0x944F…E4FE

I propose we start the world’s first crowdfunded compute cluster in Wyoming to take part in the AI revolution and earn income for the DAO.

TLDR

It’s time to do something big to bring CityDAO back to the forefront of the conversation and bring new life and energy to the DAO, and we are uniquely positioned to pull off building a large cluster of GPUs in Wyoming.

We have capital, land, and a Wyoming-based legal entity. And at ~6 cents per kWh, Wyoming has just about the cheapest electricity in the states, making it the perfect place to do this.

Budget:

Total proposed budget: $600,000 USD

• $500,000 - Purchase 300 Nvidia GeForce RTX 4090s (and potentially other GPU types)
• $70,000 - Servers, equipment, other setup costs
• $30,000 - Legal and misc expenses

Business Model

I believe this could generate about $30k / mo for the DAO treasury. Here is the full breakdown of the unit economics 27.

Upon passage of this proposal, Scott will lead implementation of the effort, setting up a fund with CityDAO LLC as the main limited partner and Scott (and potentially others at his discretion) as a General Partner. The DAO will spend $600k for shares in the new fund, and be paid quarterly dividends from the operation of the GPUs. The fund will have a standard 2/20 management fee model. The GPUs will earn revenue by being put on Runpod or a similar service.

Benefits to CityDAO

• A consistent income source for the treasury. These GPUs have an estimated payback period of 12 months and after that generate mainly profit.
• Status and reputation - the first cluster will be called the CityDAO Compute Cluster, and as the first crowdfunded compute cluster will be a hit on Twitter and a real contribution to the AI and crypto communities.
• Compute - having a bunch of compute is cool - we can let citizens use it at a discount and even train our own models on it.

Benefits to Citizens

• Access to a CityDAO Compute Cloud shared server Citizens can use to do things like host websites, run code, etc.
• Potential for discounted or free compute allocation (depends on the economics and will be considered depending on how fast the GPUs are paying off)

Why should we do this?

• Timing - This is the perfect time to start the world’s first crowdfunded GPU cluster.
• New energy and purpose - CityDAO needs an ambitious new project to rally around. The DAO can build tooling and projects around the cluster. Maybe we can all go to Wyoming and visit!
• Wyoming connections - We are uniquely already set up to operate in WY and I recently got connected with a Wyoming-based datacenter with just about the cheapest electricity anywhere - 6 cents per kWh that set up all the infrastructure to run GPUs.
• Future of AI - Demand for compute is projected to increase a lot over the next decade.

Risks

• I want to be transparent that it’s hard to predict the future and demand for compute or our specific GPU type could decrease.
• One reason 4090s are so appealing is they are underpriced in the market because Nvidia’s terms of service require they be used by consumers, not in data centers. One large risk here is that they somehow start enforcing this provision.
• AI may be in a bit of a bubble and demand for compute could decrease.

Updates - 2/13/24

• I’m lowering the ask to $600k - still enough to start up the cluster and run the experiment and a much smaller percent of the DAO treasury
• At the time the cluster goes live, Citizens will each get a free CityDAO Compute NFT to commemorate the moment.

Updates - 3/5/24

• Location: Upon passage, we will do a search for the best data center with the cheapest electricity pricing instead of being tied to Wyoming. For example, states like Texas and Arizona might be better since they have more data center infrastructure already built out.
• Marketing reel: We will take videos and create a marketing reel documenting the process to post on Discord and Twitter

Update - 3/8/24

• Added Risks section
• Added Citizen Benefits section
• Diversify beyond 4090s and purchase other GPU types

TLDR

This proposal has 3 main fuctions:

1. Adjust Quorums
2. Hold Elections for City Council
3. Establish a Complaint Process

Category - Governance Criticalness - High Impact - High (All members of DAO will be affected) Duration - 6 months Quorum - 500 votes counted as 1 NFT = 1 vote Budget - 46,800 (+ bonuses up to $18,000)

The three goals are explained in more detail below:

--Adjust quorums--

Currently, the way votes are counted for quorum is 1 NFT = 1 vote. After a year of governance, CityDAO contributors have realized that it makes no sense for quorum to be the same for $11K and for $2 million, and it makes no sense that a non-financial vote has the same quorum as a CIP for $2 million. The new proposed system would still count 1 NFT as 1 vote for quorum with the following amendments:

1 vote = 1 quadratically-counted NFT An algorithm will be used to determine the quorum for different request amounts. An algorithm will be used to determine the voter approval rating

Quorum Algorithm: 50 + [1/2 * (sqrt $Ask)] Voter Approval Rating Algorithm: 66 + 24 ($ ask / treasury)

• To amend the Charter will require a quorum of 200 counted quadratically. Currently, it takes 1000 votes counted non-quadratically to amend the Operating Agreement (OA). This CIP does not intend to alter or amend the OA. This includes NOT changing how votes are counted for altering or amending the OA. They will be counted non-quadratically as 1 NFT = 1 vote.

