Re-evaluating ApeCoin DAO Special Council Salaries Structure
Category: Process
ABSTRACT
This AIP proposes the re-evaluation of Special Council salaries from AIP-1 with an immediate salary adjustment for future Special Council members, suggesting a 50% reduction in their compensation (from $20,833 of ApeCoin/month to $10,417 of ApeCoin/month). This adjustment will be applicable to all future terms as detailed in AIP-137 and AIP-138, exclusively affecting Special Council members elected after the implementation of this proposal.
MOTIVATION
Since March 2022, the Special Council member positions have been established to fulfill the essential role of administering DAO proposals and aligning with the communityâs vision. The question of whether the compensation for this responsibility is justified remains a subject of community deliberation. I believe Itâs important to enable the community to reach a collective decision regarding this matter, recognizing that varying perspectives exist regarding the appropriateness of the compensation.
RATIONALE
Before we dive in hereâs the current structure of the ApeCoin DAO (Thanks @Vulkan for the image):
As Vera suggests, thereâs always room to write a proposal but also taking into consideration that the right compensation is necessary to attract and retain talent.
BENEFIT TO APECOIN ECOSYSTEM
Financially, the DAO stands to accrue savings of up to $104,165 ApeCoin monthly. It will also elevate community engagement by granting ApeCoin holders the opportunity to vote on this delicate matter, enhancing the overall governance.
SPECIFICATIONS
Special Council Members: Administering DAO proposals and aligning with the communityâs vision.
Administrators: WebSlinger, in charge of Finance, Legal, Operations, Compliance & Treasury.
STEPS TO IMPLEMENT
If the AIP passes, initiate a dialogue with the Administrators (WebSlinger), to implement and execute the proposed modifications to the salaries of the future Special Council members.
TIMELINE
If the AIP is approved, it shall come into effect as soon as possible.
OVERALL COST
$0. No costs for the ApeCoin DAO. Instead it will save the DAO up to $104,165 ApeCoin/month.
There was a lot of emotion, passion, heated debates etc. in AIP-277. But more importantly, it resulted in a very engaging discussion. If only we had that in the voting reform discussions.
In my opinion, I believe that the Special Council made a huge mistake by not bringing that AIP up to vote as was originally written. The DAO mandate - which admittedly created a paradox of sorts - clearly indicates this:
A Board member may be removed and replaced prior to the term pursuant to a majority vote of token holders.
If the DAO can vote to remove any Special Council member âprior to the termâ ending, so too can it vote to revise the salaries during said term. In both instances, contracts are clearly involved.
Regardless, nobody was advocating for the Ape Foundation to breach signed contracts, but since we have no clarity as to said contracts, we have no way of knowing what exactly the problem entails nor what breaches would have resulted if this AIP were to pass (as most expect that it would have).
For the record, I had personally said that the reduction of salaries just âbecause theyâre too highâ isnât a reasonable reason to do it.
That said, this is a DAO, and we have to abide by the rules - whether we like them or not. And if we donât like them, well, thatâs what AIPs are for. But what happens if the Ape Foundation flat-out rejects your AIP because it affected them? If nothing else, AIP-277 proved that was clearly untested waters. And so, here we are.
This topic is really a very important one however I think a salary review should come after a review of what is expected of the committee, time / hours / function etc and also the sorts of people you want to attract. Given the long term desire to make APE a powerful global token you need experienced strong indivduals at the helm, the current salaries could be deemed extremely low to attract talent but it then comes down. to what is expected and what is required. I feel a more comprehensive review should be taken. for example if large parts of the role perhaps are adminstrative in nature⌠would you down size the number of Special Councils but add people at lower price points who potentially are working to a different set of responsibilities. Its very easy to just cut salaries but with out context and what we are trying to achieve then its really only scratching the surface.
Thanks for the suggestion. I donât think changing the title really changes anything, the goal is for this AIP to go up to vote, then people can vote on whether they want to change the current salaries or not. Yes itâs a simple cut, still the structure will change. Maybe we could think about the structure and have a part of the salary paid fixed in ApeCoin (similar to what Ape Assembly is being paid) instead of dollars, whatâs your thoughts there?
Mind you, Iâm ok either way, as long as the community has the right to vote on it.
