ADR 006: Community tax
This is the suggested template to be used for ADRs on the cheqd-node project.
Status
| Category | Status |
|---|---|
Authors | Alexandr Kolesov |
ADR Stage | ACCEPTED |
Implementation Status | Implemented |
Start Date | 2021-09-08 |
Summary
The aim of this ADR is to define how "community tax" as described in the Cosmos blockchain framework will work on cheqd network.
Context
What is "community tax"?
communityTax is a value set in genesis for each Cosmos network and defined as a percentage that is applied to the fees collected in each block.
Tokens collected through this process accumulate in the community pool. The percentage charged as communityTax can be changed by making proposals on the network and voting for acceptance by the network.
Community tax collection
From Cosmos SDK documentation, distribution module:
The community pool gets
community_tax * fees, plus any remaining dust after validators get their rewards that are always rounded down to the nearest integer value.
Community tax distribution
To spend tokens from the community pool:
community-pool-spendproposal can be submitted on the network.Recipient address and amount of tokens should be specified.
The purpose for which the requested community pools tokens will be spent should be described.
If proposal is approved using the voting process, the recipient address specified will receive the requested tokens.
The expectation on the recipient is that they spend the tokens for the purpose specified in their proposal.
More information about fee distribution is available in the End Block section of Cosmos's distribution module documentation.
Decision
cheqd's network will keep the
communityTaxparameter enabled, i.e., non-zero.The value of
communityTax, based on a review of similar Cosmos networks will be set to2%.
Consequences
Backward Compatibility
The behavior of
communityTaxis the across Cosmos SDK v0.42 and v0.43.
Positive
The cheqd network will have a pool of tokens that can be used to spend on initiatives valued by the community.
Negative
N/A
Neutral
cheqd's Governance Framework should provide guidance on how to submit proposals and recommended areas of investment in community efforts.
References
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