--Hold Elections for City Council--

This CIP will create elections for seven (7) members of City Council. Within one week after elections are completed, the Council will choose one (1) individual from inside or outside the Council to serve as the Executive Facilitator (EF). If a member of the Council is chosen as the EF, then the remaining Council members will choose one additional member.

The EF will be a separate position and is not in the Council. The Council delegates the authority to the EF. The EF does not vote in the Council. The EF will be in charge of the day-to-day administration and operational execution, while the City Council is in policy setting and strategic direction. The Council may determine the authorities of the EF. The Council may not interfere in the EF’s authorities except if the EF is incapacitated. The Council are the decisions makers and the EF handles implementation.

The EF will have the following powers and authority:

• Implementation of projects, including resource availability and oversight
• Handle relationships with outside counsel
• Handle mailing address, copyrights, trademarks, legal formalities
• Handle relationships with CPAs for bookkeeping and taxes
• Any powers and authorities delegated by a majority vote of the City Council

The City Council will have the following powers and authority:

• Appointment of Executive Facilitator.
• Possible hiring of an Ops Admin
• Appointment of Multisig Signers.
• Create advisory boards of citizens.
• Policy setting and strategic direction.
• Maintain or hire people to maintain the DAO tools
• Adopt its own rules of procedure and set the time and place of its official meetings.
• Provide for the prosecution and defense of legal causes on behalf of CityDAO and retain counsel and set their compensation.
• Establish and enforce regulations for behavior.
• Establish and enforce regulations for the resolution of disputes.
• Enter into agreements with other DAOs or entities.
• Levy and collect taxes, rents, lease fees and other sources of revenue.
• Make investigations of CityDAO affairs; inquire into accounts, records, and transactions of any CityDAO department, office, or officer; and, for these purposes, require reports from any project and the production of official records.
• Adopt rules and regulations necessary for the exercise of its powers and prescribe fines and penalties for the violation of ordinances in accordance with city law.
• Place questions or propositions directly onto Snapshot, when agreed to by 5 of 7 of the total membership of the City Council.

The City Council will appoint the eight (8) multisig signers. The role of the multisig signers is transaction execution and transaction evaluation. All multisig signers will undergo proper training to fully grasp the implications and responsibilities of being on the multisig. The multisig signers are responsible to check transactions, to check where the funds are being sent, and to follow all the requirements for a proper transaction for the protection of CityDAO. The key aspect of the multisig is that the signers be trusted members of the DAO.

Operations and Day-to-Day Administration

The City Council will help organize and delegate operational tasks, such as maintaining the meeting minutes, permissions, passwords, independent contractor agreements and contracts. The City Council will schedule weekly meetings at regular times, which will not be changed with less than 48 hours notice. Council members will each have the highest level of admin permissions on each of CityDAO’s tools, including but not limited to discord discourse, Twitter, Notion, Snapshot and Google Workspace. The Council will determine who else should hold any permissions or passwords.

CIP Template Creation and Management

In addition to formatting a template for CIPs, the City Council will help problem-solve and request additional information where necessary, to make sure that proposals further the mission of the DAO.

Transparency Dashboard

The City Council will require that, for quality, transparency and clarity, all CityDAO projects create a transparent and available document that provides all pertinent information on funding received, expenditures, milestones and benchmarks. This document will be written in plain English and will be available at all times to all citizens on the CityDAO website or Notion page. The Council will finalize the details of the process. This is not meant to punish people but to provide transparency. Project members must populate the dashboard in order to receive continued funding.

Election Method

If this CIP passes, there will be open elections for seven (7) City Council members, all with six-month terms that begin on the day the election ends. Any citizen may run for any position. A citizen may be on the City Council and the multisig simultaneously. There will be no hierarchy of members on the City Council.

To be elected, candidates must put up a platform statement on Discourse. All candidates will take part in a series of two (2) public debates with questions submitted in advance by any citizen, moderated and run by the Community and Media Guilds together. After the debates, separate ranked choice votes will be put on Snapshot. All elected members of the multisig and the City Council must be willing to be KYC’d.

Election Rules

• The election may not be used as an excuse to disparage the character of another member of the DAO.
• Candidates may not make pledges, promises, or commitments of any sort.

