[Phase 1] HIP #49 Change of Arbitrator

[donosonaumczuk]

Hi all, I can agree on the bad distribution of PNK token, taking into account that a “fair distribution” is really important for a justice protocol when using token-weighted mechanisms. And because of that, I agree with the arbitrator change.

However, I am not completely sold about using UBI as arbitrator token. I think PNK fixed supply is an important property for the Kleros mechanism to work correctly. It makes 51% attacks really hard and expensive to perform, as buying half of tokens having fixed supply will have a huge price impact (see Kleros whitepaper for more details).

I understand generating “artificial demand” over UBI token is needed, but I don’t think it will be done at cost of Proof of Humanity court security. And I think it is important to think UBI as a project that uses PoH, not as the same one.

If UBI is used as arbitrator token, because of its constantly increasing supply, I would say that it will be easy for a whale to attack the court in a cheap way. Even if we argue that the increasing supply is constantly diluting whales, that’s true in the perspective of UBI balance (looking at it just as ERC-20), but not sure that will be translated to the court/juror context. All jurors should be constantly buying UBI and staking it in the court to fight potential whales that appear, it does not look as a desired behavior (aside of the fact that will increase UBI demand).

But I didn’t came here to criticize, I have a proposal: HPNK.

You can create a new ERC-20 token, let’s call it HPNK (Human PNK or Human Pinakion). So every human already registered in Proof of Humanity will be able to claim a certain fixed and equal amount of HPNK (note that HPNK have fixed supply).

Then you can change the arbitrator to an identical one but just using HPNK instead of PNK. All properties designed by Kleros team will still be there, as the HPNK follow same properties as HPNK, but with the difference that is “fairly distributed” to all humans in the registry. This means the DAO will be achieving its goal of self-maintainance of the registry without putting it on security risk.

Implementation is also much more easier, which is also important to reduce the chance of any kind of exploit.

Only drawback I think you can mention is that this does not give utility to UBI token. But as I said, for me is important to see UBI and PoH as different things, the former depending on the latter, but not vice-versa.

[santisiri]

@donosonaumczuk

You can create a new ERC-20 token, let’s call it HPNK (Human PNK or Human Pinakion). So every human already registered in Proof of Humanity will be able to claim a certain fixed and equal amount of HPNK (note that HPNK have fixed supply).

Alan, I think the analysis in your reply as a whole is a must read to everyone groking this thread. Thanks for sharing your input.

Something I’m actively talking with @clesaege consists about allocating the 2.1M UBI the Kleros Coop withdrew from the liquidity pool on Uniswap to a new LP with the PNK token…. this plus the fact that Kleros is debating a KIP to airdrop PNK to humans I think will help align better the interests of both communities.

How could an UBI <> PNK liquidity pool be helpful in any way to the HPNK strategy you are thinking about? are there things that could be thought with Aave as well?

[leonelmessi.eth]

muy interesante alan

[donosonaumczuk]

@santisiri

Alan, I think the analysis in your reply as a whole is a must read to everyone groking this thread. Thanks for sharing your input.

First of all, thanks for the compliment, a pleasure to contribute here.

@santisiri

How could an UBI <> PNK liquidity pool be helpful in any way to the HPNK strategy you are thinking about?

I personally don’t see any way to help the HPNK strategy through UBI or PNK. I think HPNK should be a fresh unlinked token. But I’d love to hear more ideas.

In telegram channels some discussions around HPNK already started, surpringly fast! One of them about if HPNK should be claimed by humans on a PoH-registry snapshot at the time of the HPNK release or if it should be able to be claimed by every future human registered in PoH (I think we should be careful about double-claims, but @ludovico @juanu mentioned PoH v2 SBT ID for preventing that, the problem is that will delay the arbitrator change until PoH v2 release).

[clesaege]

@donosonaumczuk

its goal of self-maintainance

I think that’s where we may have differences. The goal when we created Proof Of Humanity was to be the best (in term of security and ease of us) sybil resistant registry.
“Self-maintenance” by itself doesn’t achieve anything. It can only be tool. Here I think this would have a negative impact on the registry by lowering security and putting the project outside of the Kleros ecosystem.

