Introduction
Governance is always a hot topic in crypto ecosystems as that is how consensus is reached on how to steer the chain, community, and most importantly the allocation of ecosystem funds. On the Terra chain, governance is structured in such a way that anybody who stakes $LUNA has a say in governance decisions proportional to the amount staked. Usually, governance starts with discussions in community forums - to garner ideas and refinement, followed by an official onchain proposal. Terra governance proposers are required to submit a deposit amount of 512 LUNA alongside the proposal which is returned when the voting period ends unless it is burned with veto.
Method
In this dashboard, we’ll be looking at the recent 5 governance proposals submitted on Terra. Specifically, for every proposal, we’ll be looking into the vote count, vote options, voting momentum, and switching. The analysis in this dashboard will cover the following Proposals:
- Prop 3796
- Prop 3795
- Prop 3794
- Prop 3665
- Prop 3619
Proposals will be analyzed in descending order of submission.
Definitions
On every proposal, voters have four (4) options:
Yes
: To signal in favor.No
: To signal not in favor.NoWithVeto
: To signal not in favor, and the deposit should be burned.Abstain
: Voter abstains. Abstain votes count toward meetingQuorum
.
For proposals to pass, they must meet these three (3) conditions:
Quorum
is met when at least 30% of all staked Luna votes.- The total number of
NoWithVeto
votes is less than 33.4% of the total vote. Threshold
is met: the number ofYes
votes is greater than the number ofno
andNoWithVeto
votes.Abstain
votes are excluded from theThreshold
tally.
If the previous conditions are not met, the proposal is rejected.
Source:
Proposal 3796
In proposal 3796, Eris Protocol asked for a grant of 312,500 LUNA in a revised grant proposal to “provide the Terra community with a product suite for a stable LSD economy, a fair delegation and governance framework, and a Liquid Staking Derivative Liquidity Hub”.
Proposal 3795
In proposal 3795, Terra Poker submitted an updated proposal to request 300,000 LUNA in grants to cover operations and expenses in the prolonged bear market. This is how the community voted.
Voting on Proposal 3796 began on January 13 and ended on January 20, 2023. A total of 304 unique wallets cast 332 votes which means that some switched along the way. The voting activity followed a zig-zag pattern along the way but peak activity was recorded on January 15 with 67 votes.
Out of the 332 total votes cast, 64.7% voted Yes, 23.7% voted No, 10.3% Abstained, and 1.28% voted NoWithVeto. All the votes cast carried a weight of 1, which means that no voter split their votes across different options. At the end of the voting period, the proposal passed.
During the voting period, 25 voters switched, representing 8.22% of the voter population. 23 voters switched votes once, 1 voter switched votes twice, and another voter switched votes 3 times.
Voting on Proposal 3795 began on January 10 and ended on January 17, 2023. A total of 158 unique wallets cast 168 votes which means that some switched along the way. The voting activity followed a zig-zag pattern along the way but peak activity was recorded on January 10 with 62 votes.
Out of the 168 total votes cast, 31.7% voted Yes, 60.2% voted No, 5.59% Abstained, and 2.48% voted NoWithVeto. All the votes cast carried a weight of 1, which means that no voter split their votes across different options. At the end of the voting period, the proposal was rejected.
During the voting period, 10 voters switched, representing 3.29% of the voter population. All 10 switchers switched votes once.
The above chart represents a visual representation of the votes cast in proposal 3795 from the beginning of the voting period to the end. We can see that from the onset, the majority of the voters were in favor but a lot of opposition came in towards the end.
Proposal 3794
In proposal 3794, Terra Poker submitted a proposal to request 300,000 LUNA in grants to cover operations and expenses in the prolonged bear market. This is how the community voted.
Voting on Proposal 3794 began on January 10 and ended on January 17, 2023. A total of 96 unique wallets cast 97 votes which means that one voter switched along the way. The voting activity followed a zig-zag pattern but peak activity was recorded on January 10 with 26 votes.
Out of the 97 total votes cast, 14.4% voted Yes, 68.8% voted No, 15.5% Abstained, and 2.06% voted NoWithVeto. All the votes cast carried a weight of 1, which means that no voter split their votes across different options. At the end of the voting period, the proposal was rejected.
During the voting period, only 1 voter switched, representing 0.329% of the voter population.
The above chart represents a visual representation of the votes cast in proposal 3794 from the beginning of the voting period to the end. We can see that from the onset, the majority of the voters were in opposition and that was the case till the end.
Proposal 3665
In proposal 3665, Contro Protocol submitted a proposal to request 560,000 LUNA in grants to cover operations and development expenses.
Proposal 3619
Proposal 3619 upgrades the Phoenix chain to v2.2.0
Voting on Proposal 3665 began on December 17 and ended on December 24, 2022. A total of 190 unique wallets cast 199 votes which means that some switched along the way. The voting activity followed a zig-zag pattern but peak activity was recorded on December 18 with 36 votes.
Out of the 199 total votes cast, 71% voted Yes, 7.25% voted No, 19.7% Abstained, and 2.07% voted NoWithVeto. All the votes cast carried a weight of 1, which means that no voter split their votes across different options. At the end of the voting period, the proposal passed.
During the voting period, 9 voters switched, representing 2.96% of the voter population. All 9 switchers switched votes once.
The above chart represents a visual representation of the votes cast in proposal 3665 from the beginning of the voting period to the end. We can see that from the onset, the majority of the voters were in favor and that was the case till the end.
Voting on Proposal 3619 began on December 12 and ended on December 19, 2022. A total of 190 unique wallets cast 199 votes which means that some switched along the way. The voting activity followed a zig-zag pattern but peak activity was recorded on December 13 with 94 votes.
Out of the 199 total votes cast, 97.9% voted Yes, 0.42% voted No, 1.28% Abstained, and 0.426% voted NoWithVeto. All the votes cast carried a weight of 1, which means that no voter split their votes across different options. At the end of the voting period, the proposal passed.
During the voting period, 15 voters switched, representing 4.93% of the voter population. 14 voters switched votes once, 1 voter switched votes three times.
The above chart represents a visual representation of the votes cast in proposal 3619 from the beginning of the voting period to the end. We can see that from the onset, the majority of the voters were in favor and that was the case till the end.
Conclusions
In the last five (5) Terra governance proposals submitted for voting, 4 were grant proposals with the other being a protocol upgrade proposal. Out of the 4 grant proposals, 2 passed and 2 got rejected. The passed proposals were by Contro Protocol, and Eris protocol respectively. Terra Poker’s first proposal was rejected, and a subsequent one was also rejected.
In all, it seems the Terra community understands what is best for the ecosystem therefore proposers must apply tact and reasoning and polish their proposals in order to receive a passing quorum.
Comparing Proposals 3796 and 3795 both of which were grants proposals with finished products, it is clear why the community rejected 3795 and passed 3796. While both projects bring direct value to the Terra ecosystem, is slightly innovative with is liquid staking derivative (LSD) offering. Grant funds from Proposal 3796 will be milestone based which means there’s less likelihood of misappropriation of funds compared to a vesting based model.
The above chart represents a visual representation of the votes cast in proposal 3796 from the beginning of the voting period to the end. We can see that from the onset, majority of the voters were in favor and that continued till the end. Yes
votes dominated on each day.