Aug 17, 2023 | Voltaire era: Parameter committee intermediate state

[Joaquin]

Hi all,

Here are the notes from the previous meeting, held on August 17th:

The Parameter Committee (interim state) meets on a tri-weekly basis. It discusses all parameters relating to the Cardano protocol including network, technical and economic parameters, providing technical advice and recommendations on updatable parameter settings.

Updated list of the Members (interim state):

Chairs:
Chair: Kevin Hammond
Vice- chair: Alex Moser
Vice- chair: Vijay Bhuvangiri

Advisory Group Heads:
Network group: Neil Davies
Economic group: Samuel Leathers
Technical group: Markus Gufler

Advisory Group Members:
Network group: Karl Knutson, Matthias Sieber, Marcin Szamotulski
Technical group: Ruslan Dudin, Michael Peyton Jones
Economic group: Sergio Sanchez, Philip Lazos, Giovanni Gargiulo

Other:
Communications: Tommy Kammerer, Nathaniel Acton, Addie Girouard, Matthew Capps
Domain experts: Martin Lang, Andrew Westberg
Observers: WIP
Secretary: Joaquín López

Remit

The purpose of the Parameter Committee is to provide technical advice and recommendations relating to the updatable protocol parameters, taking into account economic, security, network and other considerations, as appropriate.

Agenda and Updates:

Agenda:

• Follow up on PCP-001 and Change Request
• Getting ready the blog posts and communications process
• Proposal for governance parameter advisory group
• Publishing PCP template and readiness for public engagement
• Discuss with working groups about current parameter settings

Updates:

• Since a recommendation on PCP-001 has been made, this can now be closed. A Change Request will now be formalized and presented to the signing authorities.
• The Parameter Committee is currently working on several blog posts, including one on the scope and the functions of the Parameter Committee, and one to cover the PCP-001 results, the inputs that were provided by the different working groups, and the data that was analyzed.
• The Parameter Committee discussed a revised process for the meeting notes that will allow communication teams to see them in advance.
• The Parameter Committee expects to organize a fourth advisory group that will be focused on the new governance parameters that will be introduced in CIP-1694. This will be formed ahead of the CIP-1694 rollout.
• The Parameter Committee will define a process that will allow the community at large to prepare new PCP requests, for example via the Cardano Forum.
• In the coming weeks, each of the 3 existing advisory groups will review all of the current parameter settings in preparation for considering community PCP requests.

[DanTup]

• Since a recommendation on PCP-001 has been made, this can now be closed. A Change Request will now be formalized and presented to the signing authorities.

Could you share some more information about exactly what the process is here? In the meeting on July 27th, the minutes stated:

• Based on the recommendation, the Parameter Committee will produce a formal Cardano Change Request to be considered for approval by the signing authorities. Wednesday, August 23 is the proposed target date for enactment.

It’s not clear to me what the difference is between that update and the current one. Was any progress made between 27th July and now?

This topic of minFixedFee has been rolling on for years. Every time SPOs ask for an update, they’re given pretty vague responses like “we’re looking into it”. We have almost zero visibility of what’s going on and just have to trust (that thing we apparently shouldn’t do ) that things are happening.

It would be good to understand exactly what the process is here, what’s left to do, what might delay/hold it up, and when we might actually see the ability to reduce minFees on-chain.

[BTBF_XSP]

I agree 100% with DanTup’s assertion, I don’t know why the discussion hasn’t been more specific even though there are 20 members and the minutes of this meeting are very vague.

[Terminada]

What I am confused about is that the last update said the following:

• The Parameter Committee recommends to retain targetNumberOfStakePools (“k”) at 500, and to reduce minPoolCost to 170 ADA.
• Based on the recommendation, the Parameter Committee will produce a formal Cardano Change Request to be considered for approval by the signing authorities. Wednesday, August 23 is the proposed target date for enactment.

Now in this update there is no mention of any change to the minPoolCost or a date for such change. This makes me believe that the goal posts have been shifted AGAIN by some individuals that have disproportionate control over the protocol compared to the collective community of stake pool operators who clearly voted for change.