If the project wanted to be completely “Self-maintaining”, it should also make his own chain (but would require extra work, have lower security and cut itself from the Ethereum ecosystem).
The case with Kleros is similar.

@donosonaumczuk

You can create a new ERC-20 token, let’s call it HPNK (Human PNK or Human Pinakion). So every human already registered in Proof of Humanity will be able to claim a certain fixed and equal amount of HPNK (note that HPNK have fixed supply).

This would still suffer from the same issue of not mutualizing security with the wider Kleros ecosystem.

[littlestar]

@santisiri

The examples mentioned on my reply can be googled so you get a sense of what they are about, that’s why I included them. There’s obviously way more than that, you can check http://paper.democracy.earth to see the many avenues that where explored during that time to pursuit our goals.

We have made a paper that details the pilots we held in places like Hong Kong, Colombia, Colorado and with other web3 companies like Blockstack. You may find it here: http://www.dropbox.com/s/wzf7n7n5fhf09zx/Democracy%20Earth%20Pilots%20Report.pdf?dl=0 … The pilots helped us understand how to do elections using blockchain, different models of democracy that make sense according to specific contexts and identifying the core aspect to solve: identity.

It is not clear how this was spent on UBI particularly, looks more like an unrelated governance initiatives.

@santisiri

Things might seem obvious today, but they weren’t back in 2018. If you enjoy voting democratically with Proof of Humanity, we do too and take pride in the fact this is indeed the most democratic DAO in Ethereum. How to achieve this was not clear at all back then.

The study of different Proof of Personhood projects which lead Democracy Earth to choose Proof Of Humanity is the only thing which seems to me as UBI related. 1.2M$ is quite high for just assessing to use a project made by Kleros.

@santisiri

1.2M in the context of the 2017/2018 bubble was actually a small raise and we didn’t do an ICO or stuff like that since it was a regulated offering in the US, keep in mind we are a Californian company. Democracy Earth had a team of 6 full time engineers / product managers / researchers employed in New York and San Francisco plus more than 100 volunteers from different cities around the world that helped us implement the pilots we held.

Why did you pay San Francisco salaries for a project of basic income? It seems most of the money went to pay SF salaries and not for UBI which is only worth 0.5M$. (conflict of interest)

@santisiri

If you get a sense what are the market rates to hire engineers there, you’d realize we did a good job.

The outcome you showed seems pretty small. I don’t even know if those would be enough for a PhD candidate to pass, so it doesn’t seem in the range of a 1.2M$ work.

Could you possibly show any transparency report detailing the use of the funds, the average salaries paid, etc?

[santisiri]

The organization files its annual reports as a 501 c 3 to the corresponding governmental entities in the U.S. and its donors (which include Y Combinator, Templeton World Charity Foundation, Shuttleworth Foundation among others). I shared with you reports already on the research and pilots we held which are open to the general public. If you think building a global community around digital democracy happens overnight, there’s not much I can do to convince you about the value of our efforts.

Democracy Earth started and still is a non profit organization that aims to research democracy in the Information Age and it does so by contributing and building to open source tools, using censorship resistant networks for free to the world. Proof of Humanity and UBI are by far today the top priority of our efforts and contributions. Back in 2018 this wasn’t clear to us, consider that PoH wasn’t even coded nor mentioned anywhere back then.

When we started it wasn’t clear to us what would be the path towards digital democracy on the internet. But we built for that goal since the very beginning. Today it’s definitely more evident that smart contracts, Ethereum, Proof of Humanity, UBI are the places we want to build with.

[littlestar]

@santisiri

The organization files its annual reports as a 501 c 3 to the corresponding governmental entities in the U.S.

Could I, as one of UBI holders, get some access to this report? Specially the public financial statements over the last years?

