The Dash decentralized autonomous organization (DAO) has run into funding limits, forcing a reprioritization of projects and an increase in efficiency.
Originally formed to assist in development funding, the Dash treasury system allows the masternode network to vote on funding proposals to claim the 10% of new coins created set aside for the treasury. Initially, funding development occupied most of this function, with the occasional small community project acquiring funding as well. During 2017, however, the treasury’s capacity to fund projects grew exponentially along with the increase in Dash’s price, resulting in a surge of projects funded by the network, which this year has hit limitations of the treasury’s current ability to fund projects.
Late 2017 “time of plenty” and Core growing pains made 2018 reallocation necessary
Current reforms to the treasury distribution come after a frenetic year of rapid expansion. The Dash network experienced a sharp increase in valuation during 2017, with the price rising from about $10 at the beginning of the year to around $1,600 in December. The resulting price surge gave the treasury a significantly larger budget to play with, up to $10 million monthly by the end of the year. As a result, a significant budget surplus developed each month, with significant promotional proposals, such as sponsoring top-level MMA fighters and multiple TV shows and documentaries, coming in to take up the remaining available funding. At present funding levels of around $2 million every month, that represents $8 million less than what was available at the end of last year, and as a result many high-level promotional proposals have tapered off.
Additionally, the Core team experienced significant growing pains with the price surge, compounded by founder Evan Duffield leaving to form Dash Labs and turning over Core to Ryan Taylor as the new CEO, as well as business development head Daniel Diaz leaving unexpectedly. Since then, Dash Core has hired dozens and filled several new management positions, including CTO, CEO, CMO, and head of Business Development, significantly increasing the team’s ability to scale and take on larger responsibilities. The resulting expansion towards the end of 2017 and the beginning of 2018 created a larger and more powerful Core team, finally catching up to the increase in valuation last year.
Various tools and improvements help streamline the DAO to do much more with less
To further aid the development of the Dash DAO into an efficient ecosystem, several improvements have been created to eliminate waste, increase accountability, and help the network to scale. In order to minimize instances of projects simply going dark after funded, or failing to remain fully accountable to the community, the treasury has funded Dash Watch, an organization dedicated to tracking all past proposals and cataloging their progress. Additionally, Dash Force writes the occasional in-depth investigative report when necessary, for cases where a more aggressive approach is warranted.
DashBoost created a micro-treasury system to help smaller projects get funding and attention while sparing masternodes from having to review dozens of proposals each month (though the project is currently solving its funding source). Dash Core has clarified its guidelines for providing escrow services to the network, and several other projects, such as Dash Force, provide similar services in a limited capacity.
Finally, several ecosystem improvements are on the way later this year. Dash Core announced the pending creation of Dash Ventures, an entity that would allow the Dash masternode network to legally own a stake in companies that it funds. Additionally, the upcoming 12.4 release will include deterministic masternode lists, which will allow masternode keys to be split into three separate keys, one for collateral, one for operations, and one for voting. The separation of a specific voting key will allow for masternodes to delegate voting rights, meaning that some masternode owners may feel less burdened to participate in the voting system entirely on their own, and will instead trust other professionals to do proper due diligence in evaluating and voting on treasury funding.