Minswap Catalyst Improvement Proposal
Please be advised that this enhancement represents an independent initiative, designed to complement the existing catalyst review framework. It is not intended to serve as a replacement, nor does it alter the current process of selecting 50 proposals for consideration by the Minswap DAO.
Background
Minswap Labs currently implements a strategy wherein a committee appointed by the DAO meticulously reviews thousands of proposals to identify 50 of the highest quality ones. Despite the diligent efforts of this committee to select the most meritorious proposals, it has been observed that some proposals favored by the community or those from long standing Minswap partners occasionally do not reach the final list presented for voting by MIN holders.
It has been noticed that there is a lot of room for Minswap to enhance its utilization of Catalyst votes. This proposal involves allocating Catalyst Proposals for voting based on their level of support within the community, as well as metrics related to Minswap, such as Total Value Locked and trading volumes.
Aim
Minswap’s current position is largely attributable to the substantial support it has received from its community and from projects that have enhanced the protocol by contributing liquidity to Minswap’s liquidity pools. Consequently, this proposal seeks to fortify these relationships by introducing an innovative method for inclusion in the Minswap Catalyst Voting list, while preserving the ultimate decision-making authority of MIN holders in governance matters.
Scope of Change
By voting affirmatively, the DAO will:
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Increase the range of proposals filtered and presented to the DAO to between 50 and 65 (50 from the original process and up to 15 from this initiative).
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Enable voters to select 30 proposals, an increase from the current 20.
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Approve the compensation package outlined below to remunerate volunteers for their contributions to any given fund.
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Implement this mechanism for Fund 12 and all subsequent funds.
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Authorize the Catalyst Review Committee to add members for future funds and appoint replacement volunteers should current members opt to withdraw or take a hiatus for a fund.
Solution
This solution is designed to address two key issues:
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Projects that have supported Minswap will have a fair opportunity to be included on the list.
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Proposals highly favored by the broader Cardano community will also gain the opportunity for inclusion on the list.
The objective is to designate an additional 15 slots on the voting list to accommodate this. It is important to note that these slots may not always be filled; they are intended to provide flexibility to include more projects as needed. Generally, most projects are already incorporated into the initial list of 50 by the screening committee.
This arrangement effectively allows for between 50 to 65 proposals to appear on the final voting list. To accommodate this increase in proposals, the number of votes each participant can cast and which the Minswap DAO will be voting for will be raised from 20 to 30.
It is important to note, however, that the majority of the time, if a project or community engages with the Minswap Discord and presents a compelling argument for their proposal which fits the criteria for Proposal selection (which is explained here (insert link to the Catalyst Reports), the committee has consistently integrated these proposals into the final list. This solution is intended to accommodate any exceptional cases that do not make it onto the final list despite these efforts.
Slot Selection Method
This solution can be broken down into 3 components.
Engagement Contest
Please be advised that in this context, the term “originator” refers to any entity, organization, community, or individual responsible for creating a proposal.
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Minswap Labs will launch a promotional tweet to initiate this program, which will be active for 7 days from the time of posting. After this duration, snapshots will be taken of all metrics on Twitter and the initiative will conclude.
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Participants (anyone with a Catalyst Proposal) are required to quote this initial tweet and must compose a thread detailing their catalyst proposal. It is important to note that only the originators of the proposal are authorized to take this action. Quoting the tweet for a proposal not authored by you will result in exclusion from the count; only quotes from the originator’s Twitter account will be considered valid.
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Proposees are then encouraged to spend the following 7 days mobilizing their supporters to interact with their quote, aiming to maximize exposure and generate substantial attention.
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Each proposal originator is limited to submitting no more than two proposals. This should be done with one separate quote tweet per proposal.
Data Analytics
An on chain snapshot and Twitter post analytics will be used to assess these criteria. These snapshots will be taken after the 7 day period from when Minswap Labs posts the engagement tweet. The snapshots of all quotes that adhered to the specified guidelines and were evaluated will be compiled into a PDF document and released to the public. This document will include a picture of the assessed quote metrics, the final score, and a link to the quoted tweet.
Considering that Minswap operates as a Decentralized Exchange, the quantitative strength of its partnerships primarily hinges on Total Value Locked and trading Volume. On the qualitative side, the value of a partnership is influenced by the level of influence and engagement on social media platforms.
Engagement Weightage
It’s important to recognize that different types of interactions—such as likes, comments, and reposts—vary in influence and should be evaluated accordingly. To accurately reflect these sentiments, a weighted average formula has been developed to score each project’s proposal.
Likes were allotted a weight of 60%, as each account is limited to one like per post, thereby serving as a measure of organic engagement. Retweets/quotes were allocated 30% weight, as they are visible to all followers of the retweeter, but unlike likes, there is no cap on the number of times an account can quote a post. Comments were assigned 10% weight, considering the ease with which an account can leave multiple comments on the same post.