Compensation and Budgets

Multisig Compensation: The multisig signers will receive $100 per month each, regardless of who actually signs the transactions. This is meant to incentivize all members to pay close attention to the transactions, their purpose, destination, suitability and potential liability to the DAO.

City Council Compensation: 3 Citizenship NFT per month per councilmember; City Council will have a fund of 5 NFTs total per month to bring in talented individuals to the DAO. 4 of 7 vote required to give an NFT.

Executive Facilitator: The EF will receive $3K per month in compensation + a potential bonus of up to $3K per month based on performance from the City Council, and will have a budget of $24K over six (6) months and the authority to execute agreements.

• In an emergency event where CityDAO gets sued and is required to pay fees in excess of the funds in the City Council treasury, the City Council can put a CIP on Discourse and Snapshot concurrently, with no time limits required. Quorum will be however many people vote.

Removal

The multisig signers will have one week to sign or reject transactions. If a transaction is rejected, the signers must document reasons why and next steps within a reasonable time. If any of the multisig signers refuse to sign (2) or more transactions, they will be removed and the candidate who had the next highest vote will replace them. If there are no candidates left, a new election will be held for replacements or the City Council will choose replacements. The members of the multisig can vote off any member with a 5 of 8 vote.

If any of the City Council members miss more than three (3) meetings, they will be removed and replaced in the same manner as the multisig signers. The City Council can vote off any member with a 5 of 7 vote. The City Council can remove the EF at any time with a 5 of 7 vote. CityDAO Citizens can call for a removal or replacement of members of the multisig or the City Council or the Executive Facilitator with a CIP and a quorum of 50 votes. If a CIP is put up, it will be done with an anonymous “City Council” account so no one feels pressure to doxx.

--Complaint Process--

A complaint may subject the citizen to penalties up to and including a prohibition on offending parties from holding administrative positions at CityDAO or in CityDAO projects.

• Substance - What Constitutes a Complaint?

An allegation of wrongdoing related to projects, behavior, transactions, or violations of the rules at CityDAO.

• Process - How is a Complaint Dealt With?

Step 1 - Mediation by an individual who is agreed-upon by both parties.

Both parties must agree on an individual, preferably (but not necessarily) a CityDAO Citizen, who will hear both sides of the argument and attempt to mediate between the two parties.

Step 2 - Random jury (Randomocracy)

Complaints that reach step 2 will be heard by a Kleros court. In case of failure, the City Council can choose to use a randomly selected group of six (6) CityDAO citizens using the Chainlink Verifiable Randomness Function (VRF). If either party is not satisfied with the decision, they may appeal to a Kleros appeals court.

Both parties must write a complaint document. This complaint of wrongdoing needs to be complete and make specific allegations along with any evidence. Payment for “jury duty” is $50 per person. This jury of 6 people will make a binding decision based on the facts presented. The Executive Facilitator will enforce the result by initiating a resolution that will go to the City Council to handle the dispute accordingly.

TL/DR: This is a proposal that seeks to: Establish a formal election process (“CityDAO Election Process”) to be used initially for the CityDAO Multisig (“Multisig Election”); Establish compensation and limited authority for the Elected Multisig; Empower Walter Clapp as the Election Facilitator (@wdclapp Discord handle) to administer the Multisig Election and all related aspects of the election process; Compensate Walter (and any team members, as may be determined by Walter in his discretion) for the efforts and undertakings relating to #1, 2, and 3 above.​ Total target compensation = $9,000 (the “Election Comp Pool”); which includes Walter’s compensation plus money available to compensate assistant(s) at Walter’s sole discretion.) SECTION 3.05 of the Operating Agreement states CityDAO’s purpose and mission as follows: “PURPOSE; POWERS. CityDAO was established for the purpose and mission of exploring decentralized governance mechanisms as well as establishing verification of physical asset ownership, such as real property, on the Ethereum Blockchain.” CityDAO has not spent adequate time or money on decentralized governance and this CIP aims to change that dynamic. The time for elections at CityDAO is here. Our First Election will be to Elect Members of the Multisig. According to Chat GPT, “Here are some reasons why DAOs might use elections: Representation: Elections allow DAO members to choose representatives who can make decisions on their behalf. This can help ensure that the decisions made by the DAO are aligned with the interests of its members.

Accountability: Elections can hold representatives accountable to the DAO members. If representatives fail to perform their duties or act in a way that is not in the best interests of the DAO, they can be removed from their positions through a vote.

Transparency: Elections can provide transparency in the decision-making process. All members have the opportunity to participate in the voting process and have a say in the direction of the DAO. Efficiency: Elections can help DAOs make decisions more efficiently. By delegating decision-making to elected representatives, the DAO can avoid delays and inefficiencies that might result from a more decentralized decision-making process.