We voted on-chain for minPoolCost to reduce to 170, by majority. However, we have not voted anyone in this Parameter Committee. The more this drags on, the more this process seems undemocratic, and I fear this is just tarnishing Cardano’s decentralised reputation now.

The original minPoolCost 340 figure was simply pulled from the air, so halving it to 170 won’t break anything. Why not let the community have what they voted for?

[earncoinpool]

I’m reposting these comments from the July 6th Notes. Hoping to get an answer. Thanks!

Hello, I just wanted to follow up. I was recently told by a member of the Parameter Committee that K=1,000 is still on the table. I’m not sure if this is official communication or official stance of the committee since none of the notes specifically say that K=1,000 will be part of the committee’s future recommendations. If so, can this be added to these notes or the notes for the next meeting?

The notes posted from July 6th say:

" The committee recommended decreasing the minPoolCost parameter to 170 Ada per epoch in line with the results of the SPO poll, and monitoring the effects of changing this parameter. Once the effects on the network and stake pools have been analyzed, further changes to either or both parameters can be considered."

Can you share what will be monitored? What are the metrics being watched? Over what timeline will they be watched or how long must they remain stable? What are the target numbers for these metrics that would trigger the committee to put in a recommendation for K=1,000?

Also, I would like to follow up on this post from July 6th Notes, on a request to add disclosures, which I believe another member of the committee said were in progress, unless I misunderstood them:

Jul 6, 2023 | Voltaire era: Parameter committee intermediate state

I would like to request that the parameter committee please consider adding disclosures and information for the following areas. Thanks for your consideration. How are members selected to join the committee? Who selects members? Does the committee have to vote to add a member? What is the role of the “Chairs”? Are the “Chairs” members that vote on recommendations? What is the role of the “Advisory Group Heads”? Are the “Advisory Group Heads” members that vote on recommendations? What is …

Lastly, I was wondering is replying to the notes here the preferred method of communicating with the Parameters Committee? Or is there a different method? Also is there a main contact from the committee that we should be in contact with?

Thank you!

[jeremyisme]

@Joaquin

A Change Request will now be formalized and presented to the signing authorities.

Can a date for the action and who the actioner is be included?

Is there a further process needed once it has been “presented” to the signing authorities? i.e. is there another committee/meeting that the signing authorities need to undertake to agree to committ to the Change Request?

Thanks

[jeremyisme]

@earncoinpool

Lastly, I was wondering is replying to the notes here the preferred method of communicating with the Parameters Committee? Or is there a different method? Also is there a main contact from the committee that we should be in contact with?

Yes, good question ECP.

[ALoop]

Good questions. I would love to see if anyone can answer those Thanks ECP

[Matthew_Capps1]

@DanTup

Could you share some more information about exactly what the process is here? In the meeting on July 27th, the minutes stated:

The blog posts mentioned in this update are aimed at making the process more clear.

@Joaquin

Getting ready the blog posts and communications process

The target Aug 23rd date probably shouldn’t have been communicated because it was simply an internal suggestion, not a public intention. So, take that as a sign of too much transparency rather than too little!

And on that topic, the biggest issue that delays or hold things up is just that this is a volunteer committee outside the structure of any pre-existing organization, which has to iron out its own workflows from scratch, meets once every three weeks (apart from the ‘homework’ given to specific advisory groups), and expects only a few hours of its members’ time.

To the substance of your questions about process, I will try to get those answered in the forthcoming blogposts.

I am, by the way, a relatively new comms volunteer for the PC, but I speak here in a personal capacity. So I’m not making official Committee statements. Just providing some further clarity and presence informally where I can.

[Matthew_Capps1]

@Terminada

This makes me believe that the goal posts have been shifted AGAIN by some individuals that have disproportionate control over the protocol compared to the collective community of stake pool operators who clearly voted for change.

@Terminada, the Parameter Committee is a volunteer group that makes recommendations. It doesn’t have any decision-making power.

See my reply to DanTup about the absence of speculation about dates in this update.

