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Ungovernable Podcast Ep. 11 – Doo Wan Nam
Recorded: March 27, 2025 Duration: 1:06:17Space Recording
Short Summary
In a recent episode of the Ungovernable podcast, Du Wan-Nam, co-founder of Stable Lab, discussed the evolving landscape of decentralized governance, highlighting trends in stablecoin adoption, the significance of community engagement, and the potential impact of Unichain on the DeFi ecosystem. The conversation underscored the importance of professional governance participation and the strategic partnerships shaping the future of decentralized finance.
Full Transcription
Thank you. Music Thank you. Thank you. Thank you. Music Thank you. Join the ungovernables.
No filters, no apologies.
This season we're cracking open Uniswap governance. Welcome to a new episode of the ungovernable podcast. Today, we've got Du Wan-Nam, a co-founder of Stable Lab.
They're at the forefront of DAO governance,
designing systems and voting frameworks
across protocols like Maker,
Aave, Optimism, and of course, Uniswap.
We are Joe and Austin from Alpha Growth,
your premier DeFi ops and growth firm.
Du, thank you for being here.
What else should everybody know about you?
Well, thank you so much for inviting.
And yes, so my name is Du.
I'm a co-founder of CIO Stable Lab,
which is involved in more than 25,000.
I personally have been involved a lot
for compound as well as Minoswap.
And then also been contributing
to Sky Ecosystem since 2018. many say that i've been there for a
while maybe also means that i just haven't retired but other way it's been a quite fun journey and i
think that also really contribute to how i as well as the team think about governance as well
so happy to be here absolutely yeah and uh would love to start out with just a little bit of your personal journey. You were in the military and now you're in something that could not be further away from the military in terms of decentralized versus bureaucratic and centralized. So I'd love to hear from you how that all happened.
from you how that all happened yeah so uh so even actually before military my background is in
economics and also international affairs so i actually been working a lot on the fixed
currency so for example like argentina as well as like looking at asian financial prices and others
so when i finished my military service as an officer. I was looking at this entity and then it was saying that they're looking for an asset that doesn't change value.
And then I was like, okay, this seems a bit strange.
And so I went to the interview and then there's this person who I think he was probably a bit high on something maybe and then he was talking about how
there's this person called Vitalik who might be an alien but he is a genius and then how this
something called crypto is going to change the world now I'm thinking to myself that this person
is quite crazy but I have recognized that I myself
am also a bit crazy, so this might be a good opportunity. So when I went there, he was
mentioning that they have this thing called ETH, like Ethereum, and that he's thinking about having
some kind of asset that's stable that's backed by it. And I told him that it is technically possible. So I started working on it.
And then later I heard about this project called Maker.
And then of course, I, you know, so they asked me like, okay, there's this project called the Maker.
Like, I think you should do some research regarding it.
So of course, like I came back and said, oh, like their ideas are a bit similar, but at the same time, we are better because our team had me.
Fast forward, the company went bankrupt.
But with that knowledge, I was able to write different blogs and also studies regarding stablecoin as was Maker,
which of course eventually was the aspect that I ended up joining Maker
DAO in around 2018. And then I started with helping with the Korean and Asian community,
and then went to help with business development. Now till then, I was not really interested in
the governance aspect. Like I heard, for example, what happened on the DAO aspect, but as I was kind of looking
from the foundation perspective, as you can imagine that what I thought what DAO does
is that whatever that happens, there are people on the forum commenting some things, right?
But of course, that completely changed when the foundation, when Maker Foundation dissolved
a few years later, and then I start to contribute as a
delegate myself. So then I saw that actually looking from the DAO perspective is very different
from how you might look it from the inside the, let's say, foundation. So then we realized, okay,
what are some of like, because I was both seen as a foundation, as well as as, you know, as a DAO,
like, what would be some of the aspects that are really beneficial for both ecosystems, right?
From both sides.
So that has been kind of the journey.
And that's also how StableApp has become this cornerstone for professional,
not just for delegate, but for the governance services and participation.
If there was one stablecoin through all the years that you've seen,
maybe it took off, maybe it didn't,
and you could just snap your fingers and have this stablecoin be ubiquitous throughout the ecosystem, which one would it be?
Oh, you mean like that stablecoin to be very, very successful?
Yeah, if you could just pick one.
What's your favorite?
What's the one that you've seen
that you appreciate
or appreciate the design of the most
or just feel like it's...
I mean, of course, I'm very biased.
And then it's possible
that some of the members
might be in the call as well here.
So, of course, I wish the USDS
to be like the one.
But I think the kind of series
looking into it,
it was like throughout the journey, there were a lot kind of serious looking into it, it was like, throughout the
journey, there were a lot of stable coins that were pitched, right? And that are so like, launched,
and that also failed or succeeded. But I do think that there were a lot of good lessons learned. I
mean, if you look at, for example, let's say, USDS, or previous DAI as well, there were actually a
lot of lessons that were learned, right? Whether, for example, how to make it more stable,
how to make it more scalable.
But in terms of your question about what stablecoin,
would I make it successful?
I must say that in the US, yes.
But you can ask another question,
which was what I thought was the most interesting stablecoin, of course.
Yeah, let's ask that one. What was that?
So I think there were actually two that were very interesting but one was Amplefort which was actually not real stablecoin but at the same
time was actually quite interesting concept if you think about it because especially back then
rebasing was something that was more in experiment territory and then basically i mean eventually it was kind of shown that
mp4 itself is not so stable per se but at the same time was one of those truly argo stable coin
that was just purely by supply and demand right so of course it is very like speculative so it
doesn't really also fit the criteria for a large stablecoin. But at the same time, it was something that I have realized that it could actually work in terms of the concept.
