Formal Inquiry of Daniele Sestagalli
There was an AMA held with Daniele and Team on August 24th discussing this list in detail. Please listen to the call HERE and consider his responses from that call as well.
A Summary of the AMA on Aug 24 can be read HERE
With the information gathered throughout the AMA; an RFC is being constructed to consolidate this list where applicable and present standard operating procedures as well as commitments expected of Daniele if he wishes to maintain his position.
The purpose of this proposal is to formally request Daniele Sestagalli to provide insights into his rationale on varying concerns expressed by the community. A list of concerns was submitted by Wonderland Moderators to Daniele on August 9, 2022, after it was arranged with Daniele in a community call two days prior. Daniele supplied a list of answers for these concerns on August 21, 2022. As these responses are not adequate to resolve the concerns and additional concerns still linger, we believe the next best course of action is to involve the DAO in this process for complete transparency. The original list and Daniele’s responses are in This Attached Document. In order to move past these issues and dismantle concerns of repeat occurrences, it would be productive to discuss the following topics under the terms of a formal inquiry:
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Repeated pattern regarding lack of activity
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The Mystery Signer and CVX Delegation
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Following Governance
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Details of BetSwap deal & other agreements
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DAO Control over Multisig
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Treasury Council
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Professional Behavior
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Liquidation Refunds
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Abracadabra Bribes
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Abracadabra conflict of interest
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Abracadabra personal debt
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Personal stake in Wonderland
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Team Allocation
The following is a list of concerns for Daniele, with additional context and references to improve accuracy and transparency.
1. Repeated periods of extended absence
Over a period of the last 8 months, you exhibited multiple periods of extended absence. The longest and most recent examples of this behavior are May 22 - June 18 (26 days) and June 19 - July 20 (31 Days). A cursory search of your activity in the Wonderland Discord highlights a series of absences dating back to SifuGate.
You reference governance being in place to keep the protocol functioning in your absence; however, most of the governance that helps keep this protocol functioning in your absence was Created and Enacted in your absence and much was designed as a direct result of your absence. There are numerous occasions in which your absence has had direct negative consequences for the protocol.
To be frank, you have not expressed to the team or community that we are required to communicate with you through Telegram. In fact, on multiple occasions you Explicitly expressed to us that we should ping you in the discord. On May 2nd, you said, “Im going to start being active everyday now” … “So go ahead pinging me on here”. This soon after was followed by another period of you being absent.
The high majority of ping’s to you from moderators in both Internal and Public Discord channels go unanswered. The moderation team refuses to accept responsibility for not being able to post constant updates from the “technical team” as you call it, as there simply have been no updates on plans or changes provided to the moderators beforehand. In multiple cases, communication with managing members could only be established due to the help of Sifu reaching out to Georgiy.
Moderators have facilitated the growth of our governance framework without assistance or input from “team”. A moderator moderates; they are not responsible for developing risk profiles, doing due diligence, identity checks, developing feasibility reports, developing marketing plans, conducting public outreach on social media, or otherwise being involved in the process of management beyond moderating conversations - yet there is an implication that moderators should be doing so in your absence. Our Liquid Staking devs have also had to resort to communicating with our Moderation Team in order to keep progress moving. There has been No Team to take on these responsibilities for months, so moderators have done the Additional work of maintaining this organization, above and beyond their duties to “moderate discourse”. Attempting to place responsibility on moderators to be the protocol operators is unacceptable.
As a managing member, until a team has been put together through governance processes to handle many of the necessary functions of this organization - Your Consistent Involvement Is Required To Run This Protocol. It would be unacceptable for a founder and managing member of an organization to leave the structuring of foundational operations to the member support staff; they would be expected to foster the growth of the organization until the organization is capable of functioning with limited intervention - You have not met this expectation over the past 8 months. If you believe governance should be able to maintain the functionality of the protocol in your absence, you are expected to provide adequate involvement that meets the expectations of a managing founder, at least until we have constructed a team to handle the responsibilities of policy, marketing, compliance, operations, etc. to handle the areas of the protocol that require dedicated guidance. If you do not see yourself able to be involved as needed, please make this officially known so we can move on and organize ourselves, as we have been doing.
