Litepaper - The DAO future of Anu Initiative

[1. Introduction]
[1.1. Traditional Charity Giving]
[1.2. Transparent Blockchain-based Giving]
[2. The Problem]
[3. The Solution]
[4. Using Blockchain Technology for Transparency and Trust]
[5. Vetting Process for Impact Partners]
[6. Cryptonomics]
[6-1. Initial DEX Offering Token Allocation]
[7. Membership Structure]
[7-1. Core Members]
[7-2. Members]
[7-3. Code of Conduct]
[8. Voting Rights]
[8-1. Initial Voting Rights Setup]
[8-1-1. Advantages]
[8-1-2. Limitations]
[*8-2. Proposal Rights Gating]
[9. Ideal Voting Rights Setup]
[10. Supporting documentation]


1. Introduction
Anu Initiative is a blockchain-based fundraising platform that aims to support ecologically oriented impact partners through a Decentralized Autonomous Organization (DAO). By leveraging the power of blockchain technologies, Anu Initiative seeks to provide a transparent, efficient, and secure platform for fundraising, while also promoting environmentally sustainable practices.

A DAO is a decentralized organization that operates through rules encoded as computer programs called smart contracts. This document details the governance model for Anu Initiative, a DAO focused on providing for those who provide for Mother Earth.

We are a Company Limited by Guarantee based in Dublin, Ireland (:ireland:), and our legal entity’s constitution documents that we will use at least 90% of the generated funds to give to other vetted ecology-oriented charities, while up to 10% can be used to cover operational costs. For this, Core Members are legally liable, and to provide full transparency to the Anu Initiative community and to our regulators, all transactions will be made public and archived on the blockchain.

Transparency, passion, integrity, commitment, and community are the organization’s values that will guide the governance model’s implementation and further development.

Link to Anu Initiative’s Test DAO: Snapshot

Link to Anu Initiative’s Discussion Board: https://forum.anuinitiative.org

Link to Anu Initiative’s Treasury: Treasury - Anu Initiative - Web3 in service of Mother Nature Treasury

Link to Anu Initiative’s Test-net Smart Contract: https://testnet.bscscan.com/address/0x6b3e4d70005d210e29a74283ab69ed52c6b5810b#code 1

Traditional Charity Giving

Pros:

  • Established and widely recognized organizations exist, allowing donors to easily identify and support a cause they care about.
  • Donations are tax-deductible, offering an additional incentive for charitable giving.
  • Some organizations offer transparency reports to show how donations are being utilized.

Cons:

  • Lack of transparency – It can be difficult for donors to know how their donations are being used.
  • Middlemen and overhead costs – A portion of donations may be used to cover operational and administrative expenses.
  • Potential for fraud – There have been many cases of charity organizations misusing funds or being outright scams.
  • Limited control – Once a donation is made, the donor typically has no further say in how the funds are used or distributed.

Transparent Blockchain-based Giving

Pros:

  • Greater transparency – Blockchain technology allows donors to track how their donations are being used in real-time.
  • Decentralized control – Decentralized autonomous organizations (DAOs) give donors more control over how their funds are used.
  • Lower overhead costs – Blockchain-based donations can cut out the need for intermediaries and drastically reduce administrative costs.
  • Trust and security – The use of blockchain technology provides a high level of security and eliminates the potential for fraud.

Cons:

  • Lack of mainstream adoption: The use of blockchain-based donations is not yet widespread, which may deter some potential donors.
  • Complexity: Some individuals may find the process of donating through a DAO to be confusing or intimidating.
  • Limited acceptance: Not all charitable organizations are equipped to accept blockchain-based donations, which may limit the number of causes that can be supported. Anu Initiative CLG acts as a bridge between the blockchain and real-world transactions to convert blockchain donations to fiat without unnecessary fees.

2. The Problem
The global environmental crisis is one of the most pressing issues facing humanity today. The world is facing unprecedented levels of biodiversity loss, deforestation, climate change, and other environmental challenges that threaten our very existence. Traditional fundraising methods often suffer from issues such as lack of transparency, high fees, and a lack of trust, which can limit the effectiveness of efforts to address these challenges.

3. The Solution
Anu Initiative proposes a decentralized fundraising model using blockchain technology to address these challenges. By creating a DAO, Anu Initiative will provide a transparent and secure platform for raising funds and distributing them to vetted impact partners who are committed to promoting environmentally sustainable practices.

4. Using Blockchain Technology for Transparency and Trust
Anu Initiative uses blockchain technology to create a transparent and secure platform for fundraising. By leveraging the power of smart contracts, Anu Initiative aims to automate the process of fundraising and distribution of funds to impact partners. This eliminates the need for intermediaries and reduces the risk of fraud or mismanagement.

5. Vetting Process for Impact Partners
Anu Initiative’s impact partners are carefully selected and taken through a thorough vetting process to ensure that they are committed to promoting environmentally sustainable practices and comply with Anti Money Laundering and Counter-Terrorism Financing regulations. This includes an evaluation of their track record, their goals, and their alignment with Anu Initiative’s mission.