@santisiri

its donors (which include Y Combinator, Templeton World Charity Foundation, Shuttleworth Foundation among others)

You mentioned there are some donors, so it means Democracy Earth got even more than 1.2M$.
Did Democracy Earth actually use the money of the UBI sale for purposes other than UBI?

@santisiri

Proof of Humanity and UBI are by far today the top priority of our efforts and contributions.

@santisiri

Today it’s definitely more evident that smart contracts, Ethereum, Proof of Humanity, UBI are the places we want to build with.

You do mention Proof of Humanity most of the time. Did Democracy Earth make any financial contributions to create Proof of Humanity?

Also other side projects like Yubiai marketplace are funded by other organisations. Is democracy earth
currently funding any project related with UBI?

[donosonaumczuk]

@clesaege

The goal when we created Proof Of Humanity was (…)

Take into account I wasn’t talking about the goal of PoH itself but the goal that the DAO (or rather some DAO members) are trying to achieve through this proporsal. I could have expressed myself wrong.

@clesaege

If the project wanted to be completely “Self-maintaining”, it should also make his own chain (but would require extra work, have lower security and cut itself from the Ethereum ecosystem).

I agree, as I said I could have chosen incorrect words. I think the idea is not being completely “self-maintaining” but DAO members achieving bigger impact in the courts. I know this could be done just by buying PNK, but looks like some DAO members are specially concerned in how is that token distributed among holders, they want to dilute whales, which I think is not easy to do at this point.

@clesaege

This would still suffer from the same issue of not mutualizing security with the wider Kleros ecosystem.

I partially agree with you here. I agree on that the higher the demand for the arbitration token, ceteris paribus, the higher the court security. So PNK having demand because all Kleros ecosystem is better than a new token which demand is only generated by the PoH court. But I think that if the new token is scarce it could be secure too.

I also want to flag that I don’t think that having a new token is the ideal case, but the alternative is just doing nothing. So if the DAO decides to perform an arbitrator change, I would rather use a new token that follows Kleros design properties (i.e. the proposed HPNK) than other that does not (e.g. UBI).

---

Lastly, I think is fair to mention that I’m not an official member of the DAO. I’m not registered in PoH nor hold any UBI. I’m participating in the discussion because:

1. I found it interesting in political/governance terms.
2. I am interested in PoH future and I was worried about the project security being put in risk if UBI was chosen as arbitration token (reason why I came with a “mid-point alternative” that allows achieving proposal goal but, to my consideration, highly reducing security risks).

[system]

These are very fair questions.

The Kleros cooperative is very clear and transparent about where money is spent, publishing an annual report. Kleros Annual Transparency Report 2020. We can expect the bare minimum same from Democracy.Earth.

Why should PoH use a $ubi token which had a premine (https://etherscan.io/tx/0x9d087e4ba6ee12f79276bd64ebb75d7965ea8c92c5354d2fe8976fb4771518b9) for a whale?

[system]

Why should PoH trust Santi when he encouraged (https://twitter.com/santisiri/status/1370800372722323462) users to provide exit liquidity for the whale?

Here (https://twitter.com/santisiri/status/1370178053746388998?s=21) Santi falsely claims that the investor sold off his tokens, and the next day he asks the community to add liquidity to the ubi pools. A month later, the whale dumps his bags of 600k+ $ubi. Santi’s actions are at worst fraudulent, at best, criminal negligence, not even using a block explorer properly to check the whale’s bags before using his social media presence to gather exit liquidity for his investor.

[system]

adding links

A month later, the whale dumps (https://etherscan.io/tx/0x2a2f2da847345a5662a981fc8595d27844af32283938341e2715a1766c52772c) his bags of 600k+ $ubi.

Why use Democracy.Earth’s version, $ubi classic, instead of Green’s $ubi ? @green made the improved version in a few hours of work. Any solidity dev can see that Democracy Earth’s $ubi classic contract is very simple and under optimized. Where did the $1.2 million USD go? @green made the contract without paying himself a San Fransisco salary. You didn’t hire a competent solidity dev with experience? Did Democracy.Earth help build the smart contracts or infrastructure of PoH in any way?