What level of consistent involvement should we expect from you over the next 6 months? What can we do to ensure that all managing members of this organization continue to maintain adequate levels of communication with the community, so as not to experience situations like this in the future? In order to be prepared for all outcomes; what course of action should we consider taking if we were to experience a managing member being inactive for an extended period of time? What should we consider to be an extended period of time in this context?
What immediate steps are we going to take to ensure the protocol can maintain effective functionality if this situation were to occur again in the future?
2. “Mystery Signer” - Address: 0x2d419804D07Ef4D20eC827F58cE535089c62cB47
The address above was added to the multisig without any communication or announcement to the community regarding the addition at that time. The community has still not received any information regarding this individual other than Daniele saying “Is part of the team Georgyi as usual”. This signer was removed from the Multisig after the community expressed discontent with this unknown individual approving 9 transactions (gnosis txn #162 through #171) to liquidate UST positions at Abra.
Throughout the duration of time this individual was on the Multisig, the address was not used to submit or approve any technical transactions that could not have been facilitated by our elected treasury manager and known Team. There is little concern that we have additional signers to keep things moving smoothly; the issue is that this signer is completely unknown and was added to the multisig without prior communication to the community regarding this change. Adequate information to feel comfortable with this individual approving trades worth 10’s of millions of dollars is unreasonably lacking. We received a paltry “works for georgiy” After this individual approved txns for 10’s of millions of dollars and the community expressed discontent with that arrangement.
In total; these are all Txns confirmed by this individual
January 28, 2022: Gnosis Txn #61, #62, #63, #64, #65, #66
January 31, 2022: Gnosis Txn #68
March 25, 2022: Gnosis Txn #93, #94, #95, #96, #97
April 13, 2022: Gnosis Txn #100
April 27, 2022: Gnosis Txn #101
April 28, 2022: Gnosis Txn #102
May 10, 2022: Gnosis Txn #162, #163, #164, #165, #166, #167, #168, #169, #170, #171, #173 (liquidations)
Previously, Sifu mentioned in the Discord that he was provided erroneous information in regards to the identity of this individual, he was told the individual was Squirrel. This adds to the concerns articulated in this list. As requested in the original section: Please provide more detail regarding how this individual is associated with Georgiy and this individual’s association with any other protocols.
This is a difficult situation to navigate as the information is extremely limited. This signer also used the CVX to vote for MIM pools through a delegation function, after they were removed from the Multisig - overriding our Treasury Manager’s direction. This action occurred in the final hours leading up to the locking deadline and was in direct violation of WIP 8, as this action was done behind Skyhopper’s back.
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What was the intent behind this direction?
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What can we do to ensure treasury personnel actions are not overridden without consent from respective elected personnel in the future?
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How can we ensure no changes to the Multisig will be made in the future without guidance from articles of governance or thorough community discourse?
Please answer the specific questions above.
3. Following Governance
Recently you have expressed a variety of intentions in regards to following governance. On a recent community call, at 11 minutes and 30 seconds in, you made the following statement:
“I think we need to expand the Wonderland brand as a community… more than just a DAO. Like, I want to transcend the DAO. I want to move away from, ‘We are just a DAO. We are Also DAO.’ Let’s say this; like DAO is a product of Wonderland, you know, but it’s not the only product. It’s a part of things that Wonderland does, but, which is an experiment as it is, right? Of direct governance, and massive treasury, and so on…”
Additionally, in a recent conversation on discord, you dictated this rule about the multisig:
“If treasurer gets on multisign” …“One of the new ones will have to be replaced by him”
The current interpretation of this statement is that you are requiring an elected member of the community be removed from the Multisig if a newly elected member is added. Would we not remove one of the unelected, unaffiliated associates of your’s instead? What would be the purpose of maintaining the unelected, unaffiliated individuals over the elected members?