Overall Weightage
It was acknowledged that some proposals, while potentially beneficial to the broader Cardano community, might not have a corresponding token, thus lacking Total Value Locked and Volume on Minswap. Consequently, the following weights were established in the assessment formula:
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Engagement was assigned a weight of 50% to enable community favorites without a token to be considered, emphasizing the value of community feedback through engagement.
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Total Value Locked on Minswap was allocated 30% to express our gratitude towards projects that have placed their liquidity with us.
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Cumulative Volume received a weight of 20%, recognizing that while exchange volumes are indicative of DEX success, they are not within the direct control of the projects. Therefore, an additional 10% weight was given to TVL to acknowledge active participation.
Please note that the cumulative trading volume since inception on Minswap will be considered to assign significance to the duration of the partnership. This approach ensures that longstanding collaborations are appropriately valued alongside more recent activity.
Final Formula
Please note that if a proposal already included in the catalyst review process also secures an additional slot, it will be ineligible for this extra slot. In such cases, the subsequent proposal on the list will be selected after evaluating all final scores.
Volunteers tasked with applying the formula must leverage their expertise to accurately assign total value locked and volume figures to proposals based on the originating account. While occasional edge cases may arise, volunteers, all seasoned members of the DAO and appointed by either the DAO or The Catalyst Review Committee, are entrusted to exercise informed judgment in resolving such instances. Their alignment with the protocol’s best interests ensures diligent handling of any outliers encountered.
All calculations will be done using this spreadsheet.
Bot Activity Mitigation
An inevitable question arises: “How can we prevent bots from influencing the engagement system?” While it’s challenging to completely eradicate bot interference, effective mitigation strategies are within reach. Our approach addresses this concern through a multifaceted formula designed to counter bot activity in three distinct ways.
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The formula assigns a 50% weight to the engagement component of the contest, representing the maximum theoretical score attainable for a post inundated with bots. To further safeguard against manipulation, engagement actions are categorized, each with varying degrees of susceptibility to bot influence.
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Recognizing comments as particularly vulnerable to bot activity, they are afforded the least weight at 10%. Quotes, while not constrained by a cap, inherently generate more views and thus command a slightly higher weightage at 30%. Likes, limited to one per post per account, carry the highest weightage at 60%. While not impervious to bot manipulation, this weighting structure significantly raises the bar for such activity.
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Crucially, the formula normalizes post activity by factoring in the total engagement across all posts. For instance, if ten accounts each receive twenty bot-generated likes, totaling an extra 200 likes beyond organic engagement, this surplus is integrated into the denominator of the formula. Consequently, the final calculation maintains equilibrium, effectively counterbalancing the impact of bots.
Education Initiative
The final step in this process will involve publishing a Twitter thread, a Medium article and/or Twitter Space(s) that showcases all the proposals awarded a partner project slot. These publications will:
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Provide brief descriptions of each proposal and emphasize the originator’s beneficial partnership with Minswap (if applicable) and their contributions to the Cardano ecosystem (if applicable).
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Highlight significant contributions such as the total value locked and cumulative trading volume on the DEX (if applicable).
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Publications will highlight the advantages realized by projects through their engagement with Minswap (if applicable).
Benefits of the Initiative
This additional catalyst initiative may appear complex or unnecessary to some. It’s crucial to reflect on the original motivations behind this initiative. Minswap’s current process for selecting proposals has received positive feedback from across the Cardano community, with protocols such as Liqwid DAO even replicating it. This proposal introduces a layer that enhances the community input in the Catalyst Proposal selection method, letting projects compete for a vote by rallying their communities behind them.
The cryptocurrency industry moves rapidly, and the ability to adapt is essential for maintaining a competitive edge. For instance, Minswap was once the leader in TVL for the Snek/Ada pair, but with the advent of new Cardano DEXs and their variable fee structures, some liquidity has shifted away from Minswap. This example underscores the dynamic nature of the ecosystem and highlights Minswap’s commitment to incorporating community feedback and fostering strong relationships with projects, individuals, and the DAO, ensuring Minswap’s enduring success as the premier DEX on Cardano.
This additional mechanism will provide several advantages for the Minswap DAO and its community:
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Community Responsiveness: It demonstrates our commitment to addressing the concerns raised by the community and partner projects fairly, while preserving the voting authority of MIN holders, who ultimately decide the outcome.
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Marketing and Education: The educational aspect of this initiative, coupled with increased social media engagement, will serve as valuable marketing for both Minswap and various proposals within the Cardano ecosystem, potentially increasing traction.
