Livepeer now has a community governed onchain treasury that is filling with LPT. And we have a suggested process for making, and building support for proposals. The spiritual idea behind this treasury is that rather than funding end recipients directly, it instead funds “Special Purpose Entities” or SPEs, that have a mission, and are well suited via their expertise to allocate the received funds to end recipients in that area. SPEs are serving the public-goods needs of the ecosystem.
So what SPEs does Livepeer need?
Let me take a stab at first describing the two in-progress SPEs, and their (summarized) missions.
1. Livepeer Innovators DAO
Mission: Provide retroactive funding to video builders who are doing things that help generate demand for the Livepeer Network.
Expertise: Made up of community members who have a long history of deeply caring about Livepeer, are aware of the Ecosystem, and are willing to dedicate time to sourcing, recruiting, and reviewing applicants to allocate funding effectively.
Commentary: At this point in the evolution of the ecosystem, nearly anything that credibly generates demand for the network, without harmful brand association or safety concerns, can be viewed as a public good. This may not be the case forever as sustainable sources of demand generation grow and decentralized.
2. Livepeer Community Grants
Mission: Proactively fund public goods on the Livepeer Network.
Expertise: Dedicated resources, with years-long history building and participating in the Livepeer Network, using subjective judgement to source, review, and support grant applicants.
Commentary: Proactive funding is very useful to enable new things to be built where there is a known need, or where resource constraints prevent groups with the right abilities to be able to dedicate the time to building out these public goods.
While the above SPEs already exist, here are some unmet public goods needs in the ecosystem that could benefit from dedicated groups.
3. Liquidity Management
Mission: Ensure the proper onboarding and offboarding access points into the Livepeer Ecosystem for node operators, developers, and token holders.
Expertise: Onchain native. Defi, Bridging, Multichain aware. Strong transparency and governance over funds to build trust with ecosystem in managing large amounts of LPT.
Commentary: Livepeer runs on Arbitrum, and currently suffers from a lack of effective bridging solutions to be able to move LPT back and forth between Arbitrum and mainnet Ethereum, where it can more easily be acquired. This is because no incentive exists for users to lock their token in bridging solutions, as opposed to staking on the network where they accrue additional inflationary LPT. This is a great example of a public good that benefits everyone in the Ecosystem, and a good use of LPT in a public goods treasury. The same could be said for other DeFi related integrations such as DEX liqudity on L2, lending protocols, or liquid staking protocols…which all require LPT liquidity. The challenge here is that the proposing SPE would have to convince the community of proper security and funds governance to be trusted to administer large amounts of released LPT from the treasury. This could be accomplished via “don’t trust me because you’re releasing funds directly into a smart contract which will deploy them”, to “trust me via my reputation and track record”.
4. Smart contract security group
Mission: Ensure the security of the Livepeer protocol.
Expertise: The Livepeer protocol. Smart contract development/auditing. Bug triage. Security.
Commentary: Livepeer operates a series of things to ensure protocol security. There is a dedicated security committee. There is a bug bounty program. There are code audits for protocol upgrades. The latter two have benefited the community immensely in preventing lost user funds through protocol exploits. But they also cost significant money. The security committee itself is spread pretty thin resource wise to also react to and triage protocol issues. These are also the ultimate public goods, and the treasury can play a key role in keeping the protocol secure. I will likely propose an SPE that not only funds bug bounties and audits from the treasury, but also retains additional protocol auditors who can be on the front line of response + triage for any issues to continue protecting user funds. Decentralizing this is of key interest for the sustainability of the protocol.
5. What else?
There are many other public goods for the Ecosystem that dedicated groups could focus on over time as these actions decentralize. Here are some category suggestions, though ultimately the missions of these groups would have to be more tightly defined.
- Global community growth
- Testing and QA
- R&D and Innovation
- Funding broader video ecosystem open source and public goods
What other SPE needs does Livepeer have?