Please provide an unambiguous clarification on your intention to strictly follow governance or not. If you believe it is flexible, to what degree do you feel it is flexible? One interpretation of the situation is that outside of an elected policy officer, governance is always adhered to, and governance is the only process that makes changes to the protocol and/or DAO; do you agree with that assessment? Yes or No?
4. Details of BetSwap investment and other deals - Was Not Included in Original List
There have been continuous requests from many members of the DAO for unambiguous information pertaining to the investment into BetSwap. The community has expressed a desire to close our BSGG LP, but we have received mixed responses on whether or not there may be an LP provision in our BetSwap Investment Agreement. Sifu has told the community on multiple occasions that there was no LP provision in the original agreement, and as recently as 08/20/2022 Sifu expressed to the community that he “Confirmed with betswap that we made no such agreement back then.” In the past, Skyhopper has mentioned that he inquired about closing the LP and informed the community “I was told WL would provide liquidity for 5-6mm a side on a liquidity pool as part of the BSGG investment agreement”… “this was conveyed to me by BSGG, while Dani was on the call”.
It is expected that some formal agreement was constructed prior to the deal being presented to the community in the Medium Article. Since the start of the investment, various parameters have been vaguely disclosed; like the duration of the airdrop and as mentioned above, the expectation of an LP maintained by wonderland for some duration of time. Please provide the Original Agreement that was constructed at the time the investment was made. Information in this agreement is expected to include, but should not be limited to, any conditions of the investment pertaining to Wonderland DAO maintaining an LP with BSGG for any duration of time. If an agreement was not documented, please provide All documentation pertaining to the terms of the Original Agreement; including audio recordings, emails, direct messages, group messages, and other forms of documented communication.
In addition, have any alterations to any definitions or terms of the original agreement changed since the investment was made? If so, what changes or additions were made and when were these changes decided? Please provide all available documentation to support these changes and the decision making process that went into confirming these changes.
5. Multisig
There is much concern that you are actively positioning the multisig to maintain unilateral control over the treasury through associates. What is your rationale in adding Vitalik to the Gnosis Multisig? You’d mentioned a need for a “technical person”, but this need was not apparent before the addition of the moderators, throughout Skyhopper’s tenure as TM and before. What provoked the need for that change at that time? What actions can we take to provide the community a sense of security on this specific concern, while also meeting the needs of your own concerns?
As mentioned above in #3; you dictated that an elected member must be removed from the Multisig if another elected member is added, yet there are multiple unelected associates of yours on the multisig already. What steps can we take to balance the multisig to include more known, elected members?
6. Multisig and treasury council
It has been expressed that the multisig is still not acting in an efficient manner. How should we expect the BSGG farm to be maintained in the immediate future? When should we expect the final requirements of WIP 14.1 to be executed? How can we ensure more efficient execution of treasury related DAO decisions moving forward?
In addition, the accountability and productivity of the treasury council is also an immediate concern. There are Technical Requirements within WIP 15 that call specifically for a Discord channel to be opened for the treasury council to analyze and vote on strategies before deployment. WIP 15 also calls for these council communications to be released to the community every quarter. The use of Telegram for this activity is in dispute, due to its lack of secure accounting for all messages. The current productivity of this council is also in dispute.
As for the public nature of discord; it is well known that all forms of digital communication are subject to unapproved disclosure. There is no App or Program that would provide any more semblance of confidentiality over another - all conversations can be screenshot and shared, or simply disclosed by word of mouth. Telegram suffers from an inherent security flaw; a member of the chat group can clear the chat history at any time. As Discord is The DAO’s main channel of discourse between the team, called for in previous governance articles, you have expressed you intend to adhere to governance, and Disord allows for more thorough accounting of official communication for the DAO; it is explicitly required that you follow governance on this matter and work with the team in a Discord Channel officially controlled by the DAO.
All executed transactions are indeed “on the blockchain”. However, internal discussions regarding the review and approval process of All proposed strategies are not recorded on the blockchain. The purpose of the channel is to record the operations of the council regarding all proposed strategies, approved or not.