And then, I mean, it is scale quite a lot.
Of course, like nowadays, people don't talk about it, but that was quite interesting.
Another one, of course, is the Terra.
And then it was actually kind of interesting journey uh for context i'm from korea
right so i heard about tara even before they kind of launched and then as well as the founders and
as well some of the journeys as well as some of their difficulties and then i remember that i was
in d5 community in kore, as well as hearing their struggle.
And then one of the aspects that Do Kwon was communicating to his community was that
beside the stablecoin setup and others, it's also the community and narrative that's very important.
And then he was saying that they were not getting the narrative because when a lot of members, they look at, for example, Korean projects, they don't really think it like, you know, high class, let's say U.S. based projects that have like very, you know, famous founders that are engaged in a lot of social media.
the korean-based founders they were not so active in this kind of community and docon he really
wanted to be active and he really wanted to be like for him was like even if he creates
controversy he felt that there was needed to basically make it interesting and make it
basically gain that traction um like from the setup side there were a lot of i think criticism
and also questions i remember i myself also got a lot of like questions think, criticism and also questions. I remember I myself also got a lot of questions regarding it
and gave my feedback.
And I think that from their side,
they generally had the kind of idea
that maybe they can try to make it successful
by being scalable.
And I think there was a time that I think from the industry,
I mean, because they were able to grow several billions, I think there were some thinking that like, OK, maybe they have reached their status.
Right. And I think that that was kind of the same for a lot of the comments from the crypto Twitter that like in theory, they have those, let's say, aspects that might make them unstable.
But because they have grown so much that maybe now they kind of wish they could
bring them of course the history tells that that was not the case but it was definitely a very
interesting aspect not just because of the setup but also the how they at least thought stable
coin not just as stable point itself but as a community so that was also very eye-opening and
of course there were also a lot of both personal friends who were impacted by the fall because there were some that, for example, either invested or they had anchor in those aspects.
So that was also something that was very interesting.
I appreciate you diving in there.
The stablecoin concept is it's pretty unsexy, but I think it's so necessary.
So it's good to have uh when
especially like you mentioned the the controversy is is healthy for innovation because it invites
engagement and i think we need to we need a lot more than that yeah i mean i think that that's
actually a really interesting point like from the stablecoin perspective is that i know that
everybody likes to talk about the new narrative right right? Like, like, for example,
a few months ago, a lot of people were actually
even before that, people are talking about AI a lot, right?
They were like, okay, here's like AI plus the thing.
And they're like crypto Twitter plus the AI.
And then later they're like, okay, meme coins, you know, the narrative
will just changes.
And then and then now the kind of main coin kind of died that
you know died down a bit and then now the people are looking into more d5 aspects they call it d5
3.0 you know at this point uh it's a bit like a windows i don't know whether it's like a d5 x or
d5 like 3.0 or 4.0 it keeps changing but the point being that there's like a lot of new DeFi aspect
that people are talking, as well as stablecoin, right? Like I think that stablecoin at the end of
the day is still being one of the major use case. In fact, like not just within, let's say crypto
cycle, it is true that whether people use it as, let's say, payment or others, there are actually quite a
lot of people who, for example, use not just USDS, but like USDC and also USDT across different
world, right? So I know that we like to talk about like, what's the killer use case. But if
you look around it, like stablecoin is one of those killer use case that's already been widely used.
And then if you ask them, both the partners and others, like why they use them, it's very clear because it's much more transparent.
It's also faster and it's also cheaper, right?
Like especially in some of the banks or countries that are very strict about it.
Like it's one of the aspects that has been very very appealing for them yeah it's definitely the backbone or one of the backbones of d5 so do
i'm kind of curious what you're most excited about for you know the d5 3.0 d5 4.0 what are
your what kind of narratives are you most cited about for for defy coming up yep so and i think that that's
also tied to unisub as well so which is a nice transition there we go right um so like so a lot
of like like a lot of the d5 aspects uh of course evolved over the years and some of them are more
gradual but at the same time what hasn't been tested too much, at least within the, especially
default on Ethereum, has been how much would be able to be like an app chain that's able
to be very successful, right?
So meaning that, like, for example, for Sky, like, let's say, like, you know, previously
Maker, although there were some discussions about maker chain per se like
right now it's still based on ethereum like ave for example like is still like sure it's multi-chain
but you don't really for example hear about other change stuff right or like for example
let's say in terms of um like compound like i know that there was a discussion about compound
chain long time ago but right now at least like Compound has been more focused on the margin aspects.
And I know that you guys probably know it better as well.
So a lot of times like DeFi still has been very dependent on either Ethereum or on other chain aspects.
Now, I think Inuslo is one of those cases where they're actually creating their own L2.
So we actually get to see how much they can grow, right?
Basically being the DeFi protocol
with a good reputation and good brand,
and also a lot of users, and then having the L2.
Now, I do understand that right now,
the TBL aspect itself is still in the process growing,
like it's not as high as others,
but I think that especially once, let's say, those settles and then we have more time it'll be very interesting way to look at it
because i do think that it tests some of the theories that people have been having right
about like how much of the growth they're able to transition into their own chains and then also how
much autonomy they can also have so yeah that's i I think, one of the key changes in DeFi that I've
been interested in. Another aspect that, of course, has been interesting DeFi is, so I know that there
are a lot of different members in the ecosystem. They like to talk about some of the new fancy,
complex theories. You know, they might say, here's the option on top of options to on top of options.
