verbsA Nouns token delegation vulnerability
A Nouns token delegation vulnerabilityWe were recently approached by 0xkasper from hexens, a white hat security team, who found a new attack vector based on a vulnerability we were aware of in the Nouns token contract. Nouns tech grants pod has initiated a bounty payment of 30K USDC to the team.TLDRWho’s at risk? Noun owners delegating to EOA accounts (not smart contract accounts).What’s the damage? Noun NFTs can become non-transferrable with no voting power.How likely is it to happen? The pr...
verbsIntroducing Nouns Fork: A Last-Resort Minority Protection Mechanism
Forking is the crypto-native way for groups of token holders to exit together into a new instance of their protocol, resulting in maximal conservation of momentum in the ecosystem; famous examples include the Ethereum Classic fork and the Bitcoin Cash fork. We believe it's time to enable DAO forks as well, starting here at Nouns. To date, there has been no DAO version of forking, but it is needed. How can we protect a minority against a tyrannical majority? Or, in less extreme cases, how...
verbsNouns Governor: Design Alternatives
Welcome to the second post in the Nouns Governor series; Please check out the first post for more context. This time we’d like to share three different design directions we have in mind, with some high level details on how each direction might work. Our hope is the same as last time: to receive feedback from the community; do you have a preferred design direction? Do you think none of them are good enough? The current focus is on how delegation information is encoded and presented. The curren...
we build smart contracts for Nouns. we're on twitter @davidbrai and @eladmallel.
verbsA Nouns token delegation vulnerability
A Nouns token delegation vulnerabilityWe were recently approached by 0xkasper from hexens, a white hat security team, who found a new attack vector based on a vulnerability we were aware of in the Nouns token contract. Nouns tech grants pod has initiated a bounty payment of 30K USDC to the team.TLDRWho’s at risk? Noun owners delegating to EOA accounts (not smart contract accounts).What’s the damage? Noun NFTs can become non-transferrable with no voting power.How likely is it to happen? The pr...
verbsIntroducing Nouns Fork: A Last-Resort Minority Protection Mechanism
Forking is the crypto-native way for groups of token holders to exit together into a new instance of their protocol, resulting in maximal conservation of momentum in the ecosystem; famous examples include the Ethereum Classic fork and the Bitcoin Cash fork. We believe it's time to enable DAO forks as well, starting here at Nouns. To date, there has been no DAO version of forking, but it is needed. How can we protect a minority against a tyrannical majority? Or, in less extreme cases, how...
verbsNouns Governor: Design Alternatives
Welcome to the second post in the Nouns Governor series; Please check out the first post for more context. This time we’d like to share three different design directions we have in mind, with some high level details on how each direction might work. Our hope is the same as last time: to receive feedback from the community; do you have a preferred design direction? Do you think none of them are good enough? The current focus is on how delegation information is encoded and presented. The curren...
we build smart contracts for Nouns. we're on twitter @davidbrai and @eladmallel.
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Nouns DAO is considering incorporating as a Wyoming Decentralized Autonomous Unincorporated Non-profit Association (a “DUNA”). For more information regarding the considerations around that process, please read the Noun Foundation’s blog post.
Because of restrictions on the circumstances pursuant to which a DUNA may make distributions to its members, a key change in this transition will be redesigning the minority protection from forks to cancellable streams. This post contains an initial draft of the streams specification - the design is not yet finalized. To that end, we are sharing this information with the intention of soliciting feedback from the community. We’d love your help finding issues and improving the plan wherever possible.
In tandem with soliciting feedback from the community, we are also working closely with the Nouns Foundation’s advisors to determine how to best achieve full legal compliance for all Nouners, delegates, DUNA administrators, and community members, without sacrificing any of the core principles of the DAO.
We are contemplating changing how auction winners pay for their Noun: instead of paying the full amount to the DAO right away, a small part would be paid to the DAO upon settlement, with most of the funds instead being deposited into a non-custodial and non-upgradeable escrow contract that then autonomously streams auction funds to the DAO over a period of 4 years.
If a Nouner wishes to exit the DAO, they can send their Noun back to the DAO, which will automatically cancel the stream, and they would then receive any unstreamed funds back from the escrow contract.