Additionally, the Avalanche Pangolin Multisig has still not been altered to reflect the changes discussed and confirmed to be done as soon as possible. You confirmed you would make these changes on July 27th, 2022.
WIP 14.1 calls for CVX to be sold as soon as it is unlocked and capable of being traded effectively. The council has made repeated requests to execute the requirements of WIP 14.1 and more recently, other issues pertaining to the execution of WIP 14.1 have become apparent to the council. Namely that you refuse to act as a counterparty for our transaction. You have expressed that you consider yourself an interim treasury manager, yet are unwilling to take on this responsibility that is expected of someone in that position. Since the second set of CVX was unlocked and available for trade, the value of these assets has depreciated substantially, even though a course of action to execute the requirements of WIP 14.1 have been available and requested repeated throughout this time. What prevents you from acting as counterparty for our transactions? If you are unwilling or unable to act as a counterparty for our transactions, what course of action would you recommend we take to efficiently conduct transactions that require a counterparty?
7. Unprofessional Behavior
Your relationship with Sifu seems strained. As founder and stakeholder in Wonderland, and founder of one of our biggest investments, Sifu is playing a big part in Wonderland’s future. On multiple community calls you presented an interpretation of the SifuVision redemption mechanism that seemed to imply a potentially negative consequence for Wonderland’s investment in SV. Your statements seemed to imply you had not yet verified the information, yet you stated them as fact. After being informed of the misunderstanding, you continued to revisit your interpretation on multiple calls. Your statements are held in high regard. With your position of power and leadership, do you feel it is productive to present an erroneous interpretation of our investment without verifying the accuracy beforehand? Do you see a productive future with Sifu and our investment into Sifuvision?
You have exhibited hostile behavior toward our moderators and a general lack of decorum with team members. One particular example is when you told an elected member to “fuck off” in the General-Chat channel of Wonderland’s official Discord. This kind of behavior does not foster a productive environment for a team and it instills a negative image on our protocol. Our team members all work extremely hard to fulfill their duties and work together to keep the protocol moving forward even in the hardest of times. What can we do to better facilitate productive working relationships?
To be clear: this is not about how you feel about Sifu personally. The DAO is not concerned with how you feel about Sifu. We are pointing out that your behavior is overtly unprofessional and we are requesting that you clear up whatever issue you have and/or present a professional attitude in public channels. If you believe he’s done something wrong, then say that and let’s plug the hole.
Skyhopper is the same deal; it’s a big concern for a managing member to come to the DAO and say things that insinuate our previous treasury manager may have acted against our interests in some way. If you don’t believe he acted against the interests of the protocol, we do not see why it is productive for you to speak negatively of Skyhopper in a public channel. The DAO is not concerned with whether you are friends with Skyhopper personally - your behavior is in question. Either Skyhopper did something to negatively impact Wonderland and we should know about it or he did not and we respectfully request that you maintain a professional demeanor.
8. Liquidation Refunds
This issue has lingered for most of 2022. You have expressed that you will personally provide some kind of recompense to holders who were liquidated in Abracadabra wMemo cauldrons with a risk level lower than your own. While this repayment schedule does not necessarily concern Wonderland, being of a personal nature, the situation nevertheless continues to negatively impact the protocol and community sentiment. It would provide the protocol and community a much needed breath of fresh air if you could provide some form of official, unambiguous statement regarding this situation. An additional layer to this issue is the continued pressure for you to send the funds for Sifu’s share of liquidation refunds to Sifu, as privately agreed upon and openly confirmed.
All of this being of the personal nature, the concern arises due to the collection of situations that revolve around unpaid debt. These situations separately are each of moderate importance, but together they form a pattern of which we feel concern is warranted.
We are not asking you to provide a detailed payment plan for this situation. The liquidation refunds have plagued this protocol since the arrangement was articulated. This has negative impacts on the protocol on a Daily Basis. Your continued dismissal of the arrangement, without any official statement that we can direