Establish a Public Delegate Platform and Delegate Incentivization Program

Proposals
81

Delegate Insentivization Program 2.0

TL;DR

This proposal seeks DAO approval to make the Delegate Incentivization Program a standing governance mechanism, funded under the approved 2026 EGG request, with no additional funding required. The proposed program auto-renews annually, pays delegates in USD-denominated stablecoins, removes gas reimbursements, and migrates the operational and payment rails to the Lido Labs Foundation. This extension does not introduce any additional funding for 2026.

Motivation

This proposal extends the previous Delegate Incentivization Program (DIP) as a permanent governance mechanism, supporting expert, long-term-aligned delegates trusted by LDO holders, unless and until Lido DAO explicitly decides the program is no longer needed.

Today, 31M LDO are delegated on Aragon (source), part of that delegated to public delegates. Delegates participate in nearly 100% of votes, review on-chain proposals, track governance timelines, provide structured feedback to contributors, and actively represent Lido DAO interests across public channels.

This group forms an important layer of Lido DAO’s decision-making process. Preserving its capacity, continuity, and sustainability is critical for:

  • stable quorum formation,
  • predictable governance outcomes,
  • reliable contribution of delegated LDO to governance decisions,
  • scalable delegation growth without sacrificing decision quality.

The last year of the program demonstrated that delegate incentivization materially improves governance reliability, with every quorum achieved involving active delegate participation. DIP 2.0 transitions the program from a time-bound experiment into a durable DAO primitive.

Scope of Changes

DIP 2.0 introduces the following updates:

  • The program is open-ended and remains active unless and until Lido DAO decides otherwise. The DAO may terminate, pause, or modify the program at any time via governance, including by discontinuing or not renewing its funding.
  • 2026 Program funding moves under the 2026 Ecosystem Grant gRequest.
  • Budget requests are handled via the standard annual EGG process going forward.
  • To be eligible for compensation delegate should hold ≥1M LDO delegated on both Snapshot and Aragon (with the two quarter transition period).
  • Compensation switches from LDO (TWAP) to USD-denominated stablecoins, to improve budgeting predictability and reduce short-term volatility, while long-term alignment is maintained through delegated LDO.
  • Eligibility snapshot timing updated: delegation snapshots now occur on the 15th day of the middle month of each quarter, replacing the pilot’s 1st-day snapshot
  • Gas reimbursement is discontinued due to significantly lower Ethereum transaction costs.
  • Agora no longer participates in the committee.
  • Qualitative reporting simplified; focus shifts to direct monitoring and intervention.

Program Conditions

  • Total 2026 annual budget (stays unchanged): up to $300,000(, determined and approved as part of the annual grant request to the Foundation.
  • Quarterly cap for 2026: up to $75,000, representing one quarter of the approved annual budget.
  • Future-year budgets: the annual budget for each subsequent year will be defined and approved at the time of the corresponding grant request (EGG).
  • Maximum compensation per delegate: $15,000 per quarter.
  • Distribution model: All eligible delegates receive equal portions of the quarterly pool.

Eligibility and Merit-Based Criteria

To qualify for incentives in a given quarter, a delegate must:

  • Hold ≥1M LDO delegated on both Snapshot and Aragon.

    Eligibility Snapshot date: 15th day of the middle month of each quarter

    (February, May, August, November).

    Transition period: Given that the current program required delegation on only one platform, the Snapshot or Aragon requirement will remain in effect for Q1 and Q2 2026. Starting from Q3 2026, delegation on both Snapshot and Aragon will be required.

  • Be the first delegate selected by a delegator address in a quarter: delegated LDO from an address counts toward the ≥1M threshold only for the first delegate in a quarter, as an anti-sybil measure, if multiple delegations are made.

  • Participate in ≥70% of all votes during the quarter.

  • Maintain an active public delegate thread, including:

    • vote rationales,
    • feedback,
    • participation in proposal discussions,
    • on-chain votes verification.

Qualitative Oversight

Based on last year’s experience, the committee concluded that formal qualitative scoring has become low-signal and repetitive.

Changes in DIP 2.0:

  • Quarterly qualitative reports are removed.
  • The Delegate Oversight Committee monitors delegate behavior continuously.
  • Issues are addressed directly with delegates.
  • Persistent problems may result in removal from the incentivization program, subject to a decision of the committee.

Delegates and community members are encouraged to flag concerns to support accountability.

Program Process and Timeline

  • Eligibility snapshot: at the 15th day of the middle month of each quarter

(February, May, August, November).

  • Quantitative performance review (Voting Power, participation, reasoning): conducted at quarter end.

  • Incentive distribution:

    executed during the following quarter, after publication of:

    • voting participation,
    • eligibility confirmation,
    • equalized payout calculation.

Operational Rails and Execution

The Delegate Incentivization Program operates as a grant-based program, which Delegate Oversight Committee multisig has been adopted by the Lido Labs Foundation, following Lido DAO approval (see here).

Therefore, funding and execution of the program will follow and be subject to Lido Labs Foundation’s standard payment procedures, including applicable sanctions and AML checks. No individual agreements with delegates are required. Participation in the program and fulfillment of the published eligibility criteria are sufficient to qualify for incentive distribution, which payment is then subject to the above mentioned checks.

No changes to delegate-facing requirements, eligibility criteria, or incentive structure result from this transition.

Delegate Oversight Committee

The Delegate Oversight Committee consists of members from the

Lido DAO Contributors Group.

External facilitation (e.g., Agora) was valuable in the early stages but is no longer required for a mature, ongoing program.
Committee composition:
Rotate:
Charlie to @Kate_Alekseeva
Marcela to @nikita.p
Keep the current 3/5 setup.

Committee Responsibilities

  • Maintain the public delegate registry.
  • Determining delegate eligibility based on the approved criteria,
  • Publish quarterly transparency reports.
  • Submitting the list of eligible wallet addresses for payout,
  • Coordinating with Lido Foundations to execute distributions under established internal procedures.
  • Address delegate performance issues when required.

Summary

  • The program auto-renews every year.
  • DIP 2.0 is funded under the existing 2026 grant request.
  • No additional funding approval for 2026 is required.
  • Parameter changes or program termination require a dedicated DAO vote.
  • Annual funding will be proposed as part of the EGG proposal each year.
  • Eligibility snapshot timing updated: delegation snapshots now occur on the 15th day of the middle month of each quarter, replacing the pilot’s 1st-day snapshot
  • Gas reimbursement is discontinued due to significantly lower Ethereum transaction costs.
  • Agora no longer participates in the committee.
  • Qualitative reporting simplified; focus shifts to direct monitoring and intervention.

Next Steps

Snapshot vote: this proposal will be submitted to a Snapshot vote for Lido DAO approval.

Program continuation: if approved, DIP 2.0 switches to the updated mandate without interruption.

Reporting: the Delegate Oversight Committee will report on a recurring quarterly cadence in accordance with the program.

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