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

Governance Parameters Committee Updates
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To be fair, “Why? Who benefits? What relationships?” are good questions. Our industry and our community are in the business of looking at incentives, so I would be curious if anyone can provide a compelling argument bad motives explain the actions of the Parameter Committee better than good motives.

But a sober analysis is not the same as simple speculation, as you know of course. I find it quite easy and even darkly enjoyable to imagine malicious powers controlling things, but what exactly is being suggested, and is it the best explanation? Sometimes yes, sometimes no.

Bureaucracy has a tendency to feed itself and grow out of control. I agree. At the same time, some bureaucracy is required in order to make changes stable, rational, and accountable.

As seen in examples from older chains like bitcoin and ethereum, a decentralized system tends to want to stick with what presently works. So, the bottleneck here isn’t the reasonableness of this specific parameter change, it’s the overall trajectory of the blockchain toward decentralized governance.

Like I said, whether this combined endeavor of the PC, signing authorities, and community is legit partly depends on steady feedback loops of progress and communication. I include community because community members both participate in the PC and give the PC inputs like the on-chain vote and feedback in SPO calls and thread such as these.

I think I’ve done all I can for now to explain things given the progress that has been made so far. The next step in this conversation will come when steps #4 & #5 are publicized. When that happens, I’ll be grateful to hear from you guys about the timing and substance of what occurs. It’s small step by small step at this point, but I think in the right direction.

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The parameter committee are simply pawns. An attempt to provide some legitimisation for the ridiculously long delays in changing anything. Sorry, but I am not directing this at you personally @Matthew_Capps1.

The simple facts:

  • minPoolCost creates a barrier for small pools to grow. Any pool with less than 10Million stake is uncompetitive at producing yield for delegators.
  • minPoolCost is compulsory regulation. Pool operators cannot opt out of it. There is no way for an operator to lower this fee levied on their delegators.
  • This benefits OG pool operators who happened to get in early, many of which are multi-pool operators now hurting our decentralisation. Their delegators will lose reward income if they move from one of their large pools to a small pool.
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I hope to convince you otherwise as progress is made. Thanks for engaging earnestly, I appreciate it.

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I appreciate your efforts and wish you good luck.

Despite how my comments may come across, I am personally undaunted by the minPoolCost problems. It won’t change what I do whether minPoolCost is lowered or not. I don’t seek to profit from my stake pool. I run it to force myself to watch what is happening in the ecosystem and look for future development opportunities etc. The lower limit for me is that I need to know everything is working OK, so I want to see 1 block being produced every few days or week.

However, I don’t like to see small pool operators struggling to come up with ways of working around this problem. For example, there are small pool operators that are negotiating privately with large delegators to manually transfer portions of the minPoolCost fee to them after each epoch. And, as I pointed out above, there are now small pool operators taking out Ada loans, at significant cost, in an attempt to overcome the competitive barrier to entry.

I have actually thought about creating a smart contract rebate service to undermine the minPoolCost regulation as follows:

  • Allow every delegator to opt in to a “minPoolCost rebate” smart contract. You wouldn’t need to send any Ada to this contract so there would be nothing at risk for the delegator apart from a tiny transaction fee to opt in.
  • Every epoch the minPoolCost amount is sent from the pool reward account to this “minPoolCost rebate” smart contract. Each time this happens, the smart contract updates it’s state recording the additional rewards owed to each current delegator representing their proportion of the minPoolCost fees.
  • When a delegator chooses to move to another pool they can opt out of the “minPoolCost rebate” smart contract and withdraw their additional rewards owed.
  • The “minPoolCost rebate” smart contract would be delegated to the particular pool thus allowing the rewards held by the smart contract to continue to earn rewards for the pool operator.

I think it is only a matter of time before someone builds such a smart contract. Maybe sites like adapools.org would even prioritise pools that enable such a rebate service by listing their minPoolCost fee as zero.

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45

Hmm, a lot of these “multi-pool OG”s have spoken out for parameter changes and voted for them in the poll, which somehow torpedoes that explanation for why we see happening what is happening.

