Open discussion for IISS enhancements

Hi everyone.

This is Ben Lee from the ICON Foundation. It has been almost 4 months since decentralization and I think we are doing great. However, I believe there are a few things to make the ICON Network better and I want to discuss it with the community to decide together.

We were hoping to have a finalized proposal to share before the first P-Rep meeting, but we found issues with the incentive structure of our planned proposal. We would like to spend more time going through the math before submitting a formal proposal to the community.

However we still would like to share the overall direction we are considering. We can discuss these topics on the call:

  • Bond Requirement: Many voters are scared of being burned and we think this is an issue. We also think it is an issue that many P-Reps have nothing at stake themselves and voters are taking all the risk of holding ICX. We believe P-Reps should be accountable for their own actions and should also have “skin in the game”. We are still deciding on the size of the bond requirement, but it will be a percentage of total delegation received. This will also lower the advantage of vote buying because P-Reps will need to post a larger bond as they get more votes. If they can’t post the full bond they will not get full rewards. This will also incentivize P-Reps to not sell some of their ICX because they need to have it as a reserve to post bond as they get more votes.

  • Voter Behavior: We are considering economically incentivizing voters to vote for lower ranked nodes. By doing this, we can incentivize people to vote from sub P-Rep without hurting their free will and could give more chance to Sub P-Rep to become main P-Rep. In addition, this could help people to care more and often with their votes and incentivize self-delegated/exchange P-Reps to stay out of the top 22 to maximize their rewards while also incentivizing general voters to spread around delegation.

  • Contribution Proposal System: This will no longer be based on delegation. We are also removing the concept of DBP vs EEP and will only have one general category of “Contribution Proposals” that can be used to fund DApps or anything else. The CPS paper is almost done being re-written, but there are still some variables to consider. From a high-level, it will be a budget based system, where individuals submit a request for a budget with a specific proposal, the proposal is reviewed by Main P-Reps, then it is either approved or rejected. It will function almost identically to the current ICON grant program, except Main P-Reps will be the decision makers instead of the ICON Foundation

  • Contribution Proposal Fund: There will be a fund with a set amount of ICX available on a monthly basis to fund approved Contribution Proposals. The source of these funds is still under consideration (discussed in the next bullet)

  • Contribution Allocation: We are considering a system that allocates a portion of higher-ranked P-Rep rewards to contribute to the Contribution Proposal Fund. This will ensure that rewards are used directly for contribution and not simply sold on an exchange. We all love the idea of the Contribution Proposal System, however, if it is funded with additional inflation it is not a great solution. By allocating a portion of P-Rep rewards directly to contribution, we can lower inflation while also ensuring funds are used wisely and not selfishly.

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Bond Requirement: I think this is a good idea, but would suggest to make it possible for P-Reps to submit an alternate wallet address. Depending on the size of the bond and the price of ICX, some teams may not feel comfortable keeping it on a hot wallet.

Voter Behavior: I’m mixed on this one. I actually don’t think there is evidence that performant teams that are engaged with the community are not receiving votes. ICON DAO and Mineable are two examples that came later in the IISS process, and they were able to secure votes due to their hard work and constant output. Mineable is actually Top 10 now because he is constantly putting out good contributions, and voters love it. The reality is 80-90% of the sub P-Reps have shown very little contribution, and quite a few of the teams are self-staked. It doesn’t make sense to reward ICONists with more ICX when they vote for low-ranked sub P-Reps that aren’t putting in much work. History shows sub P-Reps that put in a lot of work and engage with voters will succeed. That adds more value generation to teams that are historically inactive, and takes away value generation from teams that are historically active (minus a few teams in Top 10 that don’t seem to do much at the moment). Wouldn’t this also introduce a sense of budget unpredictability if ICONists are encouraged to vote for the lowest team in a cycle?

Thinking about the other points… will comment later.

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I agree the network has done well and always looking to improve. These are some interesting concepts and I’m looking forward to discussing. A few clarification questions so we can accurately assess / discuss:

  1. What type of range % are you looking at for the bond?

  2. What type of advantage / incentive range are you looking to apply here?

  3. Would the contribution proposals be similar passing requirements to current network proposals? (66% Weighted vote + 66% of number of p reps)?

  4. Will the size of the contribution pool be similar to the p-rep reward pool, or a fraction relative, or larger? Any idea on this.

Thank you!

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What attracted Icon4Education to Icon out of the top 200 projects?

Answer: The IISS system and the global connections and success Icon will achieve in it’s near future.

In education, we have a hierarchy of bus drivers, assistant teachers, teachers, principals, district superintendents, state superintendents, governments, and taxpayers working together for a common purpose- to educate and grow children at their individual level.

