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    "comment": "DRep Voting Rationale: Protocol Parameter Change to reduce treasuryCut from 20% to 10%\n\nCriteria\n\nI assess proposed governance actions in light of the Constitution and my DRep objectives. Because I assess this proposal does not meet requirements of the former, I do not proceed to apply the latter in depth. The burden of proof lies with the proposer of an action, and I assess that which they submit in the action.\n\nDecision\n\nFor the reasons explored below — insufficient rationale to justify the requested change and lack of sufficient technical review and scrutiny — I vote no on this action.\n\nI seek to provide constructive criticism, and these critiques are not personal — they are offered for broader consideration as we explore governance action drafting as a community.\n\nI thank the proposer(s) for endeavoring to advance the cited goals of economic sustainability and long-term ecosystem growth, and I remain open to considering future proposals on this topic.\n\nThe Proposal Does Not Sufficiently Justify The Requested Change (Art. III, § 5, ¶ 1)\n\nConstruction\n\nArt. III, § 5, ¶ 1, provides two interrelated requirements for proposed governance actions:\n\n“Sufficient rationale shall be provided to justify the requested change to the Cardano Blockchain. The rationale shall include, at a minimum, a title, abstract, reason for the proposal, and relevant supporting materials.”\n\nTo apply these two requirements, I must first distinguish necessary from sufficient conditions. A necessary condition must be satisfied to result in an outcome, but its satisfaction does not guarantee that outcome. In comparison, a sufficient condition, if satisfied, guarantees that outcome. \n\nHere, a rationale with “at a minimum, a title, abstract, reason for the proposal, and relevant supporting materials” is a necessary — but not sufficient — condition to satisfy the “sufficient rationale…to justify the requested change to the Cardano Blockchain” requirement.\n\nCritically, I must avoid the fallacy of affirming the consequent — improperly concluding the “sufficient rationale” requirement is met because: 1.) a “sufficient rationale” requires “a title, abstract, reason for the proposal, and relevant supporting materials,” and 2.) those minimum elements are present here.\n\nThus, while this proposal includes “a title, abstract, reason for the proposal, and relevant supporting materials,” the question of whether the rationale justifies the proposed change to the Cardano Blockchain remains, which I assess next. \n\nBarriers to the Rationale Sufficiently Justifying the Requested Change\n\nAssertions without sufficient substantiation\n\nFor a governance action rationale to sufficiently justify the requested change to the Cardano Blockchain, assertions must be supported by data, research, facts, logical arguments, or some other form of evidence.  \nOne assertion in this action — that implementation would increase staking incentives — includes relevant evidence in the Mathematical Justification section. There, the change is integrated with a relevant overview of the treasuryCut parameter and Cardano’s staking rewards system.\n\nUnfortunately, many other assertions of the proposal are not supported by sufficient data, research, facts, logical arguments, or some other form of evidence. This isn't to say these assertions cannot be proved, only that the rationale as submitted does not sufficiently do so.\n\nExamples include unsubstantiated assertions that implementing the action would: improve decentralization, increase security, align economic sustainability with the Cardano ecosystem's long term growth, ensure a balanced economic model that incentivizes participation and network security, encourage broader participation, strengthen security while maintaining a sustainable treasury, result in a leaner treasury encouraging competitive grant proposals and more strategic allocation of resources, and others.\n\nAs a result, the proposal has recurring instances of circular reasoning where the proposal assumes its own unproven assertions as evidence for its conclusions. For example, the assertion “This proposal should be justified by Cardano's staking participation rates, treasury utilization, and historical transaction volume” (Justification Based on Cardano’s Economic Landscape section) begs the question — assuming its own unproven assertions as evidence for its conclusion. Sufficient data, research, facts, logical arguments, or some other form of evidence must establish how and why staking participation rates, treasury utilization, and historical transaction volume justify the requested change. \n\nAssertions susceptible to misinterpretation - arbitrary initial settings\n\nIn three sections of the proposal — Motivation, Referencing Constitutional Guardrails, and Benefits to the Ecosystem — a common pattern of assertions is offered: 1.) that “the initial 20% treasury cut was set arbitrarily at the launch of Shelley and has never been