@Joaquin

Since a recommendation on PCP-001 has been made, this can now be closed. A Change Request will now be formalized and presented to the signing authorities.

When the signing authorities (IO, CF, Emurgo) make their own decision about the formalized change request that the Parameter Committee presents, I think you will hear about it from them or a representative on their behalf, as they will need the SPO community to agree to corresponding node release as per usual.

Let me know if this doesn’t make sense. Again, I’m writing here in a personal capacity and perhaps I’ve missed something.

[Terminada]

@Matthew_Capps1

the Parameter Committee is a volunteer group that makes recommendations. It doesn’t have any decision-making power.

The committee has the power to influence the narrative, to represent the will of the community, to influence how things like the on-chain vote is interpreted.

In a nutshell, minPoolCost:

• is not required by the Ouroboros protocol
• is supposedly based on an estimate of real world costs
• was plucked from the air at a time when Ada was trading around one sixth to one tenth of the current price

And it is clear that this minPoolCost creates a form of anti-competitive regulation which benefits incumbent pool operators by making it hard for new small pool operators to grow their stake.

I don’t wish to come across as nasty and I do appreciate the efforts of the Parameter Committee members. But, I sense that the community of small stake pool operators are frustrated, and frankly just tired, that this process is taking so long when there doesn’t seem to be any reason for further delays.

[Matthew_Capps1]

@Terminada

The committee has the power to influence the narrative, to represent the will of the community, to influence how things like the on-chain vote is interpreted.

I agree to some extent. Obviously if the Parameter Committee represents the will of the community, it’s informal and depends on how the community receives the PC’s reasoning, and how the PC responds to that in a developmental dialogue over time.

About the specifics, I don’t know enough to have an opinion myself and the PC’s combined views won’t be expressed through me. I’m curious though if people with your position have put together a comprehensive argument in something like an informal white paper. Would be useful to have something to address line-by-line so to speak. Not saying this should be a benchmark for a position to be considered.

@Terminada

I don’t wish to come across as nasty and I do appreciate the efforts of the Parameter Committee members.

I don’t think you’re being nasty! To your point about things seeming clear to you-- the PC isn’t working in the deliberative environment of an individual, but rather the deliberative environment of an ecosystem, which is large, diverse, complex, and sometimes quite murky. @BTBF_XSP mentioned earlier the number of PC members as a reason why things should be easier, but this certainly isn’t true on all dimensions!

There definitely are ways for the committee to improve, and some of those are mentioned in the update: in this case putting out documentation of its recommendations, structure, and development (in the blog posts mentioned), and setting up a cleaner comms process. But please feel free to suggest more ways. If they’re put constructively there’s a better chance the committee can understand and integrate them

[Matthew_Capps1]

Noted. Thanks for the request.

As mentioned in the update, there will in future be a way for community members to make requests for the committee to observe, analyze, and provide deliberative recommendations about different network issues.

Eventually what you write here may be able to fit into such a request, and I know it’s already in mind for PC members at least informally. But for now I’ll raise it as a note at the next PC meeting so it gets logged and we can revisit when ready.

[Terminada]

@Matthew_Capps1

I’m curious though if people with your position have put together a comprehensive argument in something like an informal white paper.

There is this CIP:

• CIP-0050? by @Michael.Liesenfelt, which fairly well articulates the problems caused by the minPoolCost amongst other things.

There has also been innumerable discussions on this forum including this one by @Colin_Edwards who was working for IOG as a “quant”.

• Minimum Pool Fees (with a brief mention of K changes)

There is also this awesome analysis paper by @MahmoudNimer (adalink.io) which analyses the effect of the reward sharing formula construction: https://github.com/cardano-foundation/CIPs/files/9389814/Stakepool.Pledge.Influence.in.Stake.Rewards.Distribution.pdf

That analysis paper is quite interesting because it really breaks the formula down and leaves you wondering why the reward sharing formula was constructed as it is today.

But with all that said, I still can’t get past the fact that the 340 Ada number was simply plucked from the air at a time when the USD price of Ada was much lower, and now the community has voted to halve it.