Legitimacy: Elections can help legitimize the decisions made by the DAO. When decisions are made through a transparent and democratic process, members are more likely to accept and support them.” Currently - The “Multisig” is a body of eight (8) individuals who own private keys that own and control the CityDAO Main Safe Treasury. There are a few ways to manage a DAO Treasury and in the early days CityDAO chose the centralized manner of establishing a Multi-signature Smart Contract. Currently, 5 of 8 signers must sign a transaction to use money from the DAO’s treasury. This CIP creates a Multisig election. Each seat will be paid $200 per month. This CIP also confirms the Multisig authority to not sign transactions if they violate any act of governance (CIP, Charter, or OA), or violate US/Wyoming Law. Walter Clapp will oversee and implement the first election of the current 8 Multisig seats pursuant to this CIP. Walter makes sense as a licensed attorney, and his interest in reinvigorating the republic in America, including a vision for a Constitutional Convention. Walter is also a public candidate for President of the U.S. Walter can achieve the goal of getting CityDAO from the appointed Multisig of today to the Elected Multisig of CityDAO’s future. The election is intended to be completed by July 1, 2023. Multisig members will be up for election every 1 year. July 2023 multisig members will be replaced in July 2024 and so on. Unless a new CIP is passed to amend this one, it will recur with automatic passage annually. Multisig members may serve a maximum of two terms. Once this CIP passes, the CIP and election, to completion, will be publicized by the DAO to Twitter, the Website, Discord, Discourse, and via email. Nominations will be open to be submitted via Forum (Discourse). Self-nominations are prohibited. Nominations will require the person nominating to provide proof of humanity via a photo of their face with the nominee’s name on a piece of paper held by the nominator. Nominations for individuals will be subject to open Q&A, as well as limited debates that may be hosted by Walter.

Eligibility: Nominees will be required to go through KYC and AML, and any other legal hurdles required by the US or Wyoming law, prior to the vote. Nominations will open upon passage of this CIP and shall close on June 1, 2023. Walter will then compile a list of all qualified nominees for voting after the close of each round of nominations.. A virtual synchronous election over a seven (7) day period will occur via a CityDAO Citizen token gated discord channel (or Snapshot) administered by Walter and other present admins. Each citizen will be asked to rank their top eight (8) votes for the multisig. All citizens may only vote one time. Walter will manually tabulate the winners pursuant to the rules of rank choice voting, and publish the results on Snapshot for certification. These new signers will be admitted to the Multisig within 24 hours of certification. The next four (4) highest votes will be alternates. In the event a Multisig member steps down, is removed, or otherwise unable to complete their role, they shall be replaced by the alternate with the next most votes from the election (and if they are not available, the second highest voted alternate would be appointed, and so on). All 8 Multisig seats will begin receiving compensation the month after the first four new Multisignators are elected. Any tampering is expressly prohibited, including without limitation, Sybil Votes and use of Sybil Wallets. If tampering is discovered, the user(s) will be banned from multisig election voting for 1 year; and will be permanently banned from elected positions at CityDAO, or CityDAO positions with budget authority. Walter will work with current moderators and administrators to enforce these rules, publish ample advance notice of the nominations and election, and any updated rules of the election. Walter will publish a CIP to ratify the election and compensation within 24 hours of the election closing. If the elected are not ratified, this CIP will cease. Miscellaneous Terms of CIP-145 Term/Date of Completion no later than September 1, 2023 (note – anticipated ASAP but providing this outside date) The Facilitator role for this Election is a non-replaceable role, meaning that the CIP is formally terminated if Walter is not physically able to complete the election. Only a new CIP can establish a different or alternate election procedure. As stated above, the process will be finalized using a ratification CIP. Other CIPs relating to election considerations or compensation for elected Multisig members may follow depending on the nature of the process itself or its outcomes. Walter may use the assistance of others as he deems necessary, including the discretion to provide compensation from the Election Comp Pool in his discretion. Adjustments and amendments allowed by Proposer or Walter prior to Snapshot, will be tracked, and kept transparent in this Forum page. Payment of any amounts hereunder will be made from the Main Treasury within five (5) days of submission of Utopia payment request with reasonable supporting documentation as necessary.

CityDAO has continued to need basic support and business functions but unfortunately CityDAO did not properly plan for continuation of any responsibilities going into 2023. The need for these roles still exists, and Alex and Josh have continued to function in these roles informally due to their necessity and importance to DAO functioning. These contributors have continued to provide continuation services in their former roles in an unpaid capacity for the month of January 2023 and basic business operations are an ongoing function.

