Introducing ParaDAO

ParaDAO provides tools for communities with the same passion / shared interests to come together to organise amongst themselves to achieve a common goal. The decentralised application that allows communities to create a DAO easily with out of the box governance models for managing:

  • DAO treasury (moving of funds to certain purposes: host an event (offchain), staking / swapping (onchain))
  • DAO details (Updating some onchain /decentralised storage data of the DAO)
  • Proxy execution ( Enable the DAO to take part in other DApps, for example joining / voting in another DAO )
  • Oracle for prediction market creation and referee

ParaDAO is not only a tool, it in itself is a DAO and members are the DAOs created. This ensures that ParaDAO continues to provide useful features to support the community.

Discover our features relating to:

Components (Current)

  • A parachain node with the pallet-contract to host the set of smart contracts for DAO creation
  • A relay chain node to simulate communications with the Relay Chain and other parachains
  • A frontend to allow users to create DAOs easily, allow DAO members to do proposals, votes, and integration with the Zeitgeist SDK
  • Managed IPFS node for storing metadata for DAOs and Prediction Market information in Proposals

Why Ink!

We have use Ink! because it was important for this set of tools to be easily deployable on different parachains.

ParaDao is a tool to allow people to collaborate in the most convenient way, and would like to be available for any chain that supports the substrate's smart contracts.

Inspiration

This project is heavily inspired by many project that have been very well thought out. We adapted our own twists as a PoC for the hackathon but we would like to credit:

  • daodao.zone
  • daohaus.club
  • xdao.app

Try it out!

  1. Please fund yourself with paradao parachain tokens (to create, join, propose and vote) with wss:://paradao.space/paradao
  2. Also fund youself with Zeitgeist dev tokens (to create prediction market and buy OST) with wss://paradao.space/zg
  3. Head over to paradao.space 🚀

Note: the Paradao Parachain has a block time of 12 seconds, please be patient

Note: if you made the proposal, your vote has been counted and you cannot use the same account to vote again

Contribution based Voting Power

One of the benefits of having a DAO is to distribute decision making. In many cases, each member of the DAO has voting power depending on the amount of governance tokens they have.

This makes sense in many cases as they have more "skin in the game".

In some cases, however, DAO may want to have voting power reflecting the contribution done by the individual. This contribution allows the "promotion" of individuals into different roles which maps to different voting power.

As we move towards decentralised identity solutions with verifiable credentials that can be tied to onchain accounts, and projects that provide identity aggregation services, it becomes easier to prevent Sybil attack on DAO voting that is based on contribution. I.e. someone cannot just use many accounts to gain the same amount of voting power as someone who has contributed).

Prediction Market for DAOs

By providing variety of voting power calculation mechanisms does not automatically increase engagement, ensure a great voting turnout, or cover all decisions that needs to be made by DAOs.

ParaDAO leverages prediction markets to encourage participation in different forms.

Voting

To encourage voting, a Prediction Market overlaying proposals can improve the incentives for members to engage.

For example, let's say there are 2 active proposals for funding from the treasury with the purpose of increasing DAO treasury,

  1. social media advertisement to increase members,
  2. provide liquidity with tokens in the DAO treasury,

The DAO can create a prediction market which has the same market opening times as the proposals with the question,

"Which strategy will likely bring the most revenue to the DAO treasury in 3 months?"

The Outcome Asset Tokens will then be Strategy1, Strategy2, None.

A DAO member may decide to purchase Strategy2, believing that it will work to a certain degree. They would then vote yes to fund that proposal and no to not fund the other one.

Similarly, if a member do not believe any of them will work, they can purchase the None OAT and vote no to all two proposals.

The earlier the members or even non-members enter the prediction market, the more they are rewarded compare to late comers. They would also want to vote on the proposal to ensure their options will be Passsed.

Content promotion

For example in the case of a Fanclub, there can be prediction market created by the star / members on content, i.e. "The new music video released in June 2022 has been shared more times than the one released in Jan 2022 by 31st Aug, 2022".

In this case, people might choose to purchase the Outcome Asset Tokens that align with which video they like more, it may also be the case that they help share the content to promote its circulation.

Community types

ParaDAO initially has default options that are designed to support 2 types of DAOs

Fanclub

Inspired by Patreon / Substack, individuals who produces valuable contents may be supported by a community / fan base through a DAO.

In this case, the DAO roles will only be the Star(s) (content producers) and the supporters, where the supporters can participate in some polls / suggestion and the Star(s) will have full control over the DAO treasury.

Collab

Inspired by meetup.com, a group of individuals may want to contribute to say a software code base, a meetup events etc. Some members of the DAO should be rewarded for their contributions, and some other members may just be users of a software or participants of an event.

In this case, the DAO will have a selection of roles of which the users in each role may be able to vote / execute subset of actions only. It is also likely in this case that the treasury is managed by proposals and votes.

3. Customisable (Coming Soon)

We want to provide user with a way to design their DAOs, the permissions and governance models.

Support with Staking

Coming Soon

Support by staking

In addition to direct donation to a DAO, user might want to dedicate their staking rewards to a DAO instead.

For example, Alice transfer DOTs from the relay chain to a parachain and joins a DAO, specifying that she wants to stake it.

The DAO can then stake the tokens back on the relay chain and when Alice wants her DOTs back, the DAO unstakes and return to Alice when she provided, keeping the staking rewards.

ParaDAO reward tokens

ParaDAO will integrate with a ERC20 token (with snapshots) that rewards DAOs who vote on ParaDAO proposals. These rewards will be transferred to the DAO treasuries.

Future Work

Improvments

DAO Roles

Currently there are only 3 types of roles, ideally roles should be created when creating the DAO. Each role should map to specific permission(s) applicable. These permissions should also be flexible and members can vote to change them.

Proposal

Proposal should have different expiration, threshold

Voting

Staked tokens should contribute to the voter's weight, there should be a snapshot for the weight of the votes at time of proposal

Zeitgeist

We had spent significant about of time to try to connect ZG parachain to the relay chain in order to directly create Prediction Market with XCM.

This was the steps we had researched, but were only able to get to Step 2.5 (Able to finalize 1 block)

  1. add zg docker to docker-compose
  2. register on relay chain
  3. zg produce blocks
  4. zg <> paradao channel
  5. add xcm-pallet to paraao chain to call zg to create PM, example
  6. add the xcm-pallet to the paradao chain runtime + test
  7. add extension (a function and add it to the contract-pallet config in the runtime) to paradao chain to extend contract to call the xcm-pallet in step 5, example