I don’t think we need ill intent and “cui bono?” muttering for such an explanation if corporate bureaucracy is totally sufficient.

You could get the impression that the higher-ups at the founding entities do not really have a sense for how urgent this topic is for some SPOs and how long they have been struggling. But that is also easy to explain if you just imagine them not reading forum, Twitter, and Discord regularly.

If they just listen in on SPO calls from time to time, it’s easy to honestly keep believing that the more urgent calls are just exaggerations on the fringes and everything is okayish enough to take any time it takes to evolve this.

(… and, honestly, I can’t even tell how the percentages really are, for which share this is how urgent, if the SPOs who started without a clear path to large stakes, but believing it could become sustainable nevertheless and not just a hobby, are dozens, hundreds, or thousands, and if their view even should be relevant.)

It would for sure have been more convincing if the process had been worked out and clearly communicated before the poll and before this parameter committee started working. Seems kind of ad-hoc to now ask for some patience while they try to decide how they even want to proceed. But it seems we can’t really change that after the fact.

Also: It’s a little bit strange that so much(?) effort is put into “getting it right” this time (halting this specific parameter change much longer than the hard forks and parameter changes before which somehow could be done easily if the tribes inside the entities deemed them necessary).

After all, this process will be very much temporary and shall be replaced again by Voltaire very soon. Why then not do it as ad-hoc (and faster) as all the hard forks and parameter changes have been done up to now?

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Maybe, or maybe not. Some of these multi-pool OGs might be sensing the winds of change and are politically astute enough to want to be seen as voting for “decentralisation”.

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Parameters Committee is Kevin’s newest another-6-months stall tactic. Matthew, Jaoquin, and the PC are the newest faces to continue the newest IOG stall. Previous stalling arks were the SPO call surveys, guest talks, and anti CIP-50 blog disinformation out of Aggelos. He was paid a bunch of money to focus on the EDI and STFU ignore Cardano RSS. In a bunch of months new IOG faces and new stall tactics will be created just like they have been for the last 3 years. There will probably be another PC and then a stall-to-VoltaireHF-effort. I’m not doing an RSSv2 research paper and study for the trivial obvious solution of negative RSS slope vs size and pledge leverage limits.

Why? Why does any of this make sense? Why put Voltaire governance last, not first?

  1. Genesis key control of treasury spending.
  2. IOG promises to ICO investors using RSS yield boost.
  3. IOG is controlled by the investors.

WHO KNOWS, NEW GUY, andor NEW GIRL clutching to pledge boost and anti-competitive minPoolCost likely controls IOG. Maybe there is capture and control by Wave andor Coinbase.

This is the seriousness and magnitude Charles faced dealing with Ethereum which resulted in the birth of Cardano. F RSS minPoolCost, genesis keys, and RSSv2. Goodluck Voltaire HF, you are the only hope. Instead of productive governance and community relations preVoltaireHF Cardano will now have a spiritual, moral, values, principles, economic, and technological successor. I literally got so pissed I’m writing a new whitepaper: Egalcoin.

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… that sounds like you are maligning a man’s professional integrity without any evidence, and perhaps even accusing him of accepting a bribe. I don’t think that’s what you’re intending to do. Am I misreading, or can you clarify?

I don’t mean to be combative, but you can understand my annoyance at hearing a colleague treated this way. Maybe I’ve misunderstood?

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I’ll clarify. I mean to be combative. I’m sorry. No more rose glasses.

He knew about the k and a0 parameters, but in interviews said: “Well if a participant is big enough it’s ok if they run multiple pools”. It’s too ethical to expect large stakeholders to delegate stake to dozens to hundreds of decentralized pools. IOG, CF, and Emurgo should have done that from Genesis only operating 1 pool each, obeying their own k parameter, as they expected members of the community to do. The ego of supporting decentralization, but only a controlled decentralization number. Unfortunately, they messed up RSS and it didn’t even achieve that level which is why CIP-50 exists. They missed the principle that you shouldn’t control decentralization in a permissionless ecosystem. However, the stagnant decentralization, control via RSS & genesis keys, and anti-competitive minPoolCost is perfect for investors and early insiders. Aggelos is/was IOG Chief Scientist.

