Proposal: KONG Land Senate Formation

Governance
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With the primary goal of establishing more efficient coordination of KONG Land efforts, this proposal calls for the formation of a KONG Land Senate as referenced in the KONG Land Trustless Unincorporated Nonprofit Association (UNA) - sections 1.6, 3.2, 3.3, 4.2, and 8.1.

Background

Thanks to the contributions of numerous $CITIZENs, KONG Land has made a great deal of progress on many fronts, from opening its doors for citizenship, establishing the UNA and a Founding Charter, introducing a new version of its public good chip technology (SiLo v1, HaLo v2), supporting existing integrators and establishing new partnerships, cultivating an initial sub-DAO ecosystem, successfully voting to create an economic $LAND token, improving project awareness, and continuing to build its community and strengthening engagement. While we should all be very proud of our success thus far, we should also recognize the realistic challenges of organizing, coordinating, and motivating a decentralized group of individuals towards the KONG Land mission to bridge the physical world to the digital metaverse through the global adoption of its public good chip technology.

Proposal

The following lays out the requirements and terms for Senators, their nomination and election process, proposed compensation, scope of responsibilities, and the processes for expulsion, and exceptions. It’s important to note that any component of this proposal may be adjusted in the future via a successful Snapshot vote.

Requirements and Elected Term

  • Senators must be KONG Land $CITIZENs in good standing.
  • To be nominated for a Senate seat, an individual must be a $CITIZEN for at least three (3) months from the time they acquired citizenship, whether via $CITIZEN/$CTZN redemption or purchase/transfer of a Citizen ERC721 token.
  • Senators must retain their Citizen ERC721 token for the duration of their term.
  • Senators must remain active throughout their entire term and fulfill all duties as identified in this proposal.
  • Senators will serve one (1) year terms, and six (6) senators will be elected per term.
  • There is no limit to the number of consecutive terms a senator can serve as long as they continue to be elected into office by $CITIZENs.

Nomination and Election Process

  • The nomination and election process will initiate one (1) month prior to the end of the current Senate term.
  • Nominations for an upcoming Senate term will be solicited at least two (2) weeks before the election vote on the KONG Land forum.
  • Individuals may nominate themselves or other $CITIZENs. Anyone nominated by someone else will need to confirm that they want to run for a Senate seat.
  • Once the nomination period is closed, there will be a one (1) week “campaigning period” wherein nominated candidates share why they feel they should be elected into the Senate. A dedicated Discord channel will be created for this purpose and be kept open until the end of the election.
  • After the campaigning period, a Snapshot vote will be created with a voting period of one (1) week. The vote will include all nominated $CITIZENs and use a weighted voting system.
  • Once the election vote ends, results will be shared on the forum, and new Senators will be immediately transitioned in by the previous administration.

Compensation

  • Senators will be compensated 1M $LAND each for their one (1) year term of service.
    • This compensation amount only applies to the inaugural Senate term.
    • Compensation can be claimed by Senators on a monthly basis.
  • Annual recalibrations
    • Senator compensation will be revisited annually as the market for $LAND matures. The purpose of the recalibration is to ensure that Senators are properly recognized for their contributions and incentivized to do good work.
    • The Senate can make an adjustment recommendation for themselves as long as $CITIZENs are allowed to review the financial model used and the adjustments are approved via a Snapshot vote.

Scope of Responsibilities

The primary role of the Senate is to aid in facilitating coordination and ensure the efficient operations of KONG Land at the behest or pleasure of $CITIZENs.

The Senate CANNOT make unilateral decisions on matters that may impact the following without consulting $CITIZENs and conducting a governance vote:

  • Existing Tokens ($CITIZEN, $CTZN, $LAND)
  • Creation of new tokens
  • Any assets within the KONG Land Treasury above the thresholds dictated in this proposal or as amended in the future
  • Modification of the KONG Land UNA or Founding Charter
  • Any act that would seek to dissolve, amend or change the governing structures of KONG Land
  • Any changes relating to the scope of the Senate’s responsibilities and capabilities as dictated in this proposal
  • Any external arbitration mechanisms, protocols or laws, including but not limited to those mechanisms which arbitrate economic decisions. These arbitration mechanisms, such as decentralized courts, are to be selected, established and conducted by $CITIZENs.

