Voting Power

The GrantShares DAO is permissioned. While GrantShares is designed such that anyone can create proposals and take part in the discussion on proposals, currently only a subset of all users can take part in voting. Voting rights cannot be bought, there is no token involved in membership, and the initial members are chosen by Neo Foundation. There is no direct financial incentive for the members. The member's main incentive is the growth of the Neo ecosystem. This can lead can lead to financial gain indirectly, because with Neo's growth Neo based tokens might gain in value. Though, not only GrantShares members can profit from that. All in all, the goal was to give the voting power to a group of which we know that they have skin in the game. The game being Neo and its growth.

Membership can be gained through a proposal. Thus, new members will be added if the existing members and the community - through the open proposal discussion - deem them to be a good fit. Existing members can be removed if they want to step back or are seen as a threat or hinderance to the decision process.

A token-based membership model seemed inappropriate for this kind of DAO. Having a tradable token give voting rights to the owner introduces new mechanisms that have to be considered. What valuation should the token have in the beginning? Does a whalte that can afford a lot of DAO tokens have the right incentives to fund the most valubable projects. How can we connect the outcome of funded projects to the token value? A more reasonable mechanism would be based on the NEO token instead of a new token. At least then there is that indirect financial incentive already mentioned above. NEO owners should be inventiviced to vote on those proposal that bring most value to the ecosystem thereby promising an increase of the NEO price. The problem with that approach is its complexity. Snapshots of NEO balances at certain points in time have to be stored in the DAOs contracts in order to prevent "double-voting attacks". In the end, we decided to start out with a simpler model. Once the project has taken a foothold in the wild it can evolve. Afterall, the GrantShares contracts can always be update through a proposal.