Aggelos knew the minPoolCost was not included in the RSS paper/study but was included on Cardano Mainnet. He knew it promoted multipool operations and did nothing to protect against low-pledge sybil-leverage, yet interviewed on RSS preventing sybil behavior (false). He has partial responsibility for those decisions. He was/is Chief Scientist lead of the research team and responsible for including that parameter to disadvantage small participants.

He did no monte carlo style stochastic simulation of hundreds to thousands of participants over hundreds of epochs for many RSS’s with reserve emission and many potential parameter combinations. He isn’t at that skill level. The RSS paper was basic and needed to be rejected pending a proper analysis (not just theorems). Only after CIP-50 did he ‘discover’ (learned from CIP-50) that MAV is an industry-standard block production decentralization figure of merit, ‘3000’ pools didn’t matter, ‘k=500’ didn’t matter because k-effective was ~40 and MAV was half that ~20. CIP-50 destroyed the vanity metrics. He still won’t acknowledge the difference between k and k-effective. He was/is Chief Scientist lead of the research team.

He has been tasked to and expected to deliver the EDI, and I cannot click on a link in my browser to open a dashboard of the EDI. Charles first talked about it more than a year ago. Balance Analytics is younger and currently far superior for Cardano block production decentralization. I expect EDI to have something like BalanceAnalytics for many blockchains. Wen??

You can praise him for his accomplishments but it is also necessary acknowledge he hasn’t been perfect, has made decisions for the benefit of investors, he has made technical mistakes, and isn’t the most intelligent on all these topics.

You are allowed to be annoyed when I’m highly critical of a colleague you greatly respect, especially when I’m being combative. I would have had more respect for Aggelos if he resigned from IOG a couple years ago when all of this became obvious on mainnet. I would believe there was absolutely no conflict of interest if Aggelos didn’t hold a C-suite position at IOG when IOG donated $4.5M to his university. C’mon, this is basic conflict of interest stuff.

This parameters committee cannot sign with the genesis keys and is just another stall/cope layer. Many people tried the CIP process with CIPs-[7,23,37,50,74,75,82] with no result. So, we are back to:

Why? Why does any of this make sense? Why put Voltaire governance last, not first?

  1. Genesis key control of treasury spending.
  2. IOG promises to ICO investors using RSS yield boost.
  3. IOG is controlled by the investors.
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50

Good! hah. I’m glad we can agree to being combative, hopefully within a layer of mutual respect and even potential friendship.

I’m not in a position to defend Aggelos point by point as I don’t know the history or research as well as you. But I’m glad to know you weren’t trying to imply that Aggelos has taken a bribe to promote disinformation.

As far as minPoolCost and the PC go –

  1. Does your model of IO predict that it won’t play its part in a change of minPoolCost, per the PC’s recommendation, that occurs in the timeframe you mentioned “within 6 months”?

  2. Does your model of the PC predict that it (or an equivalent advisory body continuous with the PC) won’t continue to a) take community requests for deliberations about protocol changes b) involve experts from multiple organizations in these deliberations c) communicate about their membership, reasoning, and processes?

PS - although I’m a relatively new face to parameter discussions (I did host an SPO call where parameters were discussed back in 2021), I’ve considered myself part of the Cardano ecosystem for ~2.75 years and have worked with or at IO for 2.5 years. I’ve been around quite a while and many people in the ecosystem worked or spoken with me.

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51

Since you are so long in Cardano, you must have noticed that this topic has been discussed for years and every argument has been stated a zillion times.

Can you acknowledge that it could sound a little strange to people waiting for changes for such a long time that now it has to be “worked out” and deliberated again?

I’m still kind of in the middle hear: I do assume good faith from most doing voluntary work here, being new at least to roles in PC and things that are happening after the PC recommendation. And I can assume not deliberate ill intent for the benefit of a cabal, but just corporate and/or scientific tardiness from those who have been and are responsible for this topic for all those years and just didn’t do anything, but invented new ideas of how people should kindly work for changes every couple of months (with sometimes a lot of work put into something that was then discarded for the next idea of how changes should work).

