At the end of 2024, we want to review some highlights from last year with the community and share key points about the future of Internet Computer governance in 2025.
In this three-part series, we will reveal key technical achievements, governance principles of the NNS DAO that manages ICP, and the SNS DAOs that govern individual dapps, as well as updates on technological roadmap milestones.
If you missed the first blog in this series, you can find it here: Governance on ICP in 2024: Part One - Highlights
Without further ado, let’s continue this series and take a look at the SNS or Service Nervous System of the Internet Computer.
Highlights of SNS DAOs on ICP
In the fast-evolving world of blockchain and decentralized applications (dapps), the Service Nervous System (SNS) is becoming a key component of the Internet Computer Protocol (ICP).
SNS is a decentralized autonomous organization (DAO) provided by the Internet Computer platform, allowing dapps to achieve decentralization through a built-in launch process that raises initial funding for the project and transfers ownership of the dapp to the community. The SNS DAO community then has full control over the development of the dapp, including key decisions such as token economics, upgrades, and project direction.
2024 marks a significant transformation for SNS.
In 2023, the focus of SNS on ICP was on simplifying SNS launches. Following these improvements, the launch process has been refined and runs smoothly, as evidenced by the 14 SNS launched at the end of 2023 and an additional 16 SNS launched in December 2024 (for more details, see Part 1).
Therefore, the focus in 2024 shifts to providing the tools necessary for the success of launched SNS, including enhanced security features, streamlined operations, greater branding flexibility, and initiatives to unite different SNS communities.
Let’s take a closer look at some key developments in 2024!
Enhancing security: Protecting treasury funds
Security is a top priority for many SNS communities, especially considering that some communities faced sudden large transfers from the SNS treasury at the end of 2023. To address this, the community agreed to implement new measures to make treasury liquidity and operations of other SNS DAOs more robust.
Therefore, the concept of key proposals was introduced, which includes treasury proposals, as well as proposals for minting new SNS tokens and deregistering container smart contracts controlled by SNS DAOs.
These improvements were proposed after lively discussions within the ICP community, including valuable feedback from different SNS DAOs regarding which measures might assist or negatively impact daily DAO operations. These changes were implemented and adopted by the NNS (Network Nervous System) in multiple releases during the first quarter of 2024.
Major changes to key proposals include:
Increased voting thresholds: General proposals now require 50% 'yes' votes to pass, whereas key proposals now require 67% 'yes' votes to pass, ensuring stronger consensus on significant decisions.
Removing key proposals from the 'all coverage' watchlist: SNS implements fluid democracy, allowing participants to delegate their voting rights to others, called 'following.' The watchlist can be selected based on proposal types. To follow the same entity for all types of proposals, participants can opt for a special following option called 'all coverage,' which applies the same rules to all proposal types. This measure excludes key proposals from this all coverage list, forcing participants to actively decide who to delegate their votes on key decisions, thus compelling participants to make separate, clear decisions on these important proposals.
Longer voting periods: The voting period for key proposals has been extended to 5-10 days (compared to 4-8 days for regular proposals), providing more time for community participation and discussion.
Funding transfer restrictions: There is now a limit on the amount of ICP and SNS tokens that can be withdrawn from the treasury within a week. This change ensures that any large withdrawals from the treasury undergo stricter scrutiny and control, preventing sudden outflows of funds that could jeopardize the long-term viability of the project.
Additionally, improvements were made to the NNS frontend dapp to help users identify and vote on key proposals:
Allow users to filter SNS proposals by type - this can help SNS voters find relevant proposals if they decide to actively vote on key proposals.
Display all open proposals that users can vote on for SNS DAOs on a summary page, enabling users to quickly find where they can still vote.
Empowering communities with flexibility: Token rebranding
In SNS and in Web3, tokens associated with projects are not just governance tokens and digital assets; they are a crucial part of project identity and community. Moreover, for decentralized projects, having the right brand is essential for building trust, recognition, and strong relationships with users.
Therefore, one of the most anticipated updates of the SNS framework is the ability to redefine the token symbol, token logo, and token name of SNS DAOs through governance proposals.
Previously, SNS could only change the name and logo of SNS projects in the SNS settings. With the new proposal feature, the community can now formally rebrand its token, allowing the SNS DAO community to adapt to trends and redefine their vision for the project. SNS projects can refresh their image, create a more recognizable brand, and attract audiences more effectively.
This change was introduced in May 2024, and shortly thereafter, several SNS DAOs utilized this change to rebrand their projects, including the following projects:
SNS-1 became Dragginz
Hot or Not became Yral
Modclub became Decide AI
This rebranding is an exciting advancement, making SNS more adaptive and community-oriented.
