How to Delegate Voting Power in the BancorDAO

This post was originally published on Bancor

Vote delegation allows community members to nominate other community members to vote on their behalf.

The vote delegation option can be accessed via the Bancor Snapshot UI; it appears in a dialogue box to the left of the current proposals.

After clicking on the ‘Delegate’ menu item, you are brought to a splash page with two input fields. The first, ‘To’, asks for the address of the delegate (the address to which you would like to assign your voting power). Snapshot supports both ENS domains, and regular ethereum addresses. The second input field asks for the specific Snapshot space, which should be set to bancornetwork.eth by default.

After adding the delegate’s address or ENS domain, the ‘Confirm’ button becomes active. Clicking this button will call Metamask and ask for a confirmation of the transaction. At the time of writing, gas prices were 25–30 gwei, and the set delegate action cost was around $3.00.

After completing these steps, refresh the page to view the delegate address, which will appear under the heading ‘Your delegation(s)’.

Removal of delegations is performed via the same page. Under the ‘Your delegation(s)’ section, the ‘×’ icon begins the process of removing your delegation from the previously assigned address. A new dialogue box will appear, asking you to confirm the delegation removal. Click the confirm button to proceed, and confirm the transaction via Metamask. At the time of writing, gas prices were 25–30 gwei, and the clear delegate action cost was around $2.00.

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The Bancor ecosystem is controlled by its DAO. Users who contribute BNT liquidity receive the vBNT token, which can be staked in a separate contract to participate in DAO operations via voting. Voting is an essential component in maintaining and developing the Bancor project. Managing the insurance whitelist, deciding on protocol co-investments, controlling liquidity incentives, and changing the organization of the DAO are all determined exclusively by community proposals and their voting outcomes.

The Bancor DAO is a superheavyweight. The rate of proposals received by the DAO is such that community members have, on average, less than a day to read and consider each one. For committed enthusiasts the burden is easy to manage; however, for some community members the process is prohibitively onerous and time consuming. Moreover, making an informed decision presupposes a level of erudition that some community members feel they do not possess.

Vote delegation allows community members to nominate other community members to vote on their behalf. Consider the following hypothetical. Alice and Bob have added 100 BNT each in liquidity to the protocol, and both have received 100 vBNT, which they stake in the governance contract. Alice is a diligent and highly-engaged community member, who actively participates in all governance decisions, whereas Bob is less so. Bob has a lot of respect for Alice and generally believes that their views are well-aligned. Therefore, Bob delegates his vote to Alice, which increases her voting power while offering Bob some relief from the governance process.

Importantly, Bob does not concede his vBNT; there are no transfers of tokens between Bob and Alice. Moreover, the process can be reversed at any time. If Alice begins to cease voting, or if Bob no longer agrees with how she votes, he can remove his delegation.

With the introduction of vote delegation, there are three main camps of governance participants:

  • Self-representation. These community members are happy reading the proposals in progress, and have a high level of understanding of the Bancor protocol, and its place in the DeFi ecosystem. They are confident in their ability to manage their responsibility to the DAO, and will likely continue to operate in much the same way as they were before the voting delegation was available.
  • Delegators. Community members such as Bob in the example above, are likely to want to delegate their vote to someone else.
  • Delegatees. Community members such as Alice, who are happy to shoulder the responsibility of remaining active in DAO decisions for the foreseeable future.

Delegators do not necessarily need the consent of their chosen representative before transferring their voting power to them. However, it is more conducive to healthy DAO operations to provide a means by which community members can announce their ambition to represent others in governance decisions, advertise their position on certain issues, and their voting philosophy in general. Such a platform allows DAO members to compare and choose their representatives in an informed manner, with the implicit consent of those to whom they may delegate their voting power.

To this end, a dedicated category has been created on the Bancor Discourse page. This category serves two purposes:

  1. Community members can announce their ambition to represent the voice of others in governance decisions.
  2. Community members can search for representatives to whom they may consider delegating their voting power.

There are no stringent rules for how DAO members choose to delegate their voting power, or how community members wish to express their political views and/or campaign for votes to be delegated to them. However, some helpful guidelines are presented here that aim to make the process as open and frictionless as possible.

This category is to serve as a platform for other community members to advertise their willingness to represent others in governance. The threads contained herein will feature DAO member-created material that opines on DAO operations, their personal voting philosophy, and general thoughts on various issues affecting the protocol. From this collection of self-nominated DAO volunteers, you will have access to a range of possible delegates with whom you can discuss your own views to determine the best fit.

It is recommended that you check the voting habits of your preferred delegate on a semi-regular basis. If you feel they are not representing your personal views, or have failed to participate in the majority of decisions, it may be worth seeking a new delegate to represent you.

This category is a useful platform to announce your willingness to shoulder the responsibility of representing the voice of others. There are no requirements to qualify as a delegate, save for your own self-nomination. Delegate authority is essentially automatic with the creation of a dedicated topic, and the posting of an Ethereum address or ENS domain to which votes should be delegated.

It is recommended that you maintain your thread regularly. Some inspiration for maintaining a healthy delegate thread is provided here:

  • Describe your general voting philosophy.
  • Be active in community discussion boards.
  • Announce ahead of time how you will vote on weekly proposals.
  • Be available to discuss governance issues on your own thread.
gov.bancor.network

Delegates cannot re-delegate the voting power assigned to them by others. Consider the example presented above. After Bob has delegated his votes to Alice, Alice decides to delegate her voting power to Charlie. Alice can only delegate the voting power associated with her own vBNT stake; the voting power assigned to her by Bob she will remain responsible for, until Bob changes his delegation. Therefore, it is important that delegates announce their withdrawal from DAO operations, and allow sufficient time for those who have assigned voting power to find a new representative.

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