Partial list. Full dataset available on request.
Our mission is to ‘create a tokenized world where value can flow freely’. We built a protocol for peer-to-peer exchange of tokenized assets. Our KPIs are on tokenized value asset exchanged (volume), users exchanging value, and network value (heuristic: protocol fee collected). They are summarized here: https://0xtracker.com/network-insights
0x Labs (source) was the team appointed in 2017 to create the protocol and the tooling necessary to bootstrap the ecosystem.
Users of the protocol are users of Ethereum applications, owners of self-hosted wallets. For what concerns the governance of the protocol, anyone can participate. Proposals are voted on ZRX Portal (link) and implemented based on vote result. One token, one vote, 50%+1 is a pass. Voting power is determined via ownership of ZRX tokens (ERC20 token issued on Ethereum blockchain). One token, one vote. ZRX tokens were distributed in 2017 (link).
It’s important to distinguish the code that regulates the 0x protocol itself VS the governance of the protocol.
- The code formalizes two key figures: the order maker and order taker. The order is the protocol standard: a message signed by both parties that represents the exchange details. The sequence of actions is the follow
- Maker address signs an order that formalizes what asset is desired, what asset is being exchanged with, and their quantities (their ratio will determine the price). Other optional parameters can be set
- The order is distributed off-chain through different channels (could be email, aggregated orderbook or other services run by 3rd parties)
- The order is signed by a taker that is willing the settle the exchange. The order is sent to 0x smart contracts, that perform the atomic exchange between maker and taker.
The smart contracts regulating the exchange of assets can be upgraded. They are upgraded following the results of proposal votes on the ZRX Portal (link). In order to favor the redistribution of token ownership towards ecosystem participant, in 2019 it was introduced a staking system that simultaneously rewards professional Makers (Market Makers, similar to the institutions active in traditional capital markets) for their activity with monetary rewards and voting power. The results of it is that Market Makers, being 0x users that have skin in the game, have more control over decisions on the protocol itself (see 2020 votes recap here, slide 16). Further details of the staking system can be found here and here.
Goals and Implementation
Ultimately, the project has the goal to introduce a global, censorship-free and efficient vehicle for exchange of tokenized assets. To preserve its openness, it is necessary to promote and sustain the progressive decentralization of the governance of the protocol by actors and entities that have vested interest in the its success.
The delegation mechanics introduced in 2019 allowed to increase the number of ZRX token holders indirectly involved in the votes. See slide 16.
As part of the tokensale, a 15% of the proceeds were allocated in a Ecosystem Development Fund. This fund has been used to fund efforts aimed at growing the 0x ecosystem in areas where the 0x bootstrap team didn’t have resources or focus to address. An example of such a project is 0xTracker (a data anlalytics website faced on 0x), bug bounties, Market Maker program and other bounties advertised in the gitcoin platform. In 2021, the project is planning to introduce a community-owned treasury funded via the ecosystem fund
Currently, the voting system is administered by 0x Labs. The team has the power to pick proposals that are put up to vote, and collects the vote tally. So far, no other entities other than 0x Labs has pushed for a proposal to be put up for vote. 0x Labs is planning to introduce in 2021 an onchain binding system (similar to Compound, Uniswap). In this system, 0x Labs would not retain special powers in the administration of updates and votes. See the governance roadmap here.
No entity has control on what proposals are introduced and discussed. Proposals are discussed in the forum and collected in the ZEIP (ZeroEx Improvement Proposal) repository. They are also discussed in monthly developer and governance calls.
As per 10, the executive power currently resides in the 0x Labs team via multi-sig wallets (documentation). It is planned to switch the model to an onchain binding system (like Compound’s).
There is no mechanism in place. Once the update is deployed, it can be rolled back with another proposal.
Nothing formal. There are discussions on the Discord channels, on the forum, and directly in the ZEIP proposals.
The latest version of the protocol will be implemented with a proxy architecture that will allow for easier upgrades, without having to change the access to the protocol. This will allow to introduce changes to the protocol with more agility and without introducing breaking changes in the ecosystem.
As described in 10 and 12, 0x Labs is planning to remove the Governor codebase in exchange of an onchain binding system that removes all the control of the protocol from the 0x Labs team. This was planned since the inception of the protocol (1 2), and we followed the progressive decentralization playbook, that is prioritizing the utility of the protocol making compromises with its initial decentralization.