Thanks for joining the Discourse, glad to see you here participating for the first time!
Yeah⌠I think Special Councilâs job is not about expanding or making the token increase itâs value, itâs mostly just administrative work so whether the token does well or not I believe it wonât matter much to them. So the case of attracting talent with higher pay itâs a bit of a grey area here imo.
Thanks @SmartAPE! Yes this is coming after the Facilitators suggested me to publish the AIP again. Instead of just editing the AIP-277 to only affect future SC members and send it to vote, they said the process was to start over with a new AIP.
Yup. And I covered all of this in my synopsis (linked above) of the AIP-277 fiasco.
The issue here is that when the foundation set up the DAO, it basically had two high profile people (Alexis & Yat). And so, those salaries were set based on their caliber level. However, when the 2023 voting came around, those fixed salaries were retained irrespective of the candidates, their ability etc. It was basically the equivalent of promoting a VP to the position of CEO just because the board said so - and then not revising the compensation package accordingly. Or something like that.
AIP-1: Proposing the DAO - Process set the salary compensation back in Mar 2022 and it passed by a very wide margin during which 1438 wallets voted - most of them pretty large wallets because everyone was riding the $APE @ $14 (!) wave back in Mar 2022.
And yes - for an entity that once had a $1b (?) market CAP, they totally didnât care about pesky things like credentials, expertise, experience etc. And when you take into account the fact that the whole system is setup like a massive political enterprise, well, thatâs how all the Special Council and other high-profile elections end up being a massive fiasco which mimics political agendas that tend to be rife with lobbying, favoritism, corrupt intent etc.
Yet - all this time, nobody (?) thought - for one minute - that there was something very wrong here. Then AIP-277 happened, word got out into the wild, and the sh*t storm ensued.
During this time, here are the AIPs related to the Special Council that have since gone up.
And like the retconned AIP-277, that accountability AIP-305 has been in admin review limbo since Aug 9th - even as later AIPs have been created, gone to draft, admin review and up for vote.
Amid all this, below is todayâs performance metrics for $APE.
While the Ape Foundation wasnât created to (wink-wink) improve the value of the token, clearly in the real world if the share price of a corp was this bad, heads would be rolling. And as the token has no utility (not even Yugaâs own games are moving the needle to any meaningful degree), with such a restrictive voting system, it shouldnât be a surprise that the treasury is being drained while the DAO gains very little - if anything - of value.
As I said in my on-going outrage series (1, 2), âWhen thereâs zero consequence for failure, what incentive is there to succeed - at anything?â
In conclusion, the problems here arenât restricted to the salaries because, aside from the original Special Council, the new people didnât make the rules. So, hating on them for this isnât a good look.
The bigger issues here are related to the voting system as well as the fact that the Special Council has seemingly placed itself outside the rules of the DAO, and thus, can do basically whatever they want as thereâs zero recourse or consequence.
Below is an excerpt from the governance. Apparently the DAO community doesnât actually have the power that it assumed that it was granted.
âThis governance guide is an overview of the proposal process. Itâs a living document that will evolve and improve with the DAO communityâs input.â
So, the end result is that you canât revise salaries, you canât ask for accountability, you canât ask for DAO docs or anything that remotely addresses transparency. And you certainly canât fire anyone. For anything, youâd have to rely on the patently broken voting system whereby those with friends in high places and large wallets, get to decide. The end result is that you end up with the same churn of friends in rotation.
Thanks for the recap of what has happened and is going on. Hopefully things with time will change for the better, and people will start to think more about giving instead of just taking and caring about themselves.
The DAO is a non-prof and wasnât setup to improve the value of the token.
You canât tie a contractor (in this case, Special Council) income to the performance of the token.
You canât do #2 because of #1 and also because the earnings would automatically be considered an investment.
I donât think anyone is dumb enough to even agree to any such thing due to the fact that crypto tokens such as $APE are the most volatile. To wit: If the present SC had agreed to this, well, look at the price of $APE since they signed to now. Thereâs your answer.
I did not say it is tied to APE performance targets, it is simply given over a delayed time period. Btw I see this as only possible for future elections not passed signed contracts.
If they donât believe in APE, frankly they should consider if they should be on the SC.