Minimizing operational burden: Simpler SNS framework upgrades
Keeping SNS updated is crucial for ensuring its security, functionality, and alignment with the latest features and improvements. Each SNS DAO consists of multiple container smart contracts defined by the SNS framework, which are regularly upgraded with new features and security enhancements. Thus, the Network Nervous System (NNS) approves new versions of each container in the framework (governance, ledger...) and releases them.
Then, each SNS is responsible for pulling the next available upgrade, which, until fall 2024, was a manual and thus cumbersome process for SNS communities.
A proposal called 'UpgradeSnsToNextVersion' only upgrades a single SNS container, thus requiring many proposals to update all containers in the SNS. Consequently, SNS often lags behind many versions, risking running outdated versions with bugs.
In December 2024, a new proposal type called 'AdvanceSnsTargetVersion' was introduced to simplify SNS upgrades, allowing the SNS community to submit a single proposal to upgrade to the latest version, thus automating the process of cross-container application upgrades. SNS now handles upgrades in the background, ensuring that they are completed in the correct order without the need for additional proposals.
This change reduces errors caused by coordinating multiple proposals and decreases the manual work required by the SNS community. It makes it easier for teams to keep up with necessary updates and focus on the growth and development of the community. This proposal was welcomed by the SNS community as it significantly simplified their daily operations and ensured that SNS is more likely to stay up to date.
Bringing SNS communities together: ICP Labs and DAO Circle
One highlight of 2024 is observing increased collaboration between SNS communities, as they recognize the value of gathering in a unified space to exchange experiences, share knowledge, and tools.
Notably, various different activities and initiatives took place throughout the year:
In August 2024, members from 13 DAO communities gathered at the DFINITY headquarters during the ICP Labs DAO, where they engaged in collaborative discussions focused primarily on token utility and governance best practices. Many teams see their tokens as the main marketing tool for their projects, and different SNS DAOs established new partnerships while gaining valuable feedback about their products.
A key example of maturity and collaboration between SNS DAOs and other projects is that many SNS DAOs utilize community-built tools for operations simplification or monitoring, including some notable tools:
SNS geek: A comprehensive tool that provides an overview of all SNS, helping users track each SNS.
Cycle ops: A tool for managing the cycle consumption of containers (including SNS framework containers), which are crucial for running smart contracts on the Internet Computer. This tool helps SNS manage its cycles and avoid product unavailability due to cycle depletion of underlying containers.
Toolkit: A user-friendly tool that simplifies the process of submitting proposals, allowing users to participate in the governance system without using a command line interface, making governance more accessible to a broader audience.
Tally Bot: A tool for tracking proposals and governance participants' votes, providing real-time insights into governance activities.
SNS Tracker by ICHouse Explore: A tracker providing detailed data about SNS DAOs, helping users analyze key metrics.
ICSNS-Neurons: One of the first platforms allowing non-technical users to create SNS proposals directly from a web browser.
The SNS DAO community participated in the launch of other projects' SNS for the first time, contributing not only expertise but also resources to help new projects succeed. This mutual support further highlights the strong sense of community within the SNS ecosystem.
Interest in SNS is growing, and the community is dedicated to ensuring the security and utility of these projects, which is also reflected in the increasing engagement of groups like Codegov, which has started actively reviewing proposals on different SNS to help ensure the integrity of the governance process and share insights beneficial to the entire community.
In October 2024, with the creation of the DAO Circle on OpenChat, a sense of community unity was fostered. This platform aims to be a space where all SNS DAO members can discuss new features, governance practices, DAO-related events, and exchange tools.
These efforts demonstrate the growing strength and unity of the SNS DAO community, as teams not only share knowledge but also actively collaborate to drive the long-term success of the Internet Computer ecosystem.
What’s next?
In 2024, improvements in operational issues, enhanced security, and initiatives to bring together different SNS DAO communities laid the groundwork for greater success of SNS.
By 2025, we plan to continue investing in this work, such as making it easier for the SNS community to handle regular upgrades of SNS framework containers.
Additionally, a major focus for 2025 may be helping various SNS DAOs cultivate thriving communities, with one key factor being making it easier for users to participate in SNS governance. For example, by introducing proposal topics (grouping multiple proposals) and naming neurons (easily identified to delegate voting rights), fluid democracy can be more easily achieved.
We look forward to discussing these and new features with the ICP community, and seeing how different SNS DAOs evolve in the new year!
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On Friday, January 24, welcome to the third part of ICP governance highlights.
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