Decentralizing Paladin - The path onwards

Dear community,

As PAL becomes available on the markets, it is extremely important that we keep pushing towards decentralized operations for the protocol and DAO in general.

As a core team we have done our utmost to respect decentralization while minimizing risks due to the infancy of our community.

There are currently 3 stages of decentralization we should strive to achieve this year;

  1. Community Treasury Management
  2. Operational Sustainability
  3. Parameters Management

Let’s go step by step through what each of these entail and how we propose to implement them

Community Treasury Management

The DAO controls over 60% of the supply of PAL, this multi-million dollar stack of governance tokens is our lifeline for future product development with a 10+ year outlook. We have to be responsible in the way we use it, to avoid diluting current holders too fast and keeping major firepower for Phase 2 & 3 of Paladin.

However the treasury doesn’t only represent $PAL. After the LBP the DAO owns 2.4M$ PAL-ETH and PAL-USDC LPs on Curve and Balancer and will accumualte all the protocol revenue before the Chest is live.

We want to separate the management yield bearing Treasury and the $PAL treasury.

The $PAL treasury will only be allocated for operational purposes and emissions to bootstrap pools through hard governance (PGP). The funds are currently in the Core team multisig and should be moved as soon as possible in a more trustless solution (in a community multisig before in smart contracts when on-chain governance is enabled). The elaboration of the Community multisig will be introduced in PGP-8: Community Multisig Election.

For the yield bearing treasury (LPs + other afterwards), we should have a specialized committee dedicated to managing them to maximize yield output for the DAO. This will be explored more thoroughly in PGP 9.1: Treasury Management Committee.

For the sake of transparency we will also publish what was spent in the name of the DAO up until now so community members can understand what was deployed to bootstrap the DAO (see PGP 9: DAO Spendings)

Operational Sustainability

Paladin is growing in strides and the core either has to triple in size or the DAO needs to take ownership of the products. In the spirit of decentralization we believe the latter is a necessary step.

Currently the protocol has four necessary groups:

  • Treasury Management - which will have the heavy duty of maximizing revenues with protocol assets to create a base yield for the Chest. ( see PGP 8.1: Treasury Management Committee).
  • Business Development - It has become obvious that vote lending is a business catalyzed by constant market canvassing. This is very time consuming, and we don’t believe the core team should dedicate as much resources as is needed on this. The goal will be to create a guild rewarding whitelisted contributors who bring in loans and Quests to the DAO (see PGP8.2: BD Working Group).
  • Content Creation is the bread and butter of any protocol. We have been extremely impressed by the creativity of our community and believe we should introduce a standardized way of rewarding them (see PGP8.3: Creative Guild).
  • Development: Creating new dapps and maintaining already existing ones. We don’t feel ready to start giving up control on this as we still have a LOT to dish out and want to take our time and do this right, which no protocol has found how to do yet.

Parameters management

Now this is the big one folks. Handing over smart contracts means the community needs to be autonomous and contributors involved enough to be reactive. We are not there yet and need to prove more resiliency before parameters management is led by a community multisig. Let’s try and make this happen in the next nine months.

Lots to do folks !

PGPs will be added progressively during the week and linked to this post


Another aspect that I wanted to mention, is about voting structure. This is a key topic the whole decentralization process cannot be complete without on-chain governance.

I don’t believe token holders should over-burdenned by a daily / weekly stream of proposals. Instead we should have them directly decide only on strategic decisions.

From now on proposals will essentially be about:

  • Budget
  • Election of representatives
  • Strategical Acquisitions
  • Exceptional decisions

Most other decisions will be taken by elected or nominated operators on a daily basis. A monthly or quarterly report will be delivered to the community so they can evaluate their performance and renew their support for the operator.

In case of a spending / action outside of their pre-defined scope, operators will be able to create an optimistic governance proposal.

Any proposal going against the Constitution (currently being reworked after @Roald 's proposal) will be canceled by the Community multisig.


Sounds like recreating traditional voting structures lol.

But there are two major differences: transparency and democratization of power.

Voter fatigue, whether out of actual fatigue or apathy, is very real.

Regardless, I have seen Paladin continuously reach quorum on the last 4 to 5 recent votes so I would love to hear feedback from others before making a decision on this.


This is something we see across a myriad of protocols - independent of product and size.

One way to combat apathy is through simplicity - I believe it is important to understand these four core metrics while also keeping proposals lean, informative, and easily digestible.

We entrust Paladin core and elected members with key decisions and advocate for continued transparency while building the future of the DAO.


It’s probably a good thing to bump up this post for more visibility following the contributor’s call last week. So this covers the expectations from the different guilds? Are those PGPs 8.1 to 8.3 already created?


They’re drafted up. Just making a few tweaks.


Hey team
Really appreciate the fact that you’re taking decentralization at heart and the way you’re doing it smoothly. I’m looking forward to PGP 8.1 to 8.3 to push the DAO’s level further !

Some questions though :
How the DAO keeps control over the various committees ? Is there a mandate for the elected or possibility to get rid of a member ?

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Could you specify your questions further?

On how the DAO keeps control over committees: Budgets and ideally quarterly audits on productivity with inter-order calls every two weeks (will replace contributor calls).

Mandate? Order leaders and members must not miss more than five consecutive votes. If they do, they get ejected from their respective positions.

But none of this is final until voted on.

I was answering because as is stated, it seems elected members could keep their roles forever. I don’t know if it’s desirable.

Ok with budgets and audits (btw it seems like a consequent work, I assume this will be paid ?) but how is made a “judgement” about it. If it’s good, fine, but if not ?


Proposals 8.1-8.3 will begin to have this fleshed out and of course more discussion can be held in the respective threads when they’re up.

No. Elected members will not have the roles forever. It may differ order to order (depending on how it is structured) but ideally terms will be one year or less.

On how creation and submission of budgets & audits are compensated for remains TBA atm. That’s the tricky DAO part and this is where human cooperation comes into play lol. Whether it’s good or not is subjective. One way of measuring progress is by establishing quarterly goals and creating objectives.

Regardless, those decisions soon won’t be the core team’s to make. As decentralization continues, we want to gradually play less and less of a role as decision makers.


Elected members have a madante lasting between 3 month and a year. And they can be unseated by a full governance motion.

We’re not happy with the current drafts so are re-working them. First one to be published will be the Marketing Order as we’re quite close from something sensible. Then BD (need a few weeks) and then Treasury.


Thanks for clarifications ! Does the same mandate apply to multisig members ? Because there’s no mention about this in the dedicated thread

And I assume Marketing is “Creative guild” ?


Yes, I will add the details, but multisig members are there until they either quit or are off-boarded


Yes, marketing is a part of the “Creative Guild”. If the DAO feels it should be separated we can discuss it here or in the PGP thread respective to that guild.

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I have the feeling that we should start with the marketing as part of the creative guild and then based on the progress separate further at a later point of time.

This would also proof that we can elect new members after let’s say 3-6 months and decentralize further. But I will comment on the PGP.


100% agree with you. Best to keep the process simple at first and adjust if needed as time goes by.