There is a similar dynamic that relates to Icon’s IISS governance system. We have PREP teams, ICX Station, the Icon Foundation, and the community (voters) that want what is best for Icon. We have an amazing system (as it stands) and have a plan to achieve the above goals within our current system in advance of Icon’s planned improvements.

Icon4Education is starting a 10-week podcast that will highlight the contributions of 9 sub-preps. Today, we delegated (voted) with 5% of our teams ICX to the team we are going to give a podcast on. This week our first podcast will focus on the contributions of (#89 Prep) Icon4Business. We will continue to delegate 5% of our $ICX to 9 other PREPS that we highlight with a podcast. This process will continue until 50% of our team’s ICX is delegated to other teams.

Icon4Education is not spending a single $ICX for 2 years so our transparency will lead by example.

Our proposal is for all 100 PREPS to publicly (transparently) delegate (vote) with some of their ICX rewards to 9 PREPS that they feel are adding value. Some PREPS state they vote for other teams from their private wallets but this is not transparent and no one actually knows if it is true. In addition, some PREPS state they are not comfortable with holding ICX on their team’s wallet but remember we are only asking for a % of their rewards to be used in voting for 10 other PREPS within the ecosystem.

The voters can easily see that the Prep is delegating rewards to other PREP teams by clicking on the distribution link from the PREP governance page.

How can this benefit Icon?

*If the community (voters) see that PREPS lead by example in delegating and supporting multiple teams for their contributions they will follow.

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Hey @thelionshire I think I can answer those questions.

1.) The range has not been meaningfully modeled out yet. I can say we’ve never discussed anything higher than 10%.

2.) This also has not been modeled in depth. This part of the list of considerations is a relatively newer part of our discussions

3.) Yes

4.) The size of the contribution fund depends on where we end up getting the funds from, but we were thinking this would be adjustable via a Network Proposal based on the necessity of funds and the price of ICX at the time

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Thank you. Also had same question as Brian: for the bond would this be self staked / voted and also would it be able to be stored on ledger?

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Thank you Ben. It’s great that the ICON Foundation has put much thoughts into enhancing IISS.

  1. Bond Requirement: This is a fantastic idea. This will encourage the P-Rep to commit to ICON long-term development. I would also argue it will create a more stable network as larger amount of ICX will be staked. Agree with Brian about having the ability to store the bond in the ledger in lieu of storing in the hot wallet.

  2. Vote Behavior: Rather than incentivizing voters to vote for lower ranked nodes, ICONex should provide a message display on the Voting page, clarifying that the reward is the same whether you vote to the main P-Rep or Sub-Rep. There are many investors who I had spoken with are misled and thought they would receive more staking rewards by voting to the Main P-Rep in lieu of the Sub P-Rep. ICON Foundation could build a recommendation tool to recommend the top 10 P-Reps with active nodes (This could be random or constructed).

In addition, in order to encourage voters to stay active, the reward system should behave like a decay log chart. For example, voters who vote/re-vote within 7 days will receive full reward (100%). However, if the voters are inactive longer than 7 days, their reward should be reduced based of the decay log with 100 days they receive 0 reward.

Contribution Proposal System: Agree. This system will demand active participation from the Main P-Rep. What happen when the Main P-Rep does not vote or abstain.

Contribution Allocation: Agree. Current reward structure is very linear. It would be great to reduce the reward for for higher-ranked P-Rep and use the delta to fund the “Contribution Proposal Fund.”

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I think these are all great ideas, I have one question regarding the “Bond Requirement”.

If a P-Rep doesn’t have enough bond would the voters receive also less rewards? It might sound a little too drastic but it could also motivate even more that the P-Rep needs to have the entire amount required for the bond or they will lose voters.

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It might result in chicken and egg problem.

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Vote decay is a common suggestion but I disagree with the expected outcome. I don’t see why somebody would not simply come back and vote for the same node or another arbitrary node. There is absolutely no incentive to do research for the average ICX holder. Even if we provided one bullet point for each team, that’s 100 bullet points to read and analyze before voting. People don’t spend this much time

As for providing better information to voters, I agree this should be done but also disagree with the expected outcome. The people who actually care about who they are voting for is a much smaller fraction of the ICX holder population. This information will help some people make an informed decision, but most people are voting for the economic incentive imo. I’m not saying to neglect that small fraction, just that the suggestion will not solve the problem we are currently discussing

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A few thoughts.

Bond Requirement: Seems like a good way to incentivize reward hoarding by P-Reps. Especially if the bond is anywhere near 10% as Benny_Options mentioned. That’s way too high. I think this would empower self staking whales more than anyone else. Don’t really see how it fights vote buying either. I don’t really buy the “many voters are scared of being burned” argument. If they are - they shouldn’t be. As most of us know, it would take hundreds (or even thousands) of consecutive down days to fall below 85% productivity and activate the 6% burn.