6. Cryptonomics
Anu Initiative’s model is simple – each transaction (buy, sell) is taxed with 1 to 3% as follows:

  • 1% of each transaction is collected in the Treasury. This creates a sustainable source of funding for the DAO, which can then be used to support impact partners who are working to address environmental challenges. Transfers of funds from the Treasury can only be done with the approval of the DAO citizens.

  • Optional: 1% locked in Liquidity Pool:
    Provides Stability – Liquidity is an essential element of a functioning market, and locking a percentage of tokens in the liquidity pool helps to stabilize the price of the token by preventing extreme price fluctuations. The locked tokens serve as a buffer against sudden sell-offs or large buy-ins, which can otherwise cause a significant shift in the price of the token.
    Increases Liquidity – By locking a percentage of tokens in the liquidity pool, it increases the overall liquidity of the token. More liquidity means that there are more buyers and sellers in the market, which helps to facilitate trades and keeps the market moving.
    Boosts Confidence – Locking a percentage of tokens in the liquidity pool shows investors that the project team is committed to providing a stable and liquid market for the token. This can boost investor confidence, which can lead to increased demand for the token and ultimately, a higher price.
    Prevents Price Manipulation – Without a locked liquidity pool, it is easier for traders to manipulate the price of the token through a practice called “pump and dump.” This is where a group of traders artificially inflate the price of the token by buying up a large number of tokens and then selling them all at once, causing the price to crash. Locking tokens in the liquidity pool makes it more difficult for traders to manipulate the price of the token.

  • Optional: 1% distributed among holders:
    Rewards Holders – Distributing 1% of the transaction fees among token holders rewards them for holding the token. This can incentivize long-term holding and reduce volatility in the market, as holders are less likely to sell their tokens if they are receiving a steady stream of rewards.
    Increases Demand – By distributing a portion of the transaction fees among token holders, it creates a new use case for the token. Investors may be more likely to purchase the token if they know they will receive a share of the transaction fees.
    Aligns Incentives – Distributing a portion of the transaction fees among token holders aligns their incentives with the success of the project. If the project is successful and transaction volume increases, so too will the rewards for token holders.
    Provides a Sustainable Revenue Stream – Distributing a portion of the transaction fees among token holders creates a sustainable revenue stream for the project. This can be used to fund ongoing development or other expenses, which can help to ensure the long-term success of the project.

In addition to transacting the Anu token, anyone can donate transparently to the Anu Initiative Treasury.

6-1. Initial DEX Offering Token Allocation
image

  • Treasury: 10%
    A treasury fund is an essential aspect of tokenomics. It provides a reserve of tokens that can be used to fund future development or to provide liquidity on exchanges.
  • Development: 5%
    This includes funds for ongoing development, maintenance, and improvement of the project. These expenses include salaries for developers, server costs, and any other expenses that are directly related to the development of the project.
  • Marketing: 5%
    Marketing is essential to attracting new investors and building community support. This category includes funds for advertising, community management, public relations, and other promotional activities.
  • Team: 5%
    This category includes funds allocated to the project’s core team members. This allocation could be distributed as a salary or as equity in the project.
  • Advisors: 5%
    Advisors can provide valuable insights and connections to help the project succeed. This category includes funds for paying advisors or providing them with equity in the project.
  • Initial Liquidity Offering: 70%
    The initial liquidity offering is the number of tokens allocated for the initial public sale. This category is critical to ensure a fair distribution of tokens to early investors and supporters.

7. Membership Structure
Anu Initiative will have two groups of DAO citizens:

Core Members - Directors and Members of Anu Initiative CLG that are responsible for the day-to-day management of the organization.

Members - Holders of Anu Tokens are citizens of our DAO community with voting rights and decision-making power.

7-1. Core Members
Core Members are responsible for managing the operations of Anu Initiative. They represent the legal entity Anu Initiative CLG, and they are responsible for developing and executing strategies and overseeing the organization’s day-to-day operations.

Vetting Impact Partners – As required by applicable legislation (i.e. Virtual Asset Service Provider), funds can be provided only to companies that pass the Anti-Money Laundering and the Counter Terrorism Financing screenings. Core Members liaise with professional service firms to perform required screenings before enrolling organizations as Impact Partners, as per AML and CTF regulations.

Operational matters – Core Members are responsible for deciding on operational matters, such as hiring new team members, deciding on partnerships, and making any other necessary decisions to keep Anu Initiative DAO running smoothly in pursuit of its mission.