It's like a turtle's all the way down there. It's cool. But at the same time, we have also realized
that a lot of times the problem with people accessing DeFi is not necessarily that they
don't have this complex mechanism, but rather that they don't really have a good way to access it.
So some of the cool innovations I've been also seeing is, of course, about
like, how can people easily use it? In fact, so easy that they don't even realize it's
a blockchain. You know, that's actually the one of the key aspects, right? So some of
some of them have been integrated directly into centralized aspects. So like, even for
example, let's say Coinbase wallet or Coinbase itself.
Coinbase itself technically, of course, is not DeFi percent, but at the same time, if the users are able to interact directly with it,
that's something that solves a lot of issues, right? Because Coinbase itself has a lot of users.
So if the users are able to interact DeFi directly, that itself is something that's very beneficial.
And there's also a lot of improvement in, for example is something that's very beneficial.
And there's also a lot of improvement in, for example, wallets and also access.
I know that they, you know, like the crypto trader like to say, like chain abstraction, others.
But I think, you know, at the end of the day is more about like, OK, what are some of the ways to really increase access?
And I think that's something that has been very exciting because once again, the issue defy is not necessarily the complex mechanism it's more that how can people access it
right yeah we're starting to see the merge you know between defy and cefi um i know we're going
to touch a lot on uniswap but just want to ask one question real quick is why do you think um
unichain is going to be such a game changer?
So I think that it's going to be game changer in both ways,
like meaning that, of course, it's a game changer in a way
that it's, I think, one of, like, because technically
there have been some others that are app chains, right?
Like, for example, DYDX used to be on Stockton,
and then they moved to their own chain on Cosmos.
So technically, there have been some examples,
but even in, for example, case of DYDX was more that,
it was still based on L2 for,
or at least like this Stucknet for a long time
before going into their chain, right?
So I think the Unichain is one of those examples
that can really show to DeFi protocols
what it could mean for, to be like on AppChain.
So I think that it can potentially show that like, hey, like let's say that, you know, like here's an example.
Let's say that UniSwap or Unichain become very, very successful and it's also able to capture a lot of the fees.
They're also able to have a lot of autonomy.
also able to have a lot of autonomy, that could actually also spark other DeFi protocols
and even beyond DeFi protocols to really pursue their own L2 strategy.
Because it's a bit similar to how Coinbase-related base was able to showcase to exchanges that
having their own L2 can be very, let's say, game changer.
So it'll be a bit similar um category
like that now on to just uniswap itself also will be game changer because unisol of course has been
been one of the most popular d app or so people recognize it um also i think the pink unicorn is still a very good idea.
So it's in a way one of those DApps that people are very recognizable even outside crypto.
So if, for example, they're able to grow market size via this, that's already very popular.
I think that it also signals to others about some of the ways to basically utilize as a growth hack, right? Because then they will also recognize, okay, not just from,
let's say, this chain perspective, also from user perspective, it also can, because once
again, what's one of the struggles for DeFi protocols? DeFi protocols, like, usually not
too many people use it. It's like per person, they do use quite a lot.
But in terms of the users itself, it's still limited.
So if this is a way for protocols to be able to get more users and also have more visibility,
then that's also something that's going to have a lot of impacts.
What do you think is the threshold for individual apps such as Uniswap and Compound and Aave?
What do you think is the threshold in which it would make sense for them to launch their own
chain? It sounds like you're relatively bullish on the concept of Unichain and you think there's a
there's a lot of there's fee capture, there's expanding the expanding their reach. What other
types of protocols do you think are going to follow suit?
I think that a lot of protocols are definitely watching what's going to happen with Unichain.
And I think the Uniswap community, so not just Uniswap Foundation, but I think the Uniswap
DAO and many others are also kind of thinking the similar thing, right?
Because I mean, you can imagine that like if, for example, Coinbase launch base, and let's say that it was actually not as successful.
Then I think they eat like, of course, we're looking at what if that kind of situation, but I think it definitely would have like, I think they would like change a lot of the perspective we have, right?
Because even now, when we talk with some of the, let's say other L2s for other reasons or for business related, like they're always a habit as example, right?
So I think in terms of threshold, I think it would be, of course, depends.
But I think that what, I mean, ideally what Uniswap will be able to show through Unichain would be that A, they're able to basically capture quite sizable TBL, right?
And then not only that, what's important would be
it's even more competitive or as competitive as the mainnet.
So I think that's kind of the important point, right?
Because, for example, if Uniswap, let's say on Unichain,
is able to be more competitive than other chains that it's on, at least.
Now, ideally, even more than Ethereum, but let's say at least like more competitive than some of the other chains that it's already on.
That itself is actually a quite huge revelation, because that also means that like, for example,
of course, I don't speak for Aave themselves.
I'm sure that like one day, maybe you can invite Mark or Stani to speak or maybe they already spoke.
But you can imagine that for them will be also quite an opportunity because that also means that they're able to, for example,
understand that having their own might be also like have more users and also more competitive and have more autonomy to it.
Now, I do want to give a caveat that this is
actually not going to be easy, because for all the successful chains, we know there are actually a
lot of unsuccessful cases, right? In fact, there are actually a lot of unsuccessful cases that we
don't hear about or kind of fade away from the memory. for those who might remember like even even for let's say
exchange related uh chain when finance was able to make it successful with the bnb chain
all the different exchanges they launched their own like chain like a smart chain but
only few of them were able to be successful um so i think that it's kind of important to be like
of course like we have high hopes for it.
And of course, we also expect them to hopefully do well.
But if it does well, I think it's definitely going to have a big impact.
