KyberDAO-Starting-BRR-Process.md

Starting Framework For KyberDAO BRR Process

1. BRR (Burn, Reward, Rebate) ratio will be voted on in every epoch.

The BRR proposal process will provide a clear ongoing agenda for stakeholders to tweak the status quo, allowing a constant polling of the community and dynamic governance of the network fee allocation. Custom proposals suggesting major updates can be created as part of the Kyber Improvement Proposal (KIP) process.

2. Starting Framework

As the KyberDAO maintainer, the Kyber team has proposed the starting framework for the BRR:

• There will be 4 options for each BRR campaign, one retaining the status quo, the other 3 preferring one specific parameter
• Allocation for the new preferred parameter will increase by 5%.
• The 5% increase would lead to a corresponding decrease in the % allocation of the remaining two parameters, in accordance to the original ratio between those two parameters.

As such:

Options	Implications
1/ Status Quo	No updates from current epoch
2/ Pro-Burn	Burn increases 5% from previous epoch. Rebate and Reward decreases proportionally.
3/ Pro-Reward	Reward increases 5% from previous epoch. Rebate and Burn decreases proportionally.
4/ Pro-Rebate	Rebate increases 5% from the previous epoch. Burn and Reward decreases proportionally.

The exact formula is detailed at the end. The BRR-1, which will be up for voting in epoch 1, will use this formula for calculating the options.

2. The first BRR Proposal: BRR-1

The first proposal on the KyberDAO will be a BRR proposal to decide if there should be changes to the existing network fee parameters. This will start at Epoch 1, on 14th July. This first BRR proposal will be labelled as BRR-1.

The current consensus on the initial Burn/Reward/Rebate (BRR) network fee parameters is:

• B | 5% will be used for purchasing KNC tokens and burning them
• R | 65% will go to Voting Rewards
• R | 30% will go to Reserve Rebates for Fed Price Reserves (FPRs)

Based on the BRR framework explained above, we proposed the following four options for the community to vote on during the first BRR proposal in Epoch 1, starting on 14th July.

Option	Burn %	Reward %	Rebate %
A. Status Quo	5.0	65.0	30.0
B. Pro-Burn (+5%)	10.0	61.6	28.4
C. Pro-Reward (+5%)	4.3	70.0	25.7
D. Pro-Rebate (+5%)	4.6	60.4	35.0

For example, for Option B, the Pro-Burn option, Burn is the preferred parameter, and Reward and Rebate are the remaining two parameters. Burn will increase by 5% to 10%, and Reward will decrease to 61.6%, while Rebate will be 28.4%.

3. Kyber Improvement Proposal (KIP) Framework

• As the DAO maintainer, the Kyber team is also scoping out a Kyber Improvement Proposal (KIP) framework to allow the community to **discuss and propose changes **for the benefit of the protocol.
• The Kyber team will submit the first KIP to facilitate discussions around its own starting framework.
• Please note that KIPs are unique proposals and different from the BRR proposals, which are more regular and are meant to follow a standard format and process.
• If required, the Kyber team will help submit a KIP to update the existing BRR process.
• KIPs have to be approved by the DAO maintainer (Kyber team) before being scheduled for formal on-chain voting on the KyberDAO.
• Future changes will need to be first proposed as KIPs and reviewed as a community.
• The community is highly encouraged to actively discuss all KIPs.

4. Starting Framework For Determining The BRR Options

1/ Status Quo

2/ Pro-Burn:

• New Burn % = Original Burn + 5%
• New Reward % = Original Reward/(Original Reward + Original Rebate) * [100 - (Original Burn + 5%)]
• New Rebate % = Original Rebate/(Original Reward + Original Rebate)* [100 - (Original Burn + 5%)]

3/ Pro-Reward:

• New Reward % = Original Reward + 5%
• New Rebate % = Original Rebate/(Original Rebate + Original Burn) * [100 - (Original Reward + 5%)]
• New Burn % = Original Burn/(Original Rebate + Original Burn)* [100 - (Original Reward + 5%)]

**4/ Pro-Rebate: **

• New Rebate % = Original Rebate + 5%
• New Reward% = Original Reward/(Original Reward+ Original Burn) * [100 - (Original Rebate + 5%)]
• New Burn % = Original Burn/(Original Reward + Original Burn)* [100 - (Original Rebate + 5%)]

I wish there was a way for us to structure kips as "ideas" and create like an "idea exchange" where community members vote on merits of kips or ideas and if implemented get rewarded/badged up.

this is a great idea - there should be a forum coming up soon, hopefully that can be done!

Hi ming. hope all is well. the best example of the process is how Salesforce.com implements it.
https://trailblazers.salesforce.com/successHome

1. Post and Upvote Ideas any time
   Share your ideas about Kyber products with the KNC Community and browse ideas that are being considered. Popular ideas that align well with the vision for the product may be placed directly on the release roadmap.

2. Prioritize quarterly or 3 times a year like salesforce.com
   During prioritization, you receive a P-vote allowance to spend on your favourite ideas.
   Spend them all on one idea or spread out your coins on several ideas.
   This is how they post and categorize the prioritization results.

3. Create Roadmap
   Ideas with the most votes move into Kyber Product Planning phase. Product managers then further refine the list. Keep track of the winning ideas to know when they make their debut.

Dear all,

I find the whole concept and direction really interesting, and I would like to see some kind of structured conversation / argumentation over the available BRR / KIPs. In this way, participants will be able to regularly make informed decisions, promoting the collective growth of the project and its community.

I am also interested in materializing the whole idea one step further. The 'wishful thinking' is to merge the financial aspects of our lives with the political / societal aspects that are currently mainly ignored / downplayed by most citizens, who simply transfer their power to representatives and do not communicate and argue their opinions / views over the different aspects. The whole idea is to have a liquidity pool, that will be used by a community / society / state / nation / globe as the main gateway for making any kind of transactions / exchanges. The gathered fees will be used as an incentives for promoting the transparent, structured, constructive and responsible participation of people in any kind of debate / argumentation / voting schemes and platforms, based on the principles of direct / liquid democracy. The main idea is to help people mature as political beings and prepare them for their active participation in any complex aspect of their everyday societal lives, starting from simpler ones, and letting them familiarize themselves with the importance and transformative power of the active participation in societal-related decision making, along with the acceptance of the outcomes of such processes. This approach will take advantage of the self-supporting loop of such a platform, that will be based on the current advances in Computer Science in various domains (cryptocurrencies, argumentation, fact-checking, deep-learning), and the effective incentive of monetary rewards.

I guess this could be a first important step towards a self-organized and self-governed, fair, inclusive, and responsible society.