Create proposals – Create proposals in one of the following categories:

  • Impact - Air/Fire/Aether/Water/Earth (Reference: fig. 1)
    Impacts such as trees planted, tons of plastic removed from the ocean, pupils receiving ecology education, area of protected land etc. will be negotiated with Impact Partners proposed by the DAO community and taken through the AML/CTF screenings. DAO Development/Policy (Reference: fig. 2)
  • DAO - Once the Smart Contract is deployed on the main-net, changes to it can only be done via the DAO changes process (Reference: fig. 2)

Treasury Management – Core Members are responsible for allocating funds to different environmental charities, based on what the community democratically decides. All transactions and associated fees will be posted publicly by Core Members and Impact Partners in the DAO decision work-flow’s last step called Proof-of-Doing, after which the Proposal gets archived.

Veto – Core Members have “veto” power on proposals that passed the DAO voting system maliciously or decisions that may be damaging to Anu Initiative CLG.

7-2. Members

Members are individuals who hold Anu Tokens, which give them voting rights and decision-making power.

Treasury Management – Members have voting rights on funding ecological initiatives, and also have the right to vote on allocating funds for developing the DAO. In short, any funds taken from the Treasury for generating a positive ecological impact, or for the development and operations of Anu Initiative CLG, will require approval from the DAO Members.

Selection of Impact Partners – Members can *propose and vote on enrolling new environmental charities. Core Members then use independent professional services firms to perform required vetting for the new partner.

Ban Impact Partner – Members can propose and vote on blacklisting an Impact Partner from the vetted list as a result of not completing the work agreed, or if proof-of-doing is not in line with the contract signed between Anu Initiative CLG and Impact Partner.

7-3. Code of Conduct

8. Voting Rights

The Anu Initiative DAO governance model and systems are designed to ensure the following:

Transparency – The voting system is transparent, allowing all members to see the voting results and the reasoning behind the decision-making process.

Security – The voting system is secure to prevent any malicious attacks, fraud, or manipulation of the voting process.

Accessibility – The voting system is accessible to all members and allows them to vote easily and efficiently.

Fairness – The voting system ensures that all members have an equal opportunity to vote.

Flexibility – The voting system is flexible and adaptable to accommodate different types of decisions, quorum requirements, voting periods, and other parameters specific to the Anu Initiative DAO.

Participation – The voting system encourages participation and engagement from all members, by providing relevant information, incentives, and feedback mechanisms to help them make informed decisions.

8-1. Initial Voting Rights Setup

Due to the prohibitive cost of implementing a Know-Your-Customer (KYC) functionality to validate the identity of each wallet holder and ensure each human has one vote, this will be the initial voting rights setup.

1 token = 1 vote, an individual’s voting power is directly proportional to the number of tokens they hold. So, if a token holder has 2% of all tokens, they have 2% of the total available voting power. Voting rights can be delegated to other Members.

8-1-1. Advantages

Equates voting power to how financially invested Members are in the DAO – The more tokens you have, the more invested you are in the DAO’s success, and the more voting power you have.

Proportional voting is conceptually easy to understand.

Relatively sybil-resistant – In contrast to wallet-based voting, token voting does not fall into the “sybil-attack problem” where, if contributors don’t link their identities to a wallet, one person can hold multiple empty wallets, each with a vote without token ownership.

8-1-2. Limitations

Plutocracy problem – In DAOs with an uneven distribution of tokens, the large token holders control the vote, whereas small token holders have little say. These smaller token holders may feel lower motivation to participate. And, the larger token holders might not vote in the best interest of the smaller token holders, or be missing context that the small token holders have. This will be addressed in a future iteration of the DAO by implementing a Know-Your-Customer (KYC) system.

Dark DAOs problem – Since votes can be purchased, this may open the DAO up to risks of votes being manipulated, such as an individual or group buying tokens in order to pass a proposal that breaches the Code of Conduct. This will be addressed by allowing Core Members to veto malicious proposals.

*8-2. Proposal Rights Gating

For enhanced DAO security and manipulation risk reduction, if evidence of manipulation or proposal spam is identified, Core Members will further gate proposal creation rights, based on the following criteria:

Minimum Tokens Owned – Only people who hold a certain number of Anu Tokens may vote within the DAO. Voting power can be delegated to any DAO citizen.

Loyal Members – Such as those who held tokens for more than one month.

9. Ideal Voting Rights Setup

An ideal voting rights setup for Anu Initiative DAO would be to give all members equal voting rights, with the requirement of KYC and one wallet one vote. The reasons for this are:

Equal voting rights – All members of the DAO should have an equal say in the decision-making process. This ensures that the DAO is truly democratic and that every member’s opinion is valued equally.

One wallet one vote – This ensures that each member can only vote once, which helps to prevent vote manipulation and ensures a fair and transparent decision-making process.

KYC is important to prevent fraud and ensure that all members are who they say they are. It also ensures compliance with local regulations and reduces the risk of legal issues. KYC can also help prevent malicious actors from joining the DAO.

Overall, implementing equal voting rights with KYC and one wallet one vote is the best option for the Anu Initiative DAO as it promotes transparency, fairness, and democracy.

10. Supporting documentation

Process for proposing Impact Proposals. (fig. 1)

Process for proposing DAO changes. (fig. 2)

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