Voter Behavior: This one feels a little bit backwards. In my opinion, by doing this you would disincentivize contribution and reward passiveness.

Let’s be honest, in this kind of system, most people will vote to get more gains. They won’t look at contributions. I see this as a pretty huge handicap for any new up-and-coming, contributing teams who would be slammed back down as soon as they touch Top 22 because Sub-Preps nodes offer bigger rewards. I like the idea of improved vote distribution but I think the focus should be on getting those votes out to the few Sub-Preps who are actually contributing. I understand that’s the tricky part.

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Bond Requirement: Mixed feelings about this one. It won’t influence teams that self-bought in at all, even favors them above everyone else. Set it too low and it won’t matter. Set it too high (above mentioned 10%) and you’ll have teams hoarding ICX nearly for a year to comply with that, where some of them might even freeze their activity completely until they reach it.

Overall, I think teams should use rewards they get to grow the ecosystem. Hoarding coins is the opposite of that. If they can’t use them, then there’s no good reason to mint those coins in the first place.

Voter Behavior: This could just result in shifting the voting pattern from the top few to bottom few. E.g. I want to get rewards, but don’t want to bother with anything – I’ll vote for the last P-Rep, because it’s the least likely one at the moment to become a main P-Rep and lower my earnings.

Contribution Proposal System: Sounds good. It makes it easier both for voters and projects. Seems that bootstrapped forum CPS paid off.

Contribution Proposal Fund: Why “set amount of ICX available on a monthly basis”? Shouldn’t it accrue whatever excess there might be?

Contribution Allocation: I’d prefer to see the total budget for P-Rep rewards slashed by the intended contribution allocation and the rest distributed more evenly than it is now rather than to tax the top few.

I also hoped this would include increase in Main P-Rep count and better reward distribution across all P-Reps that was mentioned months ago.

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Hello @bwhli,

In terms of the alternate wallet address, it looks fair point. We are discussing internally to implement key dualization. This function will make two types of keys, the key for consensus and the key used for governance.

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Voter Behaviour:

In my personal opinion, I don’t see how restructuring the reward rates would benefit ICON, PReps, voters and more importantly, a healthy ecosystem.

Scenario A: PRep X ranked #53 is a sub-rep who’s a whale and self-stakes with no intentions to contribute to the project, has never engaged with the community or has any interest in ICON’s developments but happy to run a node, take in the rewards to sell to pay for his lamborghini (thus creating inflation & sell pressure)

Voter B decides to vote for PRep X because he doesn’t care who he chooses to vote for, as long as it’s a sub-rep, he’s happy with his higher rewards.

Instead, it would be nice if ICON considers promoting sub-rep teams accomplishments on ICON’s website or the icon.community dashboard or a newsfeed integrated to the ICONex wallet staking interface > A weekly promotional billboard flashing ‘ReliantNode presents a desktop wallet with staking > myiconwallet.com#vote #spread #disrupt

New ICONists/investors visiting any of these websites or accessing their ICONex wallet to stake/vote, will instantly be introduced to a sub-rep team listing their accomplishments or published articles.

It may be extra work for the ICON team to publish/upload a new sub-rep team each week but it’s a win win for everyone!!

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I feel like we’re discussing solutions without first finding consensus on what the issues are. Could we please officially agree upon/document what the problems/limitations are so as we can all collectively focus on solving them. I’m sure ICON has done this internally, but for the community and P-Reps everyone has their own ideas about what is working and what isn’t. This should be achievable in a very short timeframe (ie a few days/week) and I believe it would help us all to come up with productive solutions together.

I also want to voice my personal opinion that currently the redesign is being tackled in a very centralised manner. We’ve had an IISS upgrade forum topic here for a very long time, until today ICON hasn’t commented about it publicly. We know that the team has been working hard behind closed doors, but there needs to be more transparency. There has been considerable public criticism of top P-Reps lately, yet they have been left out of the discussion process until today.

ICON also has the expertise, control, and voting weight to make unilateral change, so the reality is P-Reps and the community actually have zero leverage or a binding influence on policy here. We’re only able to make suggestions and work together, so let’s actually work together as efficiently as possible in our shared endeavour.

To my mind there are a couple of obvious issues:

  1. A lot of voters/votes have been placed on the top teams listed in the voting list by default.

  2. Voter apathy. There is little reason for passive ICONists to revote/move their votes.

  3. The ability to revote is not technically possible, yet.

  4. The voting interface needs upgrading to address people that vote for the first teams listed.

  5. Velic - A top P-Rep who doesn’t interact much/if at all on governance or with the community.

I like the bond idea.

I think giving higher rewards for voting for subpreps is a VERY BAD IDEA. It does not address the root cause of the problem and will lead to people voting for passive nodes. I think Parrot 9s suggestions for improving the voting process were far better.