The Senate’s scope of responsibilities include, but may not be limited to, the following functions:

  • Kong Land Exports
    • Chip development and fulfillment
    • Smart Contracts and apps
    • Associated app design
  • $CITZENs
    • Immigration
    • Community building and events
    • Chip support
    • Internal, non-economic arbitration between $CITIZENs as administered by the Guardians of Kong
  • Kong Land Development Agencies
    • Marketing and communications
    • Business development and DAO to DAO relations
    • Design (print and digital)
  • Kong Land Treasury
    • Treasury management
    • Multi-sig ownership and execution
    • Finance and accounting
    • Propose $LAND, $CTZN and other token related policies for vote by $CITIZENs

The Senate may secure help necessary to fulfill the above functions, including creating grants and bounties, new organizational roles and their compensation structures, software and tooling, etc., as long as they are within the levels of discretion detailed in the section below.

Levels of Discretion

While transparency should always be the guiding north star for all Senate operations, we must balance the need for transparency with the need to be efficient. To ensure that KONG Land can grow and prosper, the Senate must have a certain level of discretion to make decisions and spend treasury funds without the need to consult $CITIZENs or conduct a vote.

As stated in the KONG Land UNA, section 8.1, the senate “shall have the power to interpret this Constitution, apply them to particular circumstances, and adopt policies in furtherance of them, provided that all such actions are reasonable and consistent.” To further define what is considered reasonable, the following levels of discretion are proposed:

  • Spend treasury assets up to $50k USD per quarter, not to exceed more than 10% of the total $USD value of the treasury calculated at the time of spending.
    • Any transactions that exceed the $50k per transaction threshold or 10% per term spend cap must be voted on by $CITIZENs.
    • This threshold may be increased or decreased by a vote of $CITIZENs.
  • Distribute up to 50 $CTZN per quarter
    • While the framework used to distribute tokens does not require a Snapshot vote, the Senate must share the framework with $CITIZENs on the forum for their feedback.
    • Any sale of $CTZN tokens requires a Snapshot vote.
  • Any decisions that could impact existing tokens (i.e., supply, value, utility, etc.) must be communicated to and voted on by $CITIZENs.
  • Any decisions seeking to create new tokens must be proposed to and voted on by $CITIZENs.
  • Any decisions regarding the sale or disposition of other assets, such as a treasury diversification event, must be proposed and voted on by $CITIZENs.

Multisig Process

The Senate is responsible for the management of the treasury and its Gnosis multisig wallet. To use treasury funds or distribute $CTZN, 4 out of 6 Senators are required to sign each transaction. Senators may reimburse themselves for the exact gas spent on multisig transactions on a quarterly basis, also to be reported to $CITIZENs.

Financial Reporting Process

The Senate will create and share a quarterly summary report of treasury spending (example) and ensure a timely response to any questions raised by $CITIZENs.

Recall Process

If any $CITIZEN, including other Senators, feel that a Senator is not fulfilling their duties as described above, they may request a recall Snapshot vote. The process of requesting the expulsion is as follows:

  1. Create a recall request on the forum, clearly explaining the rationale for the request.
  2. Provide a period of one (1) month allowing $CITIZENs and the Senator(s) identified in the recall request to have civil discourse on the matter.
  3. If after this period the recall request is not retracted by the initiating party, carry out a Snapshot vote.

Exception Process

  • If a Senator voluntarily vacates their seat or is recalled, all compensation, roles, multisig access, etc. will be immediately revoked.
    • Loss of the $CITIZEN ERC721 token via transfer or sale will immediately vacate a Senator from their seat unless the act is merely to transfer the $CITIZEN token to a new wallet held by the Senator and they first communicate this action publicly on the forum. If this transfer is challenged, $CITIZENs may request an expedited recall of the Senator requiring only one (1) week of discourse on the forum.
  • The remaining Senators will decide whether it is necessary to replace the Senator at that time. If they determine it prudent to replace the Senator, an abbreviated nomination and election process will be held (half the time frames identified in the normal process).
  • The replacement Senator will be signed on only to the end of the existent term and receive prorated compensation based on when they start.

