A significant reform of governance in Everscale was the highlight of the Everpoint conference held in May. Announcing the reform, Sergey Shashev, the founder of Broxus, explained the rationale behind this comprehensive overhaul dubbed “Governance 3.0.”
Shortly after, the proposal was unanimously approved by Ever DAO, prompting the core network contributors to start the construction of the new governance system. Today, we can state with all the confidence that these plans have been successfully executed. Read further to learn about the key points of the reform, and the initial decisions made within the new governance.
What Has Changed with Governance 3.0?
Despite appearing complex, the changes brought by the reform are grounded in three principles embraced by the new governance body:
- Single treasury. Throughout the years, the network's funds got scattered across numerous addresses and wallets, complicating their management and accounting. The reform will consolidate circa1 billion EVER into a single Treasury, managed by the members of the new Governance Board, enhancing transparency and security.
- Governance board. The new structure includes a Governance Board responsible for overseeing the Treasury and coordinating any related expenses. The inaugural Board comprises over thirteen individuals and companies with a history of significant contributions to Everscale and strong ties to the ecosystem. To qualify for Board membership, an applicant must lock 3 million EVER from their own pocket either by transferring them to a dedicated Treasury account, or by placing a locked stake into a depool.
- Collateral-based funding. The last measure implemented by the reform has probably sparked the most interest in the community, as it is considered a novelty for blockchain governance systems. Previously, project initiators were trusted to deliver on promises without any leverage, often leading to unfulfilled commitments. The new system requires anyone seeking Treasury funding to provide an insurance deposit of 10% of the requested amount. If the project fails, the deposit gets burned.
Overall, Governance 3.0 aims at kickstarting the ecosystem development in Everscale with the acclaimed “skin-in-the-game” principle, while also making the network more appealing to entrepreneurs and major investors.
Members of the Everscale Governance Board
The first resolution by the Board listed 11 initial members. Later, the governance body accepted two more members to its ranks, bringing the total to 13 participants:
- Broxus
- Warp Capital
- HyperFlex
- EverX Labs
- Mao Lulu
- AML Crypto
- Anton Chudakov
- Olamit
- Slava Semenchuk
- CREDER
- Bitmaker
- MTX Connect
- Pi Union
This lineup is expected to evolve, with current members potentially being supplemented or replaced by new ones.
Overview of the First Decisions
In addition to determining its structure, the Governance Board has made a few other decisions, crucial for its further activity.
The first one established the procedure for joining the Everscale Governance Board. To start the process, prospective members must perform a proof-of-stake procedure detailed in a separate document. Following this, they fill out an application, and notify the Board, which then considers the request. Approval requires a two-thirds majority of current members.
Another decision allowed using StEVER tokens for a stake that serves as an eligibility criteria for the Board. StEVER is the token used in liquid staking: every holder of EVER coins can receive StEVERs after locking funds in a special smart contract maintained by Broxus. Liquid staking is available through either EVER Wallet, or the Staked EVER website.
There is an obvious benefit from this option compared to traditional staking: instead of simply locking cryptocurrency, you also receive an additional crypto asset in the form of StEVER. You can use it to enhance the profit, e.g., by providing tokens to the liquidity pools with StEVER on FlatQube. Turns out, StEVER also came in handy for those with significant amounts of EVER locked in staking, willing to take part in the new Governance Board.
Finally, the Board took care of the funds committed by the members. According to a joint resolution, a part of governance stakes (6,000,000 EVERs) was sent to Ever DAO, where it will be used as the Board’s voice in community voting. The rest has been allocated to the network’s validation process with liquid staking through StEVER.
Establishing a Unified Treasury
One of the biggest measures the new governance took was forming the single treasury, a major overhaul to managing the network's wealth. It was decided to keep the Everscale’s treasury on a single multisignature wallet, managed by nine Custodians, appointed from the members of the Governance Board by internal voting.
The first round of voting for Custodians was held on July 18. Governance Board members conducted the block voting: candidates with the highest number of votes were elected, up to the number of available positions. As a result, seven candidates got the most number of votes.
Notably, this voting failed to determine the last two Custodians, as three Board members received the equally high amount of votes: MTX Connect, Pi Union, and Creder. Hence, the Board had to set up a second round of voting, in which MTX Connect and Pi Union secured the most votes. Below is the eventual list of Custodians:
- Broxus;
- Warp Capital;
- AML Crypto;
- Bitmaker;
- Olamit;
- EverX;
- Slava Semenchuk;
- MTX Connect;
- Pi Union.
Responsible for managing the Everscale treasury, these Custodians will make sure not a single EVER is spent to no purpose. A spending transaction from the treasury will require approval from two thirds of Custodians.
In the meantime, the process of collecting treasury funds to a multisig address has already begun, with over 536 million EVERs accumulated in the wallet, as of July 29, 2024.
What to Expect Next?
With the new Governance system and a functional Board to manage the unified Treasury, there is no doubt that more projects to bring value to the network are near at hand.
The consolidation of treasury, as easy as it seems, is, in fact, a quite daunting task, which will take time and effort from the Everscale Governance Board. However, it will likely pay off by increasing the trust in the network from prospective investors and entrepreneurs.
Overall, the evolution of Governance proves that Everscale has not only bounced back from all the past commotion and is poised for pushing forward, but also keeps setting new standards in the industry.