My number one wish is that we all need to think outside the box on how to achieve a revote once we have an improved voting interface. I refuse to accept that it’s not possible solely because it interferes up block production. We could have ICON ready to take over block production via 22 newly created nodes whilst we all voluntarily take down our nodes and start again from zero. There could be an exciting marketing campaign put behind this to let the community know they have to revote, and we can provide additional financial incentive to encourage a revote within the first few days/weeks.

Let’s not let our current technical limitations limit our creative thinking.

I’m very excited for the future and in compete agreement that we need to upgrade things. Thank you everyone for your contributions! I’m extremely proud of the ICON Foundation, our community and my fellow P-Reps. :facepunch:

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What if the main p-rep teams had to chose a “running mate” from a team outside the top 22. They would have to share a certain percentage of their rewards with this team. Therefore they must research a good team that is actively helping the ecosystem. This could start highlighting some of the work of the other p-rep teams which, honestly most people really don’t have much time to research.

This would also show which top p-rep teams are doing their due diligence and choosing quality partners.

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Bond requirement: P-reps should be accountable for their actions, what will the bond be used for? Will, there be a possibility of ICX in this bond being burned if P-reps actions are hurting the ecosystem? Who will decide on that? Also, the requirements for the bond shouldn’t be high at the start or it may completely halt the progress of P-reps. Maybe a gradual increase to ease the system in. If we put 10% of delegated votes the lowest main P-rep would have to provide 250.000 ICX into a bond which is a huge amount to start. Also, what would happen if a P-rep got a lot of support for the work that they have done and suddenly they have a lot of votes dedicated by the community? Does that mean because they don’t have funds to allocate to the bond that they shouldn’t receive rewards?

Voter behavior: Incentivizing people to vote for sub P-reps is not necessarily better for the ecosystem. If something like this is implemented I’m sure there will be sub P-reps promoting themself without contributing by stating “you get this bonus if you vote for us as a sub P-rep”. People who don’t do a lot of research on P-reps are familiar with the ICON Foundation and they think if someone is a top P-rep they can be trusted which concentrates the votes. The way ICONex is designed by listing P-reps according to the number of votes doesn’t help with this. If you look at similar situations on some other applications like google search or amazon, people rarely scroll to the 2nd page and they usually buy stuff from the first few listings. Education of iconist is important here as well as providing information in a manner that doesn’t take an iconist to much time to keep track of what’s going on with all the P-reps.
I think the topic here should be how to incentivize iconists to be an active voter instead of leaving their votes allocated to a single P-rep of course if a P-rep is doing a good job those votes shouldn’t be reallocated. So maybe some sort of system that incentivizes taking another look at the P-reps you have voted for when you claim your I-score. (I’m just thinking on the fly here, I’m sure there are better solutions to this but it’s just a basic idea).

CPS: I’m looking forward to the CPS paper, but generally support it with maybe some minor adjustments like the contribution allocation posted by blockmove. No need to have ICX rewards going into the hands of top P-reps just for them to send it to the fund. Isn’t that what blockchain is about, cutting out the middle man?

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I like the idea of the re-voting, mimic a similar democratic voting style. Maybe we should implement a re-voting annually.

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Higher voting rewards for sub P-reps can have a negative impact on the ecosystem
There may be many sub P-reps that do nothing but simply receive a lot of votes and share rewards.

Bond as an option - a good idea, but there are a lot of questions about that.

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  1. Bond sounds interesting. I’m for having skin in the game (I myself do). I do have some concerns with implementation and I also do not think it will stop vote buying. I also have concerns that it will foster an environment of hoarding and not spending- it is good to save some rewards but some should be spent on contributing. If even 10% is required, this would be a lot, especially as price goes up, and limit some teams that may not have started with capital. Perhaps if It was less than 5% and implemented as a penalty for having no skin in the game (such as 10-20% less rewards), with a forgiveness period while first getting started, would work? My other concern is how the bond would be verified, and can this icx still be staked? I would not support a system where the bond cannot be stored on a ledger and also staked. But would we need to give up the address and lose privacy?

  2. I echo that I am against higher rewards for lower p-reps just for the sake they are lower. You’ll end up with teams marketting they and only that. Also, if teams gained votes to get into the top 22 and be a main P-Rep, their voters should not have to decide whether to continue support or earn less.

3-4: I am for the contribution system and getting rid of the previously planned eep and dbp. As we are seeing, voters seek rewards and most do not take the time to perform proper research. Relying on voters to determine what DApps and eep’s gain funding could be a dangerous game and end up with a few “cool names” or logos as the top.

I think it’s an excellent use of the p reps to make selections, however, I do have concerns over the efficiency of this. There are several teams in the top 22 that are completely inactive. Can we really rely on them to go through proposal submissions and vote?

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