So, I would appreciate if you could communicate to whomever it concerns in IOG that there should be a little bit of urgency in putting out a clear and committed plan what happens how when, now. (And it’s unfortunate that @Michael.Liesenfelt threw these 6 months into the discussion. I see absolutely no reason for this first parameter change to take more than a couple of weeks, really.)

It is the absolute smallest compromise possible: Only the parameter that doesn’t force pool operators to act immediately – just allows them to lower their poolCost – is changed and it is only halved not removed completely. This smallest possible first step being executed swiftly is probably absolutely necessary to restore a little faith and patience with many of the long-term participants of these discussions.

And I would appreciate if the independent members of the PC would put a little pressure on it that they won’t continue to put their names on it if it turns out to be a farce – probably another farce in the not totally unfounded view of people who already tried it in SPO calls, in CIPs, in public discussions, ….

Still appreciate you personally taking the time to discuss here!

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I’m just pointing out that there have been many successive parameter stall efforts over many years from IOG which have each lasted about 6-ish months give or take. I’m with Sean that this should have been a 4-6 week effort setting minPoolCost to 0 three years ago with a deeper focus and longer debate on a0 and k.

There was a parameters stall for smart contracts.
Then a parameters stall late 2020 to early 2021 for k=1000
Then a parameters stall using SPO community call polls and process.
Then a parameters stall for the IOG Research Team to do something?
Then a parameters stall claiming the CIP process was needed.
Then a parameters stall on CIP claiming IOG Research Team needed to approve/implement?
Then there was a stall for Vasil.
Then there was a parameters stall for an on-chain nonbinding poll/vote.
Now there is a parameters stall for a new Parameters Committee process after the poll. Aug 23 came and went.
Next there likely will be a stall for Voltaire-HF.

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Fwiw, I should’ve been a bit more careful about how I quoted Michael here :arrow_down:

To your point,

if I thought the Parameter Committee couldn’t fulfill its stated purpose, I wouldn’t take a volunteer position there. But to be quite specific, if either of the predictions I proposed for the hypothesis ‘that the PC is ineffective’ come true, then I’ll resign from my volunteer position. Likewise if some other compelling reason were to present itself.

This is distinct from work that my role at IO might entail, such as my present work coordinating comms between IO and the PC.

Like you say though, I believe we will see a response from IO on this far more quickly. But on the topic of timing I have to point back to what I mentioned earlier. As much as I’m tempted to spin out prefacing details asymptotically or make assurances of good intention, that would just essentially be ‘stalling’ while we wait for the next step.

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Seriously @Matthew_Capps1 : Talk to Charles, talk to whoever has the power in IOG, maybe even talk to Aggelos. This is at the ridiculous level now. People are tired and frustrated and the reasons for delay are being speculated about with negative connotations.

Remember that this minPoolCost parameter:

  • Is not essential to the working of Cardano.
  • Was dreamt up by someone in the beginning and is not in the Ouroboros design.
  • Was assigned a value plucked from thin air.
  • Amounts to anti-competitive regulation benefiting incumbents.

And:

  • The community voted on-chain to halve it months ago.
  • It can be changed very easily by the people with the power to sign.
  • Halving it doesn’t require any SPO to do anything. No software update, no certificate change, not even restart their node software. Nothing!
  • Lowering it would simply allow SPOs to lower their minimum fee if they want to.

Imagine allowing SPOs to set their own fees so that they are able to compete with people that got in earlier than them. Imagine the Cardano protocol not unfairly disadvantaging new SPO entrants irrespective of how much pledge they are prepared to lock up and for how long. Imagine the concept of free and fair competition, equal access to everyone, … You know, those core blockchain principles that Cardano holds so dear.

The reason you get me on here saying these things is because:

This issue is actually hurting Cardano’s reputation. This fiasco will be used as a way to besmirch innocent well meaning people and impugn the core beliefs of Cardano.