[Matthew_Capps1]

Thanks for the references.

[DanTup]

Honestly, I’m more confused now than I was before.

I’m trying to understand what are the steps to having minPoolCost changed. It sounds like the committee has already agreed this (from the notes above), but it’s still not clear what the steps are to action this.

This thing has been dragging on for years, and we’re never given any clear answers. If the committee has already decided this, what happens next? Does the committee need to do something (it seems silly to have a committee of volunteers who meet only ever 3 weeks and have no power to be driving this is that’s the case)? Who else needs to approve it? Once approved, what is the plan/timeframe for applying it? When they are ready, will we be told that the pools need 2yrs notice so it can be delayed further?

I feel like this is just going to keep being kicked down the road, and there isn’t enough transparency for us to really know whether that’s happening or not. All we ever get is “we’re working on it” and nobody ever outlines the steps and the current progress for us to follow.

I almost shut my pool down over 18 months ago because of this very thing. I was convinced to keep it because there were responses that sounded like maybe things would finally change. Fast forwards 18 months and the only thing I can see that has happened is an SPO poll (which IMO had questionable options), but still no obvious progress.

I don’t know why I keep falling for this. I don’t think it’s ever going to be viable to start as a small pool, and I think it might be less frustrating to just throw the towel in.

[Michael.Liesenfelt]

When I assumed IOG was operating in good faith but the ‘experts’ made big mistakes I wrote CIP-50. It became abundantly clear that genesis keys are the problem, and have always been the problem. Cardano exists because Ethereum F’ed around. Now Egalcoin whitepaper exists because there is no CIP-undo for the abuse of the genesis key powers, RSS, and ICO.

The principles and values of the cypherpunk cryptocurrency movement are building a new home.

[Matthew_Capps1]

To your question @DanTup

@DanTup

m trying to understand what are the steps to having minPoolCost changed.

The next step is that a change request has to be formalized and presented to the signing authorities. From Joaquin’s update:

@Joaquin

A Change Request will now be formalized and presented to the signing authorities.

But to try and clarify the wider progression, here’s my personal (imperfect) understanding:

1. SPO Community: requests a recommendation about some network parameter issue
2. Parameter Committee: observes the issue, analyzes its findings, deliberates about a recommendation,
3. Parameter Committee: communicates what it has observed, analyzed, and deliberated: ending in a recommendation.
4. Signing authorities: accept the recommendations or don’t and begin dialogue about what needs to change from their perspective.
5. Signing authorities: formalize the recommendation in a “change request” which can be implemented in the node.
6. Signing authorities: prepare a node release
7. SPO Community: accepts the node release, or doesn’t accept it and starts a discussion about what needs to change

My understanding is that we are at #4 right now, with the current recommendation about minPoolCost, in the overall progression.

The committee has mostly done #3 through SPO calls, with a little bit coming through in the updates as well. But we can do better. That’s partly what the blog post and redefined comms process are addressing.

Some blog posts that officially outline the whole process will be coming soon. They would’ve been out sooner, but there was a transition in the volunteer comms / pm side of things which caused them to be delayed.

Again, I’m just speaking for myself here, not making an official statement on behalf of the committee.

[Joaquin]

Hello everyone, I just wanted to let you know that we really appreciate all of your comments, they are very helpful to us as we continue to improve our processes. Please note that this committee has been created very recently and we are still defining most of these processes, so it is going to take us some time to stabilize it. But I am sure we are going in the right direction, bringing you more transparency and engagement. I hope you agree and that you will continue to use this communication channel to stay in touch with us.

[Matthew_Capps1]

Hey @Michael.Liesenfelt, I appreciate that you’ve added a lot to the conversation with CIP-50. But tangentially promoting another protocol here isn’t constructive (at least it doesn’t seem so to me).

Do you have a critique of the prospects for Cardano governance somewhere, along the lines you mention, that has an angle on this discussion about the parameter committee? That might be relevant and indeed helpful!

I apologize for not being fully caught up with your work on this, appreciate your help.