I like this proposal a lot in theory, though I haven’t verified the signatures myself, and I see a problem with it.
A big issue with this proposal is that it assumes that the address that sent the fundraiser tokens are the intended owners of these atoms. This is not always the case, and because of this, this proposal can be the source of theft of ATOMs.
For example, for any user who sent Bitcoins from an exchange (custodian of donation source Bitcoins or Ether) would be vulnerable to getting their ATOMs stolen by the exchange operators. Nothing in the terms of the fundraiser prevents this scenario from happening, so we should assume that for some portion of account holders, those who can sign from donation Bitcoin/Ethereum addresses are NOT the rightful owners of the ATOMs.
Given this, you can’t determine the rightful owner just by looking at the Bitcoin/Ethereum/CosmosHub chains. The Cosmos Hub wants (and is designed to accommodate) a significant portion of atoms (around 1/3) to be unbonded, and so they are. They pay the inflation tax, but the whitepaper defined the bounds on inflation (to be 20% a year). And, many ATOM holders don’t want to participate in delegation, and some perhaps just don’t want to delegate yet. Once staked, the expectation is for the ATOM stakers to participate actively, and to accommodate community-scale timelines balanced with responsiveness, we set the voting period to be short, just a couple of weeks. But we haven’t defined the expectations for non-staked ATOM holders. So I would bet that many genesis accounts haven’t moved their ATOMs yet.
The combination of the above two points is dangerous, as there are probably many ATOM holders who have chosen to stay passive, aren’t aware of this proposal and the claims made in them, and have contributed from Bitcoin or Ethereum addresses that were operated by someone else.
In the blockchain space, if there is opportunity to steal, people will take advantage of it. There probably exists a pool of genesis fundraisers who haven’t moved their ATOMs yet, willingly. With the passage of this proposal, this creates the opportunity for anyone who operated the source Bitcoin/Ethereum addresses to steal ATOMs from their rightful owners. Ergo, it will probably happen.
On the other hand, I like the idea of the Cosmos Hub being able to make amends in this kind of way. For the cases that this proposal is trying to target, we need to do the following:
- Give more time for rightful ATOM holders to disprove the claim (e.g. prove that someone is trying to take their ATOMs).
- Define this duration of time to be the “passive ATOM participation period”, the period of time under which even passive ATOM holders are expected to participate. This should be long, it could even be a year long. The longer it is, the more convenient it is for passive ATOM holders, which is overall better for ATOM holders. As a passive ATOM holder, you are liable to lose your ATOMs if you don’t keep up with assignments made to passive ATOM holders as agreed on by governance. This might sound extreme to some, but my point is that this is what we are agreeing to if we pass any proposal that recovers ATOMs from fundraiser contribution BTC/ETH addresses.
- I don’t think it’s a good idea to set precedent that you need to participate within the year, that otherwise your ATOMs may be gone. What if you get disabled or incarcerated? The period for requiring participation of passive ATOM holders with threat of ATOM tokens being stolen, should be exceptionally long, like a year or longer. For this case of fundraiser participants, because the number of participants is small, I think a year would be fine, esp considering that passive ATOM holders weren’t notified beforehand about the unexpected proof-of-ownership requirement.
- The period could be shorter for other types of proposals… for example, any one-off proposals that inflate the total ATOM supply (e.g. in connection with say a merger process) under some threshold like 15% above and beyond the baseline inflation schedule, might only require 3 months to be deliberated by the non-staked ATOM holders. I would propose that this period be 1 quarter (3 months) for such proposals that make exceptional modifications to the distribution of ATOMs. This is similar to how board meetings take place quarterly to approve of adjustments to share allotments.
Unfortunately there are now 5 days left to vote. Even if this proposal passes, we can still pass a proposal that addresses the points mentioned here, but it’s better to not pass faulty proposals in the first place. AIB could vote no and it would, but we are unbonding our atoms ATM. The next logical step is to propose an amendment to this proposal as mentioned here or similar to prevent theft.
I’m interested to see if we can change the vote within the next 5 days, but either way, AIB will very likely submit an amendment to #29 soon. If you read this and agree, and you have already voted, please vote no, and stay tuned for more discussions for the amended proposal. If you haven’t voted yet, it’s probably best not to vote, because it doesn’t have quorum to pass yet.
p.s. The forum.cosmos.network is “official”, but there had so far been no requirement that proposals be submitted there for discussion. I haven’t been checking all of the posts there, and I imagine most people don’t. Maybe we ought to pass a proposal to designate a forum where discussion is expected to happen after a deposit minimum is reached, but before voting starts. NOTE: The deposit requirement for proposals was implemented as a spam prevention mechanism, so it makes sense to require general discussion after the deposit threshold has been reached, not before.
p.p.s. I’m in favor of well crafted non-immutability of the Cosmos Hub, but only if we adopt strict measures to prevent theft and undesirable inflation. Along with the amendment to #29, or in parallel in a separate proposal, we should formalize the procedure for governance. For example, whenever the ownership of tokens or the restriction of access to them or the inflation of new tokens is considered, we could require additional steps before such a proposal is passed. The period for voting could be lengthened for such proposals to match the passive ATOM participation period as mentioned above, and there could be a designated set of reviewers that are required to submit an analysis of the proposal for correctness and security such that more information can be made available to voters before the vote happens.
p.p.p.s. Cosmos governance is currently a bit flawed in that sometimes it’s better to NOT vote for a proposal than to vote NO, if the proposal is under the quorum (as it is in this case, currently at 17%, under the necessary 40% quorum). One way to solve this issue is to require the 2 week voting period to start after the quorum has been reached.