If they don't do well for whatever region, I do think that it's going to
probably have another reminder that say, you know, like L2 growth is very
difficult and also AppChain L2 has its limits.
So I think we'll have to see.
So you spoke quite a bit on the tech side and what you're excited about from a technical stablecoin,
even you touched on the Uniswap, Unichain side.
How do you envision down governance evolving over the next few years?
So overall, I do think there it's going to be much more...
So the caveat is that this is not bad or good, especially considering recent changes
from the legal aspects, is that foundations are definitely going to be more active.
And we're already seeing this across different DAOs.
For example, for Arbitrum, already from the DAO side,
they've been cutting some of the fundings,
as well as trying to reduce some of the scopes.
And then, once again, this is neither good or bad.
And I think that it also means that there are definitely some pros and cons, right?
So for a lot of different DAOs, the reason why they also give the responsibility as well
as some of the mandate and scope to DAO participants is also the aspect of resiliency, meaning
that they want to ensure that it's more decentralized and also ensure that, for example, those scopes
can be taken over by some of the
DAO participants. But generally, that comes with being inefficient. Because as you can imagine,
ideally, the most efficient way is to have this more like top down approach, or like at least have
a common communication, right? Like usually, that's more efficient methods. But basically,
the DAO approach is that even if it's a bit less efficient, you're able
to execute it based on the fact that this is more decentralized. Now, and then decentralized
can work in both like, you know, of course, there are some that like the pathos of decentralization,
but there's also some of them like this, whether that's legal or other aspects. Now, the legal aspect definitely has been a bit less issue as time goes, at least for now, based on what a lot of the members are thinking,
like from both like different participants.
Now, it might be possible that they might change, but at least for now, like especially the U.S. landscape has changed quite a lot.
So that also means that now the foundations will feel more comfortable taking a bigger role.
So that we're definitely going to see that. Now, then what does it mean?
Real quick, if I can, if I can double click on that, when you say the foundations are
going to take a greater role, do you envision that as more of a centralizing responsibility
and accountability? Yes. So how I can imagine, and also it's already happening, is that you can imagine that for now
it was more or less a foundation has their mandate and scope and some of the other aspects were
let's say almost outsourced to DAO, right? So let's say DAO contributors, DAO working groups
were working on it. What's likely to happen in the future is that those DAO contributors and working groups will work as a mandate or scope that's given from the foundation.
So, like, this current structure is more like there's a DAO and DAO gives the mandate and scope to the foundation and also gives the mandate and scope to the DAO participants.
So for example, let's say Uniswap is more like, hey, there's a DAO, like Uniswap DAO, there's Uniswap Treasury. From here, they have created the Uniswap foundation and then gave them
a scope and mandate, as well as they gave, for example, scope and mandate for, for example,
Uniswap Contributory Committee and others. So this is kind of a structure where, hey, the mandate and scope has been given from the DAO.
But what could happen in the future is that
basically a foundation has more role in scope than instead of, let's say, these working groups being under the DAO,
instead they're being under the foundation.
So you can imagine that, let's say, the foundation says, I mean, so for this one, I'm not going to say for UN DAO, instead they're being under the foundation. So you can imagine that, let's say the foundation says, I mean, so for this one,
I'm not going to say for like Uniswap, but this is more for like in theory, right?
So you can imagine that in theory, let's say the foundation, they say, okay, now
all the governance aspects will be under their mandates.
And then they say, okay, and within the governance, we want to, for example, have a working group that will be funding that, for example, wants to communicate with the token holders, for example, right? Governors.
And then they say, okay, and within the governance, we want to, for example,
So in the end, the work is a bit similar because at the end of the day, like, for example, this working group, what do, will be similar to what, for example, happens in DAO.
But you can imagine this.
The big change will be then, well, who gets to decide, for example, this kind of initiative is worth it.
And it's kind of likely that this kind of initiative will be more likely to be led by foundation rather than from the DAO governments.
Do you think we'll start to go more into like a hierarchical structure in
that way um i think yes and then i think that's already happening and that's like both i think
that there's also kind of natural course as it happens as well because i think that what happened
was um there of course different type of dows right like and also some might argue that what happened was there of course different type of DAOs right like and also some might
argue that what is really DAO and technically we can have like five beers to talk about
the definition as well as talk about German philosophers but at the same time like what's
I think important is that because we are also in an environment where there were a lot of
experiments that happen with DAOs and then what kind of happened environment where there were a lot of experiments that happened with DAOs.
And then what kind of happened was that there were definitely some issues that kind of arose.
And then one of the big issue was that DAO itself is very close to being a public good.
Now, being a public good, as you know, has both good and bad, but it's also bad because unless they're like strong incentive to discourage it, there will be members that are trying to exploit the public good, right?
Because that means that they're creating, you know, basically it has a positive externality that nobody's really paying for.
that nobody's really paying for.
And then really the way to prevent that is either have a very strong rule of law
and then also come understanding or have basically an organization that stops it.
And basically what happened across Dao these days and also what I heard from a lot of members
or others is that they believe that because for Dao, let's say, they allow it to just run by the DAO itself,
that the mechanism to trying to prevent, let's say, this export of public good hasn't really happened too well.
So that kind of also led many to be like, okay, either DAO basically sets up this, you know, kind of guardrail
to make it at least like watch what happens and also be careful.
Or the foundation decides to take a more heavier role and be like, okay, we gave, for example, funding for this and then let the community decide.
We came with the result that it was not as effective. Therefore, we'll be managing it from now.
