This past Thursday, we voted in favor of step one of the “ forumretire ” proposal by EOS Nation. This proposal has since been approved in a 15/21 BP vote. In this post, we’d like to offer a short background on the proposal and elaborate on our stance on this important issue.
Background
"retiresaving" is a two-part proposal from EOS Nation that relates to an initiative to burn the EOS that has accumulated in the eosio.saving smart contract. The EOS mainnet launched with a 5% yearly inflation rate— 1% of which is paid out to BPs, and 4% of which goes to the eosio.saving contract. The idea behind this contract was to create a network treasury that could be used to fund various initiatives and developments that could bring value to the EOS ecosystem. The problem was that, while the network launched with an active savings contract, the community did not have a plan in place to allocate those savings. As such, those funds have been accumulating in a smart contract with no clear way to decide on how they are spent.
Since network launch, there has been an ongoing community discussion around what to do with these funds. In recent months, many within the community have begun to express concern about both the size of the fund (it currently holds ~$176M worth of EOS) and the ambiguity around its allocation. As such, many have proposed that the funds should be burned. The EOS Nation proposal is an attempt to officially move forward with this course of action.
The first part of the proposal, called “forumretire,” simply issues a statement from the eosio.prods account (controlled by elected BPs) to the eosio.forum (referendum contract) account describing the intended action of burning the savings funds. Article VII of the EOS User Agreement , which currently serves as the network’s governing document, stipulates that any proposal to alter network funds should be first put towards a community vote in the form of an on-chain referendum. This not only allows BPs to signal to the community their position on the subject, but it also allows all EOS token holders to signal their support or disapproval of the proposal. As we mentioned before, the “forumretire” proposal was approved, and a referendum called “ retiresaving ” was issued by the eosio.prods account. Any EOS token holder may now participate in that referendum (and you can do so directly through our eos-voter wallet!).
The second part of the EOS Nation multi-sig proposal, alsocalled “ retiresavings ,” is an actual proposal for a 15/21 BP multi-sig vote to take action and burn the existing funds. We have not yet voted on this proposal, as we’d like to spend more time gauging token-holder community sentiment before doing so.
Our Stance
We recognize that many within the EOS community are concerned about the sheer size of the existing eosio.saving fund, and we share that concern. To have such a large community fund, without a clear plan in place for how it should be allocated, could lead to potential conflicts. For this reason, we do support the burning of the current balance. We believe that doing so will eliminate the potential risks that such a large fund creates for the network and will allow the community to move forward.
However, we’d also like to clarify that we believe that there are very legitimate uses for community funds that will bring value to the EOS ecosystem. We encourage the community to consider options that go beyond just a simple burning of the current eosio.saving account funds.
There are important reasons to support allocation of network funds to non-BP parties who can work for the network. Ultimately, this system could bring increased long-term value to EOS by promoting decentralization. We dive into this topic in-depth in this post . Further, we believe that those funds can be used in ways that are productive and drive value to the network.
While it makes sense to burn funds when there is not a clear plan in place to allocate them, we don’t believe that this should stop the EOS community from exploring such plans. As such, we believe that there may be additional courses of action that could be taken afterthe existing funds are burned.
One potential path forward would be to turn down the faucet of funds flowing into eosio.saving, but not to turn it off entirely. While many believe that 4% inflation is too high, we would support a lowering of the faucet to 1-1.5%, as we believe there may be future uses for these funds. We would also support a yearly or quarterly burn of unallocated funds by BPs to prevent the contract from accumulating too much unallocated EOS over time. There is, of course, no way to allocate these funds without a funding system in place. This is something we have been exploring internally and will be publishing more ideas on in the very near future.
As always, we invite the community of EOS token holders to share their feedback and opinions. You can find us on Twitter , Telegram , and Reddit . Or feel free to reach out via email at hello@greymass.com. We look forward to hearing from you!