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Inclusivity for Partners: Long-standing partner projects will benefit from an alternative route to feature on the vote list, especially if they are overlooked by the catalyst review committee, ensuring their voices are heard and considered.
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Boosting TVL: This approach can attract more Total Value Locked as projects leverage the open-sourced formula to optimize their chances of securing a slot.
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Recurring & Compounding Benefits: This proposal will further solidify Minswap’s role as a key player in Catalyst Fund voting, with each round amplifying and compounding all the benefits described above as this initiative is launched with each subsequent catalyst fund.
Responsibilities & Compensation
Volunteers
Please note that volunteers are designated for Fund 12 and all subsequent funds, unless they request removal. In such cases, the Minswap Catalyst Review Committee is authorized to appoint replacements. Furthermore, the proposal empowers the Catalyst Review Committee to add individuals whom they deem suitable, via vote, to assist in future funds as needed. Composed of highly competent members focused on the best interests of the Minswap DAO, the committee can add volunteers to this initiative without revisiting the full governance process, thereby preventing voter fatigue.
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Chicken: one of the most active Minswap community members on X and Discord. He authored the $MIN Token Burn Proposal, the supporting DEX Emission Study, and has been involved in any major strategic decisions the Minswap DAO takes for more than 1 year.
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Ramik: has spent the best part of the last decade teaming up with industry giants like Algorand, NEAR Protocol, Curve Finance, and Rarible to help design a better, more decentralized future. Obsessed with all things Cardano for the last 3 years, he’s played a critical role in reviving Optim Finance and propelling two of the few VC-backed projects to prominence. Currently on probation at Minswap Labs.
Scope of Work
The estimated duration specified alongside each deliverable represents the total time commitment required. This will serve as the basis for calculating compensation.
It is important to acknowledge that the process of compiling information, proofreading, organizing, and presenting coherent content—whether it involves data visualization, article writing, or creating Twitter posts—is extensive. Several key metrics must be considered, including engagement maximization, comprehensive coverage, and readability.
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Initiate the Campaign: Compose the initial tweet to launch the initiative, setting the tone and objectives for the program. (1 hour)
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Capture On-Chain Data: At the conclusion of the initiative, collect on-chain snapshots to secure a permanent record of TVL and Cumulative Volume. (1 hour)
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Acquire Twitter Analytics & Screenshots: At the deadline, obtain screenshots of all eligible quotes to ensure all relevant data is documented. (1 hour per 10 quotes)
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Compile Documentation: Assemble a PDF containing the screenshots, calculated scores, and links to the original quotes. (1 hour per 10 quotes)
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Develop an Educational Thread: Create a detailed educational thread to be posted on the Minswap Labs account, explaining each proposal that was assigned a slot, incorporating all relevant information previously outlined. ( 6 hours)
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Author a Medium Article/ Host Twitter Space: Write an article for Medium that not only highlights the initiative and selected proposals, but also illustrates the benefits for Minswap DAO, its partners, and the broader Cardano community. This will be followed up by a Twitter Space for further discussion. (10 hours)
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Submission of Proposals: Submit the proposals that have been selected for the final on-chain vote by MIN holders and address any duplicates in the submissions. (1 hour)
Compensation
The initial compensation framework proposed allocating a percentage of the catalyst rewards for compensatory purposes. However, following community input, we have updated this approach to a fixed pay rate, to be disbursed in MIN tokens from the DAO Treasury.
Our review of the tasks outlined above has clarified the need to establish a pay rate for each type of task. This can be achieved by aligning each task with the most closely related job role, then applying the average hourly wage for that role in the USA—as the dollar is the global reserve currency.
Specifically, Deliverables 1, 5, and 6 align with the responsibilities of a “Content Writer.” According to Ziprecruiter, the national average hourly rate for this position is $40.
Deliverables 2, 3, 4, and 7 are more akin to the duties of a “Data Analyst.” The average hourly wage for this role is also $40, as indicated by Ziprecruiter.
Consequently, a fair compensation for this initiative is proposed at $760, with an additional $8 per quote of the promotional post, to be distributed among all volunteers. This rate is derived from the task estimation for Deliverables 3 and 4, which allocate 1 hour for every 10 quotes, pricing each quote at $4 per deliverable (totaling $8 per quote) to cover data collection, analysis, documentation, and presentation efforts. The total amount will be calculated after all deliverables are finalized and will vary based on the amount of participants.
This compensation model ensures that the catalyst fund voters do not experience further dilution of their rewards. Additionally, it facilitates the strategic utilization of MIN tokens from the Minswap DAO Treasury to remunerate contributors.
Compensation will be issued in MIN tokens, calculated based on their value at the project’s conclusion, and distributed evenly among all volunteers. These funds will be drawn from this wallet of the Minswap DAO Treasury.