If this proposal moves forward to Phase 2, I recommend deploying and using Green’s $ubi implementation with a new deployment, starting balances fresh.

This would remove all whales, and start with a fresh slate, tabula rasa. No cooperative, no Santi whale, no Democracy.Earth premine investor. Democracy Earth’s $ubi classic is inefficient, and tied to Democracy.Earth’s premine investors, and the bad history of Santi encouraging LP for exit liquidity. Why would anyone trust or provide LP to liquidity pools for $ubi classic knowing this history? There’s only 30k usd in the liquidity pools currently. Let’s face it, $ubi classic is a San Fransisco startup investor backed experiment by non solidity devs.

Let $ubi be born out of the ashes of Democracy.Earth’s $ubi classic, and let’s launch it properly without any premine for investors. Let’s do this the Web 3 way, not with politicians and investors from San Fransisco.

Let’s leave San Fransisco out of $ubi

[juanu]

@kaprikosa

@green made the improved version in a few hours of work. Any solidity dev can see that Democracy Earth’s $ubi classic contract is very simple and under optimized. Where did the $1.2 million USD go? @green made the contract without paying himself a San Fransisco salary. You didn’t hire a competent solidity dev with experience? Did Democracy.Earth help build the smart contracts or infrastructure of PoH in any way?

I agree that green’s implementation is more efficient, however green has not considered the work some of us devs have put into adding features to the next version, which we werent paid for to do.

His implementation of delegation is missing a lot of consderations that have been thought and analyzed in the past, includijng mechanisms for brdging UBI.
He, himself, stated that the he implemented the code without having a full understanding of ERC20s, Upgradable proxies, or how state variables actually are stored.

Don’t get me wrong, I encourage people to help development, and I think he is trying to do so, but his way of doing his version of UBI without considering a lot of topics discussed and iterated over the course of a full year is not too web 3.

We are all doing this because we wanna see UBI grow, but trying to implement a new version disregarding the work of us devs working for the good and not for the money is just BAD web3.

[santisiri]

@kaprikosa

Let $ubi be born out of the ashes of Democracy.Earth’s $ubi classic, and let’s launch it properly without any premine for investors. Let’s do this the Web 3 way, not with politicians and investors from San Fransisco.

I won’t contribute to the false narrative and anon attacks being portrayed here. But if you need to know, we didn’t have neither politicians nor venture capital firms investing on UBI at all. To my knowledge it was all individual angel investors, most of them contributing to the foundation rather than looking for a return on their investment.

@littlestar

Did Democracy Earth actually use the money of the UBI sale for purposes other than UBI?

Yes, if you cared to read my replies you’d realize that our goal was working towards tools to enable digital democracy. The way the market shaped up our decisions led to contributing to the Proof of Humanity and UBI we know today. You are talking from a perspective of someone that already knows everything that happened. I’m sharing you the details of someone that didn’t know what was the right path to success for digital democracy and had to do pilots, proof of concepts and worked with multiple technologies (including bitcoin, blockstack and other non-EVM networks back in the day). Here’s an old presentation that should help you get an idea of the multiple proof of personhood projects we researched, way before PoH became what it is today: Dropbox - Democracy Earth Foundation - TWCF March 2020.pdf - Simplify your life

Today we are focused 100% on Proof of Humanity and UBI. We have never sold UBI tokens. I have personally contributed as an LP for UBI during the liquidity farming period. And pretty much every tweet or comment I put out there was to help the project, not to damage it. I think that Democracy Earth is definitely responsible for bringing the vast majority of users to Proof of Humanity and that is a consequence of all our past efforts.

I want UBI to succeed since day zero and helping, teaching, recommending users how to become a Liquidity Provider, use Uniswap, learn about Proof of Humanity suddenly being painted as a negative thing is quite frankly hilarious.

Regarding the whale I’m as pissed off as anyone that it decided to sell early on. This is a person from Hong Kong that participated on the pre-sale and waited for 3 years for his tokens. He sold most of it at a significant loss, which is quite frankly absurd to me. There are legal restrictions to what you can or cannot do under a regulated offering in the United States and I have no intention of breaking the law. A regulated offering has privacy restrictions among other things and I will definitely follow recommendation of my lawyers.