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Hello everyone! I totally get most of the “delay”-sentiment and the fact that k-changes or parameter changes at all are hot topics for years. I am convinced we made the mistake in the call notes of 27 July to announce the date as “August 23 is the proposed target date for enactment”. - a perfect template for frustration if this cannot be met. (and it was not met)

Nevertheless, I wanted to assure you all that there is clearly no intentional delay in the above parameter change by anyone or even a “someone is pulling nasty strings in the background”-situation. In fact, we have various observers from the community on the committee (in addition to people from organisations that also came from the community) who can confirm this.

Think it through: Different folks from different organisations coming together, observers, meetings notes, public discussions in the Cardano forum - I guess everyone agrees that this method is so far the best and most transparent way to process requests for parameter changes and to gather feedback in a structured way. Is it perfect? Likely no, but it is not comparable to the situation we had before, where things were held in, I don’t know, a secret room somewhere in the basement of IOG. :grin:

We’re all in this together, and I appreciate everyone’s patience and understanding. I would just like to ask you to keep the conversation constructive and support each other.

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We’ve had forum discussions in the past as mentioned in earlier posts, the net result so far seems to be essentially the same… people are tired of endless stalling (intentional or unintentional) without transparency behind it, singing kumbaya for years is also getting old. What’s the exact hold up as of this moment in time, can we get a clear answer?

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…, but: The current hold-up is not with the committee anymore. And it is – up to now – as intransparent as before.

The committee – which is a bit more transparent and which has people from the community (not elected, but at least respected) on it – has already done its work. It has recommended an incredibly simple change – as said the smallest compromise that one could think of – which could be implemented by just issuing one transaction on Cardano.

That takes an hour, construct the transaction – five minutes – collect the signatures of enough of the founding entities – 50 minutes – submit it – five minutes.
Okay, the founding entities are smart – governance keys are probably at a very safe place – worst-case it takes a week to travel to any place on the world and sign the keys there.
Okay, those are big, slow organisations – probably they need a decision of the board, before anybody moves – what can that take? Two more weeks to wait for the next meeting?

Think it through: That process that is arguably a bit better is already finished. We are at the point where we are told that this transparent, approachable, participatory committee does not have the final say on this. That all the transparent and observable discussions may mean nothing if the powers that be do not agree. And the powers that be are silent for weeks. Again.

You could have written an equally excited post that doing CIPs is the way to change parameters – transparent discussions with the whole community that we have never seen before preserved in written form! We had that months ago and it lead to nothingness.

Since it is stalled at some very intransparent point somewhere inside two to three bureaucracies, the only constructive thing that can be done is: Tell the powers that be that it would be wise to kindly hurry up. It gets a bit ridiculous.

For another batch of people who still managed to give the benefit of the doubt and not find it ridiculous after it was first told to write CIPs and then that those CIPs will never work weeks/months later.

And all we are told is that they – IOG, CF, Emurgo, whatever concrete persons that may be – need some time to figure out “how to do it right” and to prepare some communications. I fail to have the imagination what could take that long there. As said, it’s an incredibly simple first step with an incredibly simple implementation.

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It’s great that CF agree - but I still don’t understand what the next steps are. Do we wait for the other key holders to write forum posts? Why? Then what? I asked many times above what the remaining steps were but there was no mention of waiting for forum posts. Does anyone know what the actual steps are to doing something, or is it being invented as we go?

The CF post concludes with “followed by an evaluation of the effects and further adaptations in Q3/Q4”. Do they mean Q3 2024? There’s not much left of Q3 2023…

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I hope not. That would be ridiculous.

Technically, it’s embarassingly simple:

But I guess, we won’t get any answers before those upcoming “blog posts” announced earlier:

I think, we already have established that 6. and 7. are not needed in this case, 5. is ultra simple, just a change of the value of one parameter, one simple call to cardano-cli, leaves us with 4. which is a big mystery.

Maybe, those “blog posts” will even explain why a simple parameter update that the governance key holders have done dozens of times before now suddenly takes months to carry out. One can dream.

Just hope that the poor guys doing the communication here have the possibility to relay the pressure to the people responsible for this show.

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