And I think this is actually kind of true if you look at a lot of the, I mean, I'm not going to name a specific one, because I owe them dinner, or they owe me dinner, not just
kidding. But you know, but you can imagine that all our L2, like, for example, incentive these
days, some of them used to be, for example, run by the community, and then now it's run by the
foundation. And once again, that's not, you know, either good or bad. It just means that
that kind of nature of it, right, they realized that, okay, that governance is good at making
certain decisions. But when it comes to, for example, aspects that are more related to public
good, maybe they're not so good at making decisions for it, right. So they decided, okay, this kind of
scope and mandate, instead of giving it to the whole governments, they decide to do it under themselves.
Do you remember hearing this quote about, I believe it was
I think it might have been
Benjamin Franklin or FDR or something that
said this, but sorry if
they're listening and I'm going to
misquote one of them, but
the quote has to do with
the impermanence
of democracy and how no democratic system can exist ad infinitum because eventually everybody that's a part of the community and all the delegates basically will vote themselves largesse of the treasury.
And then the democracy will fall and then a tyrant will take over.
What is the failsafe that daos need to put into place
is it the foundation is that the checks and balances and the separation of church and state
or however you want to refer to is that kind of what you're alluding to here so um i do think that
what happens is that um so i thought a lot about it and at the end of the day, this is more about the balance of power.
But I think that a lot of times what a lot of people maybe misunderstand is that balance of power can be achieved.
I mean, a lot of times I think that, you know, this is more international affairs of course relations.
It's like people like to say, OK, balance of power means, for example, if there's a strong player A, then there's a strong player B or collision, and then they balance each other.
That is one way to solve it.
But actually, if you think about it, or if you study about it, another actually way to solve it is basically there's a superpower or like basically there's a super majority or like decision maker who can keep the peace.
Right. And then ironically, that's also how some of the aspects are solved.
And I know that, of course, when people mention like balance of power, it kind of means like having this delicate in the both parties,
basically doing check and balances. But it is also true that in reality, this power is also kept by single autonomous, let's say, and, and
also strong, it can be a group, it can be a coalition that's
leading it, right. And then that itself is not necessarily bad.
But at the same time, then you can ask like, okay, well,
doesn't that for example, mean tyranny? And not necessarily per se, right?
Because once again, like, let's say, for example, US,
I'm not going to go into politics too much.
Also, I'm Korean, so I cannot vote anyway, so it doesn't matter.
But if you think about it, US in a way is a single power, right?
Like, for example, if there's a problem in others,
there's, let's say, central government.
Of course, there are states, but at the same time,
it is still United States, right? Like, technically, it can be divided into, let's say, different
countries within United States to like check and balances. But no, it's like the United States,
and there's a law and there's Supreme Court and others, right. And then what I'm trying to say
is like, well, that example doesn't really make sense. Well, my point would be, well, technically,
it's a one group called the United States, but within it, there's a Congress, and Congress is composed
of many different members, and they do check and balances within, right? So it's a bit like
that, where like, you can have a very strong aspect, but you might have a check and balances
within to ensure it. So for example, let's say, a foundation decides to take more active role.
Now, from the outside perspective, we might say, well, that's like single entity.
So therefore, that's a tyranny.
But at the same time, you can also imagine that as long as, for example, within the foundation,
there are perspectives that can provide both, then that could be OK.
Right. So, for example, within, let's say, a foundation, it might be also possible that
Or it can also possibly that, like, even if there's no DAO participant per se, if there's like different perspective that can be provided within the foundation, then there is also some formal check and balances.
So I know this is a bit unorthodox way of thinking about it, but that also can be something that's actually rational as well.
Well, there's also the issue that I see is that a lot of people look at traditional government models and traditional financial models and they say, no way, we can't do that. It's too similar to the way that it is currently in the traditional
systems and the centralized systems. And the reality is it's not one or the other.
It can be both. It can be, let's take the best part of both systems and let's implement it.
And so it sounded for a minute there like you were alluding to the fact that dows should elect presidents did i was that totally off base for me to to hear that well
i i guess my kind of perspective is like it can be president it can be coalition but i guess my
point being that like it's possible that there is basically a like a single entity or power, which itself from the outside might be seen as tyranny, but inside can be considered as a single point of power.
But inside actually can be check and balances.
So I think that's a bit different perspective where because we like to say, let's say there's like foundation having a strong control over it we like to say well this foundation is
basically being less tyrannical or aspects but at the same time it's also possible that within the
foundation to have the checks and balances as well like like in a way that this power balance
is not necessarily have to be like completely like i think the good way to think about is like
people ask how is the you know people talk people talk about peace and war, right?
Like, you know, there's like wars everywhere.
What's the way to, for example, prevent wars?
And some people might say, well, the way to prevent war is to basically ensure that they are balanced, like checks and balances.
But if you think about it, actually, another way to maintain peace is have absolute haja money, right?
So like, you can imagine that, like, if, for example, this is like the reward, if, for example, somebody tries to, let's say, invade somebody, and then their country will be completely, you know, like, destroyed by a third party that's overseeing the peace, that itself is also absolute hazard money that's keeping the peace.
And that also is potentially possible.
If there's a single entity that has absolute power or at least a sway,
and is able to, for example, watch over this public good,
whether it's Dow Tre Trader or others,
that itself technically is also a way to preserve this, you know, whether it is, you know, resources or others,
that also can be an option. Now, it's of course uncontrib... like, I would say it can be of a controversial aspect.
And then I think that is definitely something that from the governance or from at least like crypto aspects, like don't think about it.
But it is definitely also a way to, for example, preserve, you know, continuity as well.
And especially if you think about some of the L1s aspects, I know that some of the participants might criticize them as being more centralized.