reassessed,” 2.) that Cardano is more mature now, and 3.) insufficiently supported assertions about positive effects of the proposal. \n\nThis pattern of assertions could be interpreted to infer a rule not found in the Constitution — that decreased levels of justification and scrutiny apply to Protocol Parameter Change actions if the initial value is asserted to have been set arbitrarily. Notwithstanding conflicts with Art. III, § 5, ¶ 3 and other requirements, adopting this rule would only exacerbate the very problem implicit to its premise — that setting parameter values without sufficient justification is adverse to the interests of Cardano. The Referencing Constitutional Guardrails section asserts the initial setting was “not based on economic modeling or sustainability projections but rather as a starting point in the early phases of the network.” This is offered in contrast to our “more mature ecosystem,” which in turn supports the conclusion that we should justify parameter changes utilizing such evidence, not present in this proposal. \n\nAssertions susceptible to misinterpretation - guardrail bounds\n\nThe proposal’s Constitutional Alignment section, referencing Appendix I, Section 2.2, TC-01 and TC-02, asserts “The new constitution explicitly permits treasury cuts between 10% and 30%,” then notes “This governance action remains within those limits.”\n\nIt’s critical to note that compliance with the delimited bounds of pertinent guardrail values is a necessary — not sufficient — condition for proposal justification. Protocol Parameter Change actions must comply with applicable guardrails, provide substantive justification for the specific change being proposed (Art. III, § 5, ¶ 1), undergo sufficient technical review and scrutiny (Art. III, § 5, ¶ 3), and comply with other Constitutional requirements.\n\nIf guardrail range compliance was treated as sufficient justification, consistent application would lead to untenable results. As Appendix I notes, “Not all parameters for the Cardano Blockchain can be considered independently. Some parameters interact with other settings in an intrinsic way. Where known, these interactions are addressed in this Appendix.” For Economic Parameters, including treasuryCut, “Changes to the economic parameters should not be made in isolation…They need to account for external economic factors (and) network security concerns” (Appendix I, § 2.2). Because not all combinations of intrinsic parameter contraindications are known, let alone in conjunction with the compounding effects of extrinsic conditions, each proposed Protocol Parameter Change action should be evaluated individually based on intrinsic and extrinsic conditions then in existence pursuant to the requirements of Art. 3, § 5, ¶¶ 1-3.\n\nLack of methodology and narrow scope of consideration\n\nThe action proposes a reduction of the treasuryCut parameter from 0.2 (20%) to 0.1 (10%). Unfortunately, it omits the methodology and reasoning underlying the chosen value. While the Ensuring Continuity and Preventing Disruptions section posits a beneficial idea — that a “structured review mechanism can be introduced to assess (the parameter change) impact over time and make future adjustments if needed” — the possibility of implementing such measures later does not justify the proposal’s lack of prospective impact analysis now. \n\nOverall, the proposal focuses primarily on reiterating asserted yet unsubstantiated benefits of the change. This narrow scope leaves consideration of first and following-order effects on the treasury — critical to long-term viability — insufficiently explored. No opportunity cost analysis compares the utility of the pertinent funds through each channel, staking rewards versus treasury utilization, and corresponding identification and possible mitigation of drawbacks are absent.\n\nThe Proposal Lacks Sufficient Technical Review and Scrutiny (Art. III, § 5, ¶ 3)\n\nUnder Article III, § 5, ¶ 3:\n\n“...Protocol Parameter Change governance actions shall undergo sufficient technical review and scrutiny as mandated by the Guardrails to ensure that the governance action does not endanger the security, functionality, performance or long-term sustainability of the Cardano Blockchain. \n\nUnder Appendix I, § 2.2, changes to Economic Parameters including treasuryCut, “ should not be made in isolation…They need to account for external economic factors and network security concerns.”\n\nWhile the proposal asserts in the Review and Governance Compliance section that it “incorporates economic impact analysis”, this is not apparent. If this references the Referencing Constitutional Guardrails section, the analysis narrowly posits treasury viability as a function of undefined ADA price appreciation — an unsupported assumption that excludes alternative possibilities of stagnation, decrease, or increases below the undefined increase the argumentation assumes.\n\nDRep Ken Ladd: drep1ygkfv2u7aazrfhqgh0qssramjd6av09rsh3ejd0rd95cmusezderl"
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