It doesnât matter where the DAO is located because they arenât outside the reach of the US govt. Surely you know this?
The Special Council members being US citizens or residing in countries within the jurisdiction of the US govt. presents a conundrum in and of itself because token holdings still need to be reported - and taxed.
The main issue here is that being paid in $APE and then being asked to vest that, is in fact an investment because the token, by the very nature of its initial ICO, is an investment vehicle. Just like shares.
And being asked to âholdâ part of your pay in a vested vehicle is no different from being paid in vested shares which are also investment vehicles.
Why would they have to âbelieve in $APEâ when in fact theyâre not mandated to do anything that improves the performance? I mean, itâs about value. I am pretty sure that if I were being paid $20K per month, then asked to accept some it as vested vehicle, that means I am incentivized to improve the value of the token in order for it to have value. The SC isnât mandated to do that because itâs a non-prof. I mean, why didnât the original founders think of that back when $APE was trading at $14? They didnât believe in it back then?
For all intent and purposs, itâs an investment token. It was the whole purpose of the ICO. Calling it something else doesnât change this material fact.
An Ape Foundation subcommittee will also serve as ApeCoin DAOâs âboard,â which will oversee certain proposals. The initial board consists of five high-profile crypto investors: Reddit co-founder Alexis Ohanian; Amy Wu, who leads the crypto exchange FTXâs venture arm; Maaria Bajwa, of Sound Ventures; Animoca Brandsâ Yat Siu; and Dean Steinbeck of Horizen Labs. Each board member gets a six-month term, and the ApeCoin website promises DAO members will be able to vote on future members.
Floating somewhere in the middle of all this is a Cayman Islands-based consulting company called Cartan Group, which is being paid $150,000 per month for a six-month contract; all five of the DAOâs active AIPs, or âApe Improvement Proposals,â were posted by Brian Tang, the companyâs co-founder.
People seem to forget we are now solely elevating community members, they have no special qualifications, educations or backgrounds that make them perfect for the role.
Treasury is now down from a multi-billion dollar fund to barely $500m once fully diluted in three years; so for us to continue to give quarter of a million dollars ($250,000) to each member is pretty OTT imo and short sighted.
Other points to note - SC members can (and most will without doubt) use the title âex-special council memberâ for the rest of their lives, and good luck to them, but should this also not be costed in - the doors that the role opens for them now and in the future?
Last point and Iâll stop before it seems like a rant (and no I wonât talk on the $ape price subject and SC), the role of Special Council should be seen as a vocation. Those who are applying should feel a certain âcallingâ imho, so lower grants will encourage this more and have zero impact on those who apply for the SC role in the future. (Especially as we are now creating specialised working groups where we can pay larger grants to people with real proven experience and knowledge in their respective fields, if they join, and if we decided to etc etc.)
GL with this. Although Turkeys and Christmas spring to mind - just saying.
This is a flawed opinion; also a carefully constructed narrative being pushed by certain Special Council members, and Iâll explain why:
Any half decent investor will do their research/due diligence before parting with any money; as 47% of $ape goes to the DAO then naturally one would look at those who control its direction. When they look at these people below, truth be told, they are simply not being filled with confidence, and this ofc rightly reflects in the price of $ape at present.
Tbh I could give many more examples and reasons but thereâs really no point - we can agree to disagree respectfully for sure.
Hey SmartAPE
Thanks for your reply. Thought provoking. My points were conversation starters rather than a definitive opinion. I am treating your feedback in the same way and so a couple of further thoughts:
Totally agree the DAO is a not for profit and grants organisation and isnât setup to improve the value of the token. As I understand it and admittedly my understanding is vague the special council is not the DAO it oversees the Foundation. The Foundationâs goal is to steward the growth and development of the APE ecosystem in a fair and inclusive way. Growth of the ecosystem should translate to improved utility and potentially but not necessarily value
Why? Is that US employment law?
I am not a tax expert so your point is interesting. I would have thought this wasnât automatic rather a jurisdictional decision at the level of whether or not it is or isnât an investment after that it would become a personal tax issue
I would argue they should be running for the council if they werenât willing to take similar risks that DAO members accept for their participation and efforts to grow the ecosystem