Definitions

For reference: UNA Sections Relating to the Formation of a Senate

  • SECTION 1.6 - KONG Land Codex. The KONG Land Codex serves as a handbook for governance procedures, policies and as a broader guide to the purposes and functions of KONG Land. It may be adopted through a majority vote of eligible Citizens. Amendments to the KONG Land Codex may be adopted through a majority vote of eligible Citizens or through a designated group such as the KONG Land Senate.
  • SECTION 2.6 - Inactive status. A Citizen who falls from good standing may have their membership revoked or suspended through the vote of Membership (each said action, a “Guild Kick/Member Removal”). References herein to the rights and entitlements of members shall be understood to refer only to members in good standing. Good standing will mean participating in at least one vote every two years within KONG Land and not conducting any criminal activity against KONG Land. The definition for good standing, including the minimum voting requirement of one vote every two years, may be updated from time to time as specified by the KONG Land Codex.
  • SECTION 3.2 - Special meetings. Special meetings of Citizens may be called by a designated group (the “KONG Land Senate”). The KONG Land Senate as described in Section 4.2 is not required and may never be formed. Creation and Designation of the KONG Land Senate will be approved via the Designated Smart Contract.
  • SECTION 3.3 -Time and place. The date, time and place of all meetings of the KONG Land Senate shall be determined by the KONG Land Senate or, in the event that the KONG Land Senate fails to act, by a call for vote via the Citizens.
  • SECTION 4.2 - KONG Land Senate. Should Citizens vote for a proposal creating the KONG Land Senate via the Designated Smart Contract, the structure, terms and means of selection of members of the KONG Land Senate (“Senators”) shall be enumerated in said proposal and recorded in the Codex. The KONG Land Senate structure, terms and means of selection of Senators may be amended by a vote of Citizens.
  • SECTION 8.1 - Interpretation. The KONG Land Senate (if formed via vote of Citizens) shall have the power to interpret this Constitution, apply them to particular circumstances, and adopt policies in furtherance of them, provided that all such actions are reasonable and consistent.
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Shoutout to citizens @cameron, @Digit, @pmg, @ramicaza, @grin, @alexhidalgo, @031, @K.9150, @cadillion who provided input on this and the previously posted Kong Land org framework that paved the way to this proposal! :raised_hands:

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What if they get hacked?

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Currently there is no $CITIZEN recovery mechanism; if you lose your token via a hack, you lose $CITIZENship. I think this is a broader question where we could devise a “claw back” function via the physical Passport, but as it stands we don’t have a solution here.

I don’t think it’s appropriate to solve this for the special case of Senators and not other $CITIZENs; I would imagine that provided with proof of a hack standing Senators would issue one of the 50 $CTZN they control to “cover” the loss for the Senator.

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@julio @cadillion @chingularity would love your input from the call today regarding multi-sig.

It sounds like the solution we landed on was 2x wallets: one that Senators can spend from, the other one a larger multi-sig which may or may not overlap with Senators.

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What would happen if there was a tie vote? I assume nothing and therefore the hurdle for taking an action would be 4 votes. Is this correct?

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I think having one main treasury and one treasury with the operating budget makes a ton of sense. The main one can be heavier on the security side with a much higher multi-sig signer requirement.

The operating budget’s treasury can have a much lower signer requirement in order to optimize for speed of transactions being initiated.

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Regarding the senate term lengths - my $0.02 is that they should be shorter than one year.

To recap what I said on the community call yesterday: There is no term limit for senators. Therefore this means that if someone is doing a great job 5 months into it, they’re likely to be re-elected. However if someone isn’t doing a good job 5 months into it, how likely is it that they will start getting their stride 6 or 7 months into it? Highly unlikely.

My suggestion is to make the terms 6 months. We’re going to lose candidates if the term length is as long as 1 year. An additional data point, the term length for the committee members at Orange DAO is 6 months.

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That’s reasonable to me.

Another question: how much is 1M $LAND? Is that a lot or a little or just right?

Seems premature to me to set payments in $LAND when it doesn’t exist yet. I think that’s the right move in the future and I think Senators should be well paid, but for now we should price the salary in ETH or USDC or something else that has a known value (even if it’s ultimately paid out in $LAND)

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$LAND hasn’t been distributed yet so there’s no way to value it. Outside of a few $CITIZEN and the remaining $CTZN (which also has no liquid market), the treasury currently has no other significant holdings that could fund the Senate’s operations. Even if $LAND was distributed in the very near future, there would likely be a lot of volatility in its market and converting into a different token to pay Senators would likely result in significant slippage.

Establishing the “right” compensation is bound to be a topic revisited regularly and it’s also proposed that Senator pay determination for the upcoming term is coupled with the election process.

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Thanks for your insights - super helpful! The concern around losing good candidates resonates with me and we can always shorten and streamline the nomination and campaigning process so the more frequent cycles doesn’t create additional overhead. o/c, that would mean the proposed 1M in $LAND comp. per Senator, per annual term > 500M $LAND per Senator, per 6-month term (at least for the initial term).

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Assuming you’re referring to the multisig requirement and not the election votes, the multisig isn’t a vote, it’s just how many Senators need to sign a TX that involves treasury spend or $CTZN distribution.

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Thank you for pulling this together. I agree this is a critical function in moving KONG Land DAO forward.

High-level feedback is to emphasize that Senators do not run KONG Land - $CITIZENS do. Thus, the role of Senators should be strategic direction, for a functional DAO structure, so $CITIZENS can grow, contribute, build, etc.

  1. Is there a justification for why voting is weighted?

  2. Why does compensation only apply to the inaugural Senate team? Governance is work, not a privilege for an elite few. It’s a fine balance between financial incentivisation and encouraging people to politic for roles. Perhaps the first tranche should not be paid? On the other hand, Zcash is an interesting example here. Colloquially, I’ve heard that Directors are paid but not enough to remain engaged given their competence and market value, which limits participation

  3. Is there an estimate of how much compensation will equate to? Board Directors are paid approximately $20k for their contributions (noting, clout and business opportunities which may not be valid here as intangible incentives). Also noting it’s fluctuating and adjusted.

  4. Are people responsible for assessing their own legal liability by participating, in line with the UNA?

  5. “The Senate’s scope of responsibilities include, but may not be limited to, the following functions:” This is incorrect. The Senate’s role is strategic direction, and structural enactment for the functional settings to achieve strategic purposes. The $CITIZENS and DAO does all these functions listed. Otherwise, KONG Land is limited to the capacity of a few, volunteer-ish people.

  6. Rather than recall votes (politics), can we think about structural mechanisms to limit Senate power via accountability? For example, Lido DAO has an “easy track” governance stream, where votes that don’t affect the entire DAO (i.e. operational functions) can easily pass but with transparency, while strategic, whole-of-DAO votes go through Aragon, to limit the volume of information and votes people have to participate in.
    There could also be scope to remove a Senator by unanimous Senator vote (if it’s obvious that they fail to contribute, without having to garner support from the entire DAO via politicking).

Again, the main goal is to align incentives to empower Senators to make strategic decisions to catalyze KONG Land as a functioning DAO ecosystem, ensure sufficient accountability, and limit legal liability.

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Thanks for the helpful feedback @K.9150! :pray:

  1. Is there a justification for why voting is weighted?

It’s to allow the election of all Senators in a single SnapShot vote vs. having to hold multiple votes. Open to suggestions on alternate voting structures.

  1. Why does compensation only apply to the inaugural Senate team? Governance is work, not a privilege for an elite few. It’s a fine balance between financial incentivisation and encouraging people to politic for roles. Perhaps the first tranche should not be paid? On the other hand, Zcash is an interesting example here. Colloquially, I’ve heard that Directors are paid but not enough to remain engaged given their competence and market value, which limits participation

Compensation for Senators will apply to all terms. The proposed amount is only applicable to the initial term as it’s likely to change as the market for $LAND evolves. I’ll tighten up the language in the actual proposal so it’s clearer.

  1. Is there an estimate of how much compensation will equate to? Board Directors are paid approximately $20k for their contributions (noting, clout and business opportunities which may not be valid here as intangible incentives). Also noting it’s fluctuating and adjusted.

I don’t see BODs as good proxies for compensation. I’ve seen their pay well-exceed $20k, and I anticipate Senators will put in more work than any board member. That said, hard to say what is this initial compensation will amount to until a liquid market for $LAND emerges. I consider the initial compensation as a bit of an experiment. I expect that we’ll receive a ton of feedback from the initial group of Senators on compensation and other topics that will help shape how future Senate administrations are managed.

  1. Are people responsible for assessing their own legal liability by participating, in line with the UNA?

The proposal is aligned with the terms established in the UNA.

  1. “The Senate’s scope of responsibilities include, but may not be limited to, the following functions:” This is incorrect. The Senate’s role is strategic direction, and structural enactment for the functional settings to achieve strategic purposes. The $CITIZENS and DAO does all these functions listed. Otherwise, KONG Land is limited to the capacity of a few, volunteer-ish people.

Agree. Will adjust the language in the final proposal to reflect your suggestion.

  1. Rather than recall votes (politics), can we think about structural mechanisms to limit Senate power via accountability? For example, Lido DAO has an “easy track” governance stream, where votes that don’t affect the entire DAO (i.e. operational functions) can easily pass but with transparency, while strategic, whole-of-DAO votes go through Aragon, to limit the volume of information and votes people have to participate in.
    There could also be scope to remove a Senator by unanimous Senator vote (if it’s obvious that they fail to contribute, without having to garner support from the entire DAO via politicking).

While the recall process is far from elegant and definitely not final form, it allows us to move forward with the Senate proposal without being bogged down with implementing a technical solution that requires resources that Kong Land currently doesn’t have at its disposal. After the Senate is formed and a treasury exists, I anticipate we’ll find much better solutions to tackle this and other tricky functions, such as arbitration.

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Awesome feedback everyone - ty! Really encouraged by all the engagement on the proposal.

Here’s the schedule I see to get us from here to an actual Snapshot vote:

  • 5/9 - last call for feedback by EOD
  • 5/9 - requests Senator nominations via a separate forum thread and leave open until 4/15 EOD; will also create a temporary Discord channel for nomination discussions and campaigning
  • 5/10 - post v2 proposal incorporating feedback received and will leave open for additional feedback until 5/15 EOD
  • 5/16 - create a Snapshot vote for the Senate formation that will run for the default 3-day duration
  • 5/16 - create a Snapshot vote for the Senate compensation (currently proposed at 500M $LAND) for Term 1 that will run for the default 3-day duration
  • 5/16 - create a Snapshot vote for Senator elections that will run for the default 3-day duration
  • 5/19 - Senate formed and initial group of Senators elected :crossed_fingers:
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Senator nomination thread :point_down:

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My proposal for the multisig was a 9/12 multisig for the overall treasury and a 4/6 for the Senate discretionary budget.

We could increase the m/n for the master treasury if there are enough willing participants, but the simple majority would appear desirable for the purposes of the Senate address

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Thoughts on who should comprise the other 6 signers for the overall treasury? A 9/12 multisig req is fairly onerous and we’d need to ensure that the signers are trustworthy, accessible, and reasonably engaged with the project so they have some level of context for any tx requests.

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Certainly the core contributors, advisers, consultants, and citizens who have previously made it to a Kong embassy would be good candidates. Selecting from past consumers of Kong chips could also align buyers with the producers. If we can’t find 9 people we trust out of 225 citizens, I think we have a larger problem.

In the end, the initial Senate is likely to be largely comprised of core contributors, so there’s not really much of a point to separating the multisigs if they both require a 4/6 signature and the signers are mostly the same people.

Ideally the larger multisig should only be required twice a year plus special disbursements requested by the Senate and ratified by citizen vote

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Hey everyone, just dropped a revised proposal based on all of your awesome feedback :point_down: Please direct any additional feedback to the v2. Thanks!