But at the same time, they also have some of the participants might criticize them as being more centralized but at the same time
they also have some of the benefits right they say they're more efficient they're able to channel
their resources more they're also able to respond to emergency you know faster so once again like
there are both pros and cons but at the same time like it also can be one of the feasible way basically
so in the in the context of DAO decision-making,
what's looked at from the outside perspective, right?
We all know that there are cartels and cabals
and all that mess that goes on
and everything will always corrupt.
But the delegate working group, for instance,
or the delegate reward program that you were a part of,
would you mind speaking a little bit to that
and maybe some of your controversial opinions
about how delegates should be or should not be compensated
based on what they do and don't do?
Yeah, sounds good.
And yeah, I must admit that the proposal itself,
like for example, compensating delegates was controversial for many reasons.
And I think that there's actually a lot of confusion among delegates as well.
Because and I think that maybe it also reflects on some of our our philosophy and my philosophy as well, because especially for UNISOB delegate program, it has changed over the years.
But some of the aspects were like, how like, because especially for the cycle two, it was very, you know, favorable toward some of the newer delegates.
Because for old delegates, they have to basically vote in the
constantly and therefore new delegates they were able to kind of start fresh and then for example
even like start recently and if they voted pre constantly they will be basically having higher
points and i think that this was also relate to that there's definitely power aspects that can
corrupt if not unchecked or even if it's like
within like at least having given the opportunity right so um but i said before that i think that
it'll be good to just talk about the program itself right so for uniswap especially is one
of the oldest styles people probably remember that they were able to get uniswap airdrop
by interacting on unisOF long time ago.
In fact, you can still claim it technically if you find this somehow.
I know there are some friends who accidentally find, you know, well, let they use UNISOF and they still claim it and able to participate, right? And then there have been a lot of different
delegates that participate in governance for UNISOF for a long time. Now, for many years, there was, of course, the discussion about having compensation
or like reward program for delegates, but every time it was a bit delayed, and we're also aware
of it, that it was delayed because they felt it was not ready, or there were some details that
they want to have. And I think that's always kind of true, right? In a way that the program, of course,
is very appealing to delegates, but it takes a longer time to try to convince the DAO and also
other participants. And that was also true that when we looked at the landscape, and then we also
believed that it was really needed because A, it's one thing that people can disagree whether delegates should be paid or not,
but it can be also argued very easily that for proposals that people are supporting, it's important to ensure the quorum is met.
Now, what that kind of means is that you can imagine that, let's say in conflict, I know that i don't i shouldn't really give you
really good examples but let's say that like in real politics if you think about it there are
politicians right there are congressmen and they go to congress and they vote but imagine a case
where basically the voting is not going because yeah like you know because like the congressmen
just you know don't show up and then or there's just like not much interest right so then it can be a problem that for the proposals that is actually beneficial
for the community is not going through because the quorum issue and it also brings another aspect of
like there could be potentially malicious votes that goes through because there are not enough
people checking right because if there's malicious proposal delegates or government participants are supposed to give comments and also if it goes to the voting
vote against it but if they're not enough then this is more likely to happen right and we already
saw this with some of the other thoughts that happened so in this regard that it makes sense
that we need to have a program to incentivize delegates.
So before actually there was the Uniswap Delegate Reward Program, what actually happened first was to have a Uniswap Delegation Program.
So what that means was that we have recognized that a lot of the key VCs and investors who held uni, they were actually not really keen
to re-delegating. So for example, let's say that they delegated them at the beginning of the
uni sub token launch. And many years later, a lot of those delegates who got a lot of delegation,
they haven't voted for many years, because they're they're busy. You can imagine that they might have voted for first year and then they're like, well,
there's no compensation.
I'm so busy.
This is above my pay grade and they just don't do it.
But in theory, then those investors should be
delegating these to delegates who are active, but that doesn't happen.
Right.
And then we have also asked them as well as like others
have asked investors and also other participants why and there are like many different reasons and
it can range from what is like a legal to logistics to simply that they're too busy
and you know for that or too simply that they don't really think that's a big part because
they think the price itself speaks.
So there are many different reasons,
but one thing that's for sure is that they're very, very not flexible
when it comes to redelegation.
In theory, they should be redelegated,
once delegates that they delegate to is not active.
This is almost like imagine that you elected a congressman
and this congressman doesn't really show up to
even go vote. But then, you know, this, you know, person
either could be removed because of law, or, you know, get
replaced last, you know, next time, but because in doubt
governance, such rules are now so clear. So that means that a
lot of times, you might have new delegates who are active, but
they're not getting the delegation, because they should be getting the new delegation because they're active and interior also participating.
But they're not.
How often in a perfect world, what would you say?
How often should there be some sort of delegate race go on?
Is it every three months, every six months, every 12 months that they'll call it the foundation
of the DAO basically emits more delegation from the treasury? Oh, well, I think that more aspect
is a bit different. Like for example, right now, so Tane team, which is another delegate,
has been also discussing with some of the other delegates to prepare the next phase for this municipal delegation program. And for them, they suggest 18 months, but with the expiration.
I think that anything that's around the year or so makes sense. Now, you might wonder like,
okay, why can't we, for example, do three months or six months and that's partly because a um a lot of those who are there's definitely some consistency to it because once
you have elections too often then those delegates also need to prepare and like compete right so of
course you want them to compete but you also want to balance out between like having it too frequent
because you you also don't want them to just focus their time just on the competing aspects for the you
know races per se right um but for this um so right now is 18 months but ideally at least from
the delegators they should be able to reconsider their delegation like every year, I think is ideal.