TEAM:

Alex (alexthims) – Bookkeeping & CPA Liaison Josh (j0sh I DAOvolution) – Compliance-Related Operations & Outside Counsel Liaison

PROPOSAL:

1. If a quorum of 250 is reached and this CIP is approved, the Team will use its best efforts to undertake the following “Basic” back-office business functions:

Three (3) month term commencing retroactively to January 1, 2023 and ending March 31, 2023 Continuation of Ongoing Compliance (Legal + Finance) Guild Responsibilities from Q4 2022 Maintenance of the CityDAO PO Box in Cody, WY (including any related fees if necessary) Services provided to CityDAO for basic back-office operation (legal + finance), including but not limited to: Sole Liaison with outside professional service providers (“PSP’s”) Basic bookkeeping record management General filings, property taxes, authority and/or signatures for procuring insurance policies (or as otherwise legally required) Sole Authority to manage the relationships with PSP’s, including any related/reasonable expenditures, with transparent backups supplied. Current PSP’s include: Lorenzo CPA, Montague Law (EthLaw), Burg Simpson (Parcel 0 and CityDAO agent) and Hathaway & Kunz Other PSP’s and software that may be necessary due to evolving nature of projects and DAO operations Retroactive compensation for the month of January 2023 - $1,650 USDC to each contributor Ongoing compensation for February/March 2023 - $1,650 USDC to each contributor Total Team Compensation: $9,900

2. Should this proposal: (i) fail to achieve twenty (20) “likes” on this discourse page, (ii) fail to meet quorum, or (ii) fail to be approved:

Should this CIP-142 not proceed for any reason other than withdrawal or abandonment by its proposers, it will be deemed to be a formal act of governance relieving Alex and Josh of their duties and assumed carry-over responsibilities from Q4 2022. Should this happen, the roles described herein will go unfilled, and the proposers will no longer be responsible for any of the above-mentioned responsibilities or any other responsibilities/duties with respect to the DAO. The proposers will be expressly released from any and all responsibility relating to the performance of these duties henceforth.

Miscellaneous Terms of CIP-142:

All payments will be made from the Main Treasury: 0x60e7343205C9C88788a22C40030d35f9370d302D

Payments initiated for or from this team will be queued to the Main Treasury using an appropriate method, including without limitation, a Utopia payment link including supporting documentation. The Multisig will execute such payments in a timely fashion, but in any event, no later than five (5) days after submission from the team.

If for any reason, the project Team must pay for a DAO-related expense, CityDAO will promptly reimburse such team member(s) for these expenses, including any related transaction fees or gas fees. If performance of duties hereunder requires a physical or digital signature, the team members are authorized to make it, and for the avoidance of doubt or ambiguity, the team members are the only people in the DAO who are expressly authorized to do so with respect to accounting or legal professionals on CityDAO’s behalf.

The project proposers may transition their responsibility to a suitable and adequately qualified CityDAO contributor, subject to CityDAO’s selection and/or approval of said replacement. The team may also resign from responsibility, at any time upon seven (7) days written notice given to CityDAO (in a manner deemed suitable to CityDAO). For the avoidance of ambiguity - This CIP-142 is not a contract for employment or otherwise.

This CIP-142 may be amended by the proposers at any time prior to Snapshot, subject to compliance with all other material terms contained herein.

Performance hereunder will be expressly subject to the indemnity rights afforded by the CityDAO Operating Agreement. Additionally, this team will not be liable to CityDAO or to any Citizen, or any other party for that matter, with respect to its performance hereunder, nor for any other types of damages, including without limitation, any incidental, indirect, special, consequential, exemplary, or punitive damages. CityDAO agrees to defend, indemnify, and hold the team harmless from any such claims, liabilities, or damages, including the team’s attorneys fees. Wyoming law governs this CIP and all related considerations. For the avoidance of doubt, these defense, indemnity and hold harmless obligations will extend from CityDAO in favor of the project team for any and all issues that may arise in the future due to a lack of accountability or responsibility-holder in the former roles in the event of #2 above, and this provision is a material term of this CIP-142. (for example, if a service provider sends CityDAO to collection, if services lapse, or if taxes are not paid - this team is EXPRESSLY NOT RESPONSIBLE if the conditions set out in #2 above should occur). The intent of this provision is to say that, should CityDAO miss payment of an amount that this team would have been responsible for had they been approved, they are expressly not responsible.

This team will work directly with the CityDAO Multisig but the team members will not hold or retain seats on the Multisig, and this will include any replacements who later fill either role due to transition/resignation or are added later.