Decentralized Hive Fund
I think it is timely to discuss about the Decentralized Hive Fund. About a month ago, I wrote a post about it, mainly to raise my personal awareness and how to evaluated a DHF. I asked some open questions to the community developers primarily, as most of the DHF is related to developers who is working on some hive related tool, I didn't get too many public responses in terms of how to evaluate these proposals. I did receive quite a few private ones, which led me to write this particular post.
The Decentralized Hive Fund (DHF) is an on chain decentralized autonomous system that allows users to submit proposals for funding and vote on which proposals should be funded.
As it is visible on the image above, the current daily budget for the Hive DAO (Decentralized Autonomous Organization), which is just a fancy name for the community fund, is about 4816 HBD/day. Currently, there are 8 proposal funded by the DHF, totaling 1300 HBD/day.
How do we evaluate these proposals
Ideally a stakeholder should read each proposal and decide for himself/herself on the merit. I treid to do that, however, when it comes to "funding" I have very little to compare with. So I asked that question on my previous post, but it was mostly silence. So I thought I should give it a try myself.
I do a lot of data analysis on my day job, where little is known about the data. So one of the first thing people does in that case is compare the data to itself, and see if any patterns emerge. I plotted the 8 data points on a probability plot (magenta triangles). X-axis is a log-scale. Then I fit a log-normal and a beta distribution on it, those are the red straight line and green curved line. On a semi-log plot a log normal distribution is a straight line. Most natural processes are log-normal, so it is important to compare the data to a log-normal fit. If the data does not fit (as in this case) it typically highlight a pattern.
First of all, at the low end, the outliers pop up. The 15 and 20 HBD/day proposals by @anyx and @themarkymark respectively. They are cheap, easy to understand, no-brainer items from my point of view. As an investor, I like to fund cheap proposals if they make sense.
Median of the distribution is important to me (P50), not the absolute number (because it is not a good fit), but the ballpark figure. But if we take the two low numbers away, the fit is quite good. So a 120 - 150 HDB/day proposal seems reasonable.
Obviously, this is just screening. Then I will have to again evaluate the ones I am considering with more detail, and ask questions to understand the merit and de-merit. It will be upto the person or group doing to proposal to convince me, not the other way around.
Does it Matter?
Right now, I have a dark feeling about it, hopefully with time it will go away. But I did a terrible thing, and checked the current top 30 accounts by HP. I also checked how much does it take to get a proposal funded. The answer is about 23M HP staked/or proxy.
As you can see from the above stakeholders, it really only requires 14 accounts to vote for a proposal and it will get funded. Actually the number will be less, because these are just owned stakes, many of the top 30 account, and also accounts outside top 30, have substantial HP proxied to them. So potentially only 10 accounts can get a proposal funded perhaps. Obviously this is an arbitrary case, as no proposals are funded by those exact 14 accounts. But my point is that we are very centralized and 10 big accounts CAN potentially fund a proposal. Neither a community support nor a consensus is necessary.
What can we do? Vote the Return Proposal
Well, I wrote this post, that is something. Hopefully you are reading it, that is something. But unfortunately "hopefully" ... "doth butter no parsnips"
I love British Humor! Hopefully you do as well. However, the only thing we can do perhaps is raise the bar via @gtg 's return proposal https://peakd.com/steemdao/@gtg/steemdao. It does not ask for any money, but other proposals must clear its threshold to get funded. If we vote it, we raise the bar above that 23M HP number where it currently is. Then hopefully the proposal makers will lobby for the proposal more effectively and ask for our vote. As written, that is the fundamental purpose of the Return Proposal.
PS. As I check, proposal #80 is just outside the threshold at the time of posting. So currently there are 7 proposals that are funded. However, it does not change anything I have described in terms of my thought process. As I mentioned I currently support 2 proposals within the funded ones, and of course I vote the Return Proposal.
I think this discussion can be a civil and valid one, and it will help us to seek the truth.