In reality, it doesn't really happen.
And even for example, when UNISOF had the delegate race, like, actually, the delegation
from a lot of the top VCs were still kind of limited.
I mean, yes, there were some that happened.
But like afterwards, like there was many years ago,
right? And then that hasn't happened. And even for example, there's a new one that's happening.
I don't think that you will be as active either. So I know that we kind of went too back. But
basically, the idea was like, even before the reward, it was important to ensure that delegates
who are active, and also acting in good faith were basically given
more voting power. Now the reason why that was important is that then it's also able to
help to meet the quorum right and also ensure that the government goes through. And also it's a very
important aspect that we were able to show that back then there was no units of delegate reward
yet but they were able to vote very consistently right there was no unisop delegate reward yet but they were able to
vote very consistently right basically the idea was like you basically give more responsibility
and give more voting power to delegates who are willing to be more active and also want to act in
good faith and that we're going to have a positive response so that was also the aspect or basis
that we're able to use to say hey so there are these delegates who are being active.
And also many of those delegates have been active for many, many years.
So they also deserve to get rewarded for it.
Now, of course, there were a lot of aspects that were people against others.
And the thing is that the good thing about democracy is that everybody's
wrong and you realize that you yourself are wrong. So technically everybody's wrong. But at the same
time, there's comes to some kind of consensus, right? So that's also why that a lot of the
aspects for unit sub delegate program for reward is mostly objective. And the reason why I say
mostly is there are still some parts that technically can be subjective and we try to make objective as possible.
But as German philosophers can tell you, technically that itself can be subjective.
So we try as much as possible, but that's also the reason why the program is said like that at the moment. So dude, just to understand a little bit better, for some of those metrics that you consider when, you know, qualifying a delegate as active, what are some of those metrics that you look at?
Yes, so there are definitely like three main aspects. Now, I think I'll start, I mean, so for the voting history itself is the major part.
Now, of course, I got a lot of questions like why does that matter?
And then the good example that we talked about was kind of the congressman, or if you think about it,
if the reason why somebody got a delegation is to delegate, like represent their position
by somebody got a delegation is to delegate, like represent their position and let their
position know, then this delegate not, for example, voting at all means that he's not
actually exercising what he's supposed to do, right? Or she's supposed to. So it's possible.
Well, the question I get is like, well, then they could technically not vote to make a statement.
That is true.
But that's also why there is something called abstain, right?
Like there's a voting called abstain.
So technically, if they want to basically make a statement by not voting, they can vote
to abstain.
And also what's important is that they have to explain also their decisions, why they're
abstaining or like they're voting against. Right. And then so the reason why the voting itself is important as well as having this
kind of habit or like having this culture of having a rationale is also because delegates
are human beings as well.
And also, A, they might vote something and have a wrong understanding.
Right. It also happens to me sometimes that I thought that this proposal covers this, then this.
And then at the same time, like it comes out that actually it was not right.
So, or it's possible that maybe I'm voting against it, you know,
or somebody's voting against it because he killed somebody's cat, you know, who knows, right?
So it's important to actually, you know, let the committee know so they can challenge you if needed.
So that's the voting part.
And then the second part of the proposal is also important because good proposals that have passed are also beneficial for the proposed growth.
So and then also development.
Right. So it's also important that delegates were active in drafting proposals. The reason why the important part is passed is because if it was spent
and didn't pass, then it shouldn't count.
So that's another important point.
The last point, which is I think not as important as others,
is like other ways that they contributed, whether that's through the calls
or whether they attended, for example, at the workshops
to better improve it.
Because once again, beside voting and also beside making proposal, there's also other ways to
contribute to DAO. So that's why these have been in there for past few cycles. Now, cycle three
has changed a bit, but the logic kind of applies. I want to double click into the protocol growth
piece here and how that is more than just important.
But in your opinion, when you try to balance sustainability and innovation, how do you think about risk management versus aggressive growth and experimentation in the DAOs that you work with?
So it's actually much easier to justify growth.
Like, I mean, that's also the rule, I think, in DAOs as well,
because DAO technically can be very, very sustainable,
but eventually it's going to die out because it's such a competitive society.
Like, it's such a competitive environment, right?
Like, for example, we talked about stable coins a lot earlier, like today.
And yes, there are a lot of stablecoins that grew a lot and then faded.
But there are actually a lot more stablecoins, a lot more DeFi that people don't even know about
because they were not even able to do experiment or have like basically keep innovating.
And then one aspect that like even back at Sky that we talk about is that it's important not to feel content.
And then the reason why that's important is because we learn from our experience, right?
Because there was a time that maker, like for some previous code maker, used to account for 90% of DeFi.
But then I remember we were always having this, you know, kind of discussion about there was a time that Nokia used to take over the world.
Now people don't really talk about Nokia. There will be only somebody in the
call say they still like Nokia, and I
understand it, but that was not the point, right?
The point being that unless you continue to innovate
and also try new things,
there will be some other competitors, and also
there will be more and more, let's say,
market changes, and
the system wouldn't be
able to be as flexible or have different aspects.
So that's why I think it's quite important to have those experiment aspects.
Now, of course, with the caveat, I know I said caveat quite a lot, but at the same time,
it is also important that experiments also have the aspect of knowing what is the delivery
and what is the expectation as well as like what
are some of the other plans right because experiment for the sake of experiment is not
as helpful as for example experiment that will be able to grow this and that i think that one
of the good example that i can address i know this is a bit less on the unisov aspects but like for
example sky perspective was the r, which literally cost the millions
to trying to build it, but was able to grow much more.
And as a DAO, we knew that it was very risky, but at the same time was able to basically
test it, learn the lessons, some of them defaulted, okay, and the longer lessons and how can we prevent that in the future. That
is same for UNISOV as well, like UNISOV has different
experiments. And whether that's for example, growth through like
this marketing perspective or growing through, let's say this
grants, or others, like, basically, how can, for example,
doubt learn from it and improve from it, I think will be the key
aspects.
Yeah, dude, just to double click
there who do you see is like responsible for uh experimenting creating that uh sustainable growth
is that like dao is that the the foundation or is that labs i think that that's actually like
can be all of that and then also I think that it can be something that,
because it's not mutually exclusive, right?
Like one of the example that we talk about is like,
so GFX, which is another delegate in Uniswap,
they had a lot of proposals
that were actually able to grow further, right?
Like they had, for example,
a lot of the multi-chain proposals they have.
They also previously had some of the new fee structures they had.
And they were actually able to grow revenue for the whole ecosystem.
And, you know, they are not from the lab themselves.
You know, they are the participant.
Of course, they got grant from the foundation before.
So you can imagine that this is also kind of the collaboration aspects.
And then also where like ideas can
come from everywhere. I think what's important, of course, is to ensure that whatever the
experiment and growth there is, is something that a has some consensus, or even if it's
not consensus, then somebody is willing to, even if somebody needs to push through it,
basically be responsible for it. Like, you if the Uniswap Foundation says that,
hey, we're the ones that want to take charge, that's also fine.
But they also need to take responsibility for it.
So that's kind of how I think about it.
Do as the protocol evolves, what else does Uniswap need?
What are the biggest holes in the game?
So as the protocol grows, there's definitely going to be aspect for like growth.
Once again, growth is good, but at the same time, then you need to prepare two things, right?
A, what happens if the plan fails?
I think it's kind of important because and also that has been actually one of the big
downfall for a lot of DAOs is that, yes, you need to grow farther, but not having the risk analysis, not just from the protocol
risk analysis, but let's say like that's from the, because even for
traditional companies, they have different plans, right? What if
their new product doesn't sell well, you also need to have a plan,
right? So I think that that's definitely the aspect that I think
you need to as a DAO and as well as overall needs to kind of think
about is like, how can we make sure that this is more sustainable?
I run to get by growing, right?
Like you grow, that's fine.
But at the same time, how can we make it sustainable?
Like sustainable growth aspect, I think the key aspects.
Also, another aspect that's going to be important, especially with the new Unichain would be like,
okay, now they launched it, everybody knows it.
Okay, how can you make it successful?
Right.
And I think that this is also where like, it's a combination of both business,
marketing, as well as like developers and others.
It's like, okay, because now the genie is out of the bottle, right?
You cannot really, I mean, technically you can, but now you have to grow it
and make it successful.
So I think that that'll be kind of the, I shouldn't say like missing part,
but it's something that will definitely be in effect.
And we already know because like, for example,
there's already passed a proposal to incentivize Unichain
and also the foundation has several plans.
So I think that this will definitely happen.
happen dude i gotta i got a fun question for you um if you had total control of the of the uniswap
Dude, I got a fun question for you.
dow treasury you're delegated you know 41 million uni what would you do uh i would probably delegate
away i mean so so in case i mean i think this actually happened in some of the, I mean, I know this is like beside this point, but there are some of those that happens, right?
Where like we do have like majority aspects or like more than double the power of other delegates combined happens sometimes.
happens sometimes. But at the same time, like then it's important that we recognize the
responsibility of power, right? Because it is true that absolute power is more likely to be corrupt.
So in such cases, it's better to be a coalition than being a single person. Because once again,
so when we talk about the, let's say, if it's a foundation leading it, they need to be
responsible for it, right? Like. It's important that if you have
a great power, then you're responsible for it. And in such case of us having a majority of power
for deciding everything, I think that what's important would be that we have members that are
helping the DAO and able to grow together. Now, is there a case that like, I do think that there's very like
sometimes rare cases where it can be used to safeguard against like malicious aspects. I think
there are some DAOs that for example, their guardians that are acting just for them. Of
course, when we talk about Uniswap, I think it's more likely that what's going to happen is that,
okay, like, we're gonna try to divide it up. And then because we also generally believe that if we want,
and that is our goal, we're going to aim for it.
But that was never really the goal from our perspective.
Gotcha. Yeah.
I guess with great power comes great responsibility.
Yeah, that too.
You're getting delegated 41 million uni.
Yeah, I i mean that too
and we only always like to say that it's the yeah you know we also you know what i like to say is
the journey that counts right it's the governance journey and the ptsd we share that uh is important
yes collective dude we have uh we've always really enjoyed your based commentary on the forums where where else can people follow your work
so they are can follow me on my twitter where i sometimes post a lot of the
interesting but can be a bit uh korean humor uh can be dry but also it's funny uh they can also
of course follow our um state lab. And then also can see our
action on the Uniswap forum as well.
Sometimes it can be controversial, but
at the same time, that's the point of this
podcast, right?
Absolutely. No, that's...
You're spot on.
We'll go ahead and wrap up here.
Du, thank you so much for the insights.
This is another episode of the
Ungovernable podcast. For our listeners, please follow Du and follow us at Grow Uniswap to stay up to date.
New episodes every week.
And don't forget to subscribe on Spotify and YouTube.
This is the Ungovernable podcast.
We are Joe and Austin of Alpha Growth.
See everybody next week.
Thanks again, Du.
All right.
This was the Ungovernable podcast by alpha growth.
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