG. Other token holders can then second this proposal by bonding the exact same amount of CFG (10). Everyone who has seconded a proposal (including the proposer) will get this CFG back once the proposal has turned into a referendum - their bond is NOT forfeit, only locked for the duration of the proposal.

Therefore, it might be a bit misleading talking about a “cost” of a proposal - it would probably be more accurate to describe as some kind of a deposit for your proposal until it becomes a referendum.

The only time a self-bond can be forfeit is if the proposal is cancelled by the council (if it is deemed malicious for example) - then the amount is burned.

Hopefully that shed some light on the matter.

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Thanks for the explanation and clarification. As always lies “the devil in the details”.

Are you going to move forward with the poll or do you want to wait for further comments?

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I would like to get some more feedback before proceeding to a poll, preferably 2-3 days more so others can weigh in too.

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i’m definitely in support of this as it’ll increase the threshold and ensure that there is more conviction behind the proposal, and is still a reasonable enough number to give nearly all community members the chance to propose.

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@Fabien @SYZ @alex_forshaw any comments you’d like to make here?

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I do not agree with the proposal made to prevent the community from actively participating in the management. If accepted, I will increase my reserved cfg count and offer more aggressive offers :joy:

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Hello. Thank you for bringing this topic up. I agree that spamming proposals can become an issue especially if it risks the security of the protocol. I’m surprised this scenario wasn’t brought up before.

There seems to be a safe guard in place by the council/technical committee to prevent malicious proposals to cause harm, which is reassuring. Since this same committee has the power to burn/forfeit members’ CFG, would it be beneficial to define what it means for a proposal to be considered a spammy and malicious? That way there is a disclaimer that CFG can be lost permanently.

It is difficult to determine the appropriate threshold that would discourage bad actors and not be too high for good actors to participate in governance.

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My recommendation is 100,000 cfg. Because I have $50,000 in the stock market and enough to continue my protests. Since the project can be evaluated in the future, giving a referendum every week provides a mandatory hold for me. I think you should think about it :slight_smile:

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I support the increase in the minimum self-bond to 1000, if a proposer can’t meet the minimum self-bond then one of the council members or a community member could submit the proposal on-chain on their behalf (assuming it followed the appropriate off-chain procedure and was approved after discussion on the forum).

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Why did you decide that I was malicious? Protests cannot be malicious. Democracies also have room for protests. The purpose of the protest is to correct and improve the unpleasant actions of the team or ambassador. Protest votes show the team that it is underworking and needs to work harder. For example, the constant price decreases, the absence of agreements to increase TVL, the absence of the promised TVL increase in the ICO process, and a racist statement by a moderator towards Turks are the reasons why I continue my protests. All my protests are well-intentioned and aimed at improving the project. I also voted no in my proposal to cancel the 37th referendum. If I was a malicious person, don’t you think I would vote yes?

My thoughts on this referendum proposal;
You don’t want to hear any sentence criticizing you. It’s like turning off the telegram group to talk. Because you don’t care about democracy at all. I see it as an ill-intentioned offer to block the way for democracy. Keep talking by saying that we are not centralized. Who would believe? :wink:

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If you read my comment above my recommendation is to revise the bonding amount in the future to avoid small token holders to be excluded from creating proposals.

Rhano is in accordance with that

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Exactly, Ash. That’s one of the functions the council stands for

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Hi @TurkValidator, thank you for contributing to the discussion.

Increasing the validator count by 40 is indeed a malicious proposal, in my opinion, and it could have potentially affected chain security. I guess we look at this situation differently, you and I, which is ok - there is room for disagreements in a democracy. And this is exactly why I bring it up here in the Forum and hear opinions of other community members - instead of going ahead and proposing the change on-chain straight away.

I don’t agree with this; the team is constantly working and the updates given on the Centrifuge chain is a testimony of that. Token price and progress are not always correlated so bringing a decrease in price is not relevant in this situation.

I am sorry to say, but voting no to your own proposal does not justify creating it in the first place.

This is not true either - right now you are voicing your opinion here in the Forum like everyone else. And in the end, the token holders will vote on this and we will have to accept the outcome, regardless of whether we agree or not.

I am glad to hear that you hold a lot of CFG - you picked a good project. However, it is also important to keep in my mind that if the council finds a proposal harmful to the network, they have the option to cancel it and in that case, the amount of self-bond will be forfeit (i.e. burned). So if someone has self-bonded 100 000 CFG to a proposal and the proposal is malicious, they will lose that CFG. That is also something to keep in mind.

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Merhaba Serkan. This proposal is malicious because it endangers the network’s stability.

[Proposal: Increasing the number of validators to 95]

You as a validator yourself should know that very well

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Thank for joining the discussion @MiniQ!

You bring up a good point in defining what makes a proposal malicious. It can be tricky to define some clear guidelines as to when a proposal is malicious - in most cases it comes down to common sense. But even common sense can appear to be very subjective. However, proposing something like increasing the amount of validators by 40 is an obvious attempt to harm the network, in my opinion.

Also cancelling a referendum that has already been discussed and voted on both off- and on-chain and passed with Super Majority Approval does not show good intentions either.

Not following the guidelines for governance is also a red flag in my book.

If you have any ideas to define what makes a proposal malicious to the network, please share them - because I do agree with you that it would be good to outline them. But in the end, this should not even be necessary as a common sense and the best interest in the network should prevail.

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