The stream cancellation right is transferable and tied to the Noun NFT.
Nouns DAO is considering incorporating as a Wyoming Decentralized Autonomous Unincorporated Non-profit Association (a “DUNA”). For more information regarding the considerations around that process, please read the Noun Foundation’s blog post.
Because of restrictions on the circumstances pursuant to which a DUNA may make distributions to its members, a key change in this transition will be redesigning the minority protection from forks to cancellable streams. This post contains an initial draft of the streams specification - the design is not yet finalized. To that end, we are sharing this information with the intention of soliciting feedback from the community. We’d love your help finding issues and improving the plan wherever possible.
In tandem with soliciting feedback from the community, we are also working closely with the Nouns Foundation’s advisors to determine how to best achieve full legal compliance for all Nouners, delegates, DUNA administrators, and community members, without sacrificing any of the core principles of the DAO.
We are contemplating changing how auction winners pay for their Noun: instead of paying the full amount to the DAO right away, a small part would be paid to the DAO upon settlement, with most of the funds instead being deposited into a non-custodial and non-upgradeable escrow contract that then autonomously streams auction funds to the DAO over a period of 4 years.
If a Nouner wishes to exit the DAO, they can send their Noun back to the DAO, which will automatically cancel the stream, and they would then receive any unstreamed funds back from the escrow contract.
The stream cancellation right is transferable and tied to the Noun NFT.
Alice wins the auction for 10 ETH.
Upon auction settlement:
An initial amount of 2 ETH is paid immediately to the DAO.
The remaining 8 ETH are deposited into the escrow contract and streamed to the DAO over 4 years.
The stream is autonomously managed by a non-upgradeable contract which is not under the control of the DAO (or anyone else).
Alice cancels her stream after one year by returning her Noun, which allows her to withdraw her unstreamed funds from the escrow contract (which comes out to 6 ETH).
The DAO can withdraw the already streamed funds from the escrow contract (which comes out to 2 ETH, minus whatever the DAO has already withdrawn).
Unfortunately Nouns which pre-date this change will not have a stream attached. This is due to requirements related to the restructuring of the DAO.
Nounder Nouns will not have any stream, since none of them are paid for.
Upgradeable and under DUNA control: Yes.
Initial payment percentage
Value: 20%.
Can it be modified: Yes, via DAO proposal.
Upgradeable and under DUNA control: No.
Stream duration:
Value: 4 years.
Can it be modified: No.
DAO treasury address
Value: current treasury.
Can it be modified: Yes, via DAO proposal.
We understand that the streams specification represents a large change to how the DAO has historically operated; however, we think that the change, as part of the DUNA migration, is necessary to enable the continued viability of the DAO. As noted above, these plans are not finalized. We are looking forward to continued discussion with the community and welcome any feedback.
Thanks,
verbs ⌐◨-◨
Alice wins the auction for 10 ETH.
Upon auction settlement:
An initial amount of 2 ETH is paid immediately to the DAO.
The remaining 8 ETH are deposited into the escrow contract and streamed to the DAO over 4 years.
The stream is autonomously managed by a non-upgradeable contract which is not under the control of the DAO (or anyone else).
Alice cancels her stream after one year by returning her Noun, which allows her to withdraw her unstreamed funds from the escrow contract (which comes out to 6 ETH).
The DAO can withdraw the already streamed funds from the escrow contract (which comes out to 2 ETH, minus whatever the DAO has already withdrawn).
Unfortunately Nouns which pre-date this change will not have a stream attached. This is due to requirements related to the restructuring of the DAO.
Nounder Nouns will not have any stream, since none of them are paid for.
Upgradeable and under DUNA control: Yes.
Initial payment percentage
Value: 20%.
Can it be modified: Yes, via DAO proposal.
Upgradeable and under DUNA control: No.
Stream duration:
Value: 4 years.
Can it be modified: No.
DAO treasury address
Value: current treasury.
Can it be modified: Yes, via DAO proposal.
We understand that the streams specification represents a large change to how the DAO has historically operated; however, we think that the change, as part of the DUNA migration, is necessary to enable the continued viability of the DAO. As noted above, these plans are not finalized. We are looking forward to continued discussion with the community and welcome any feedback.
Thanks,
verbs ⌐◨-◨
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