I posted about this on [reddit](link removed as I’m only allowed 2) and twitter, and was encouraged to post about it here too.
I was looking forward to reading the Cardano treasury paper, but I was quite disappointed with it. It references Dash and some theoretical issues with its MasterNode voting, which just happen to be addressed by features Cardano will add: private ballots and delegated voting.
However, the paper demonstrates little familiarity with the history of Dash’s treasury and does not address the most obvious problems it has faced.
The Dash treasury DAO transmits funds to the wallets of successful proposals as soon as the vote has concluded, payment is in advance. This is open to abuse, especially while the DAO cannot enter into binding contracts with proposers.
Decentralizing decision-making about which proposals should be funded is just the first step, if the story ends with “successful proposals receive funding” Cardano will have the same problems that Dash has/had. Decentralizing control of escrow, or ensuring that satisfactory progress is being made to justify continued funding, is important and probably quite difficult to do well.
I have written an article about the history of the Dash treasury DAO. There is plenty that other projects with autonomous funding can learn from Dash’s experience.
There are some other issues with the Cardano treasury paper’s treatment of Dash.
iii) The voting rule and the decision to allow only masternodes to vote in the election makes it “unfairly” diﬃcult for proposals that do not have the support of the founder and core team to succeed because a considerably large amount (about 33%) of masternodes are owned/controlled by the founder and/or core team.
I’m surprised to see a statement like this, about a controversial aspect of a competitor project’s history, appearing in an academic paper with no source/reference.
Amongst other drawbacks, only operators of MasterNodes are allowed to propose projects and vote and about 73% of all funded proposals have been proposed by two members of the DASH community.
It is incorrect to say that only MasterNodes are allowed to propose projects, but that contradicts an earlier statement that “The DGS allows regular users on the Dash network to participate in the development process of the Dash cryptocurrency by allowing them submit project proposals” so looks like a typo.
There are a number of issues with the second statement about 73% of all funded proposals being proposed by two members of the Dash community (I assume this refers to eduffield and babygiraffe).
That statement needs a date, the system is live and the proportion changes all the time (it’s been dwindling rapidly over the last year)
Based on an observation period of August 2015-January 2018, these users submitted 109 proposals which received funding, out of a total 321 funded proposals, so 34%. I’m not going to figure out when 73% was true but I’m guessing it’s a long time ago.
Number of funded proposals means very little, as the amount of funding requested differs markedly between proposals. By my calculations, proposals from eduffield and babygiraffe together have received 64% of the total DASH distributed by the treasury. However, much of this DASH was distributed while the currency had a relatively low value. As the $USD price of DASH has increased, the proportion going to proposals from these two users has decreased. Using a simple method of attaching $USD values to proposals based on their time of submission, proposals from eduffield and babygiraffe have received around 15% of treasury funds.