We can also talk if you want about the whales that entered later in the project like Vitalik Buterin himself who bought and burn 50 ETH worth of UBI one day and then he kept on buying and accumulating until he reached the first place among holders. That action itself led to many people discovering between $300 to $5000 worth of UBI in their wallets next day and it led to some of the beautiful stories our users shared with Pope Francis (who now also supports UBI thanks to our efforts): https://twitter.com/santisiri/status/1543675696165359617?s=21&t=CYe2lfNwCtBsRype3hJymA

Throughout 2022 I have announced projects being built with UBI with Pope Francis and Bjarke Ingels. Hopefully these will help UBI adoption moving forward into the future. My goal is to get every single relevant powerful voice that has spoken favorable about Universal Basic Income on the past to coordinate that message around the UBI we have built. Thus why I tell the community to spam Elon Musk or why I tried to reach people like Pope Francis, came with Vitalik to Argentina where he met an ex President and the government with me, partnered with Bjarke Ingels and hopefully many more in the future. None of that happens for free, these are efforts that require time and money. So a token it’s never really just a token.

From my understanding of the proposal it has already received a couple of recommendations to use alternative tokens like HPNK by @donosonaumczuk or an UBI cheaper to transact by @green which actually has already contributed to the UBI code repository and is actively talking with @juanu since he has already developed UBI v2 — I have no issue with exploring those avenues at all. Glad to see openness towards alternative tokens!

[juanipose]

Has this HIP became into the field of personal/ political accusations?
Are those accusations new, or even pertinent? They sound like noise to avoid the actual HIP proposed.

Back to the conversation, I support the HIP #49 without the change of token, initially. I let the authors know that I want to join them and I encourage all in favour to do the same.
More decentralisation should be the north of our DAO.

[system]

If a $ubi token is considered, it’s in the scope of discussion to discuss which $ubi token is best. Should it be the $ubi classic token developed by Democracy.Earth with an investor and premine and exit liquidity fraud, around which the UBI DAO classic is coordinated, or should it be a new $ubi token, that’s more efficient, optimized, and doesn’t carry the same baggage of Santi’s call to action to help his investor exit. This would mean a new UBI DAO coordinated around the new $ubi token, @green 's implementation would be the best candidate.

[santisiri]

My understanding of the recent discussions of HIP 49 is that a change of token will no longer be proposed… and I think @juanu already addressed the problems with @green’s implementation. If a fork of UBI happens in the future, that would be definitely interesting to see imho.

So… taking into consideration that some of us actually listened to the feedback provided on this thread and helped keep PNK in the proposal due to the risks of changing a token that where shared here; the fact that some talk about a greedy take over is laughable.

If anything I think this proposal is mostly about further democratization of the different components that build Proof of Humanity. No UBI whales nor anything like that will hold more power.

[green]

I am flattered, and I find the UBI Classic - UBI distinction hilarious.

@green 's implementation is a new token, and a new UBI DAO.

I certainly haven’t made a new UBI DAO but, I wonder about the general sentiment on this. My plan was that, if this new UBI was developed like this, to just make a contract to migrate from the old UBI to the new one, so that the humans that have been accruing can redeem back to a cheaper version. The challenging aspect is migrating all the products to use this new version (this is the downside to not using a proxy)

[santisiri]

If someone figures out how to make a better UBI, i’ll be a champion of it.

Hopefully we can all collaborate towards that common goal. I’m sure there are a zillion things to improve on UBI today… with @juanu we took the direction to double down on the merits of a streamable token and I have high hopes on how that can open up many new use cases in crypto while killing gas costs in a multi chain world.

[ludovico]

Could you make a separate thread? I don’t see the relevancy of this, especially when we are discussing something else in this thread. I would be glad to follow the new one and see what Santi has to say about this, but c’mon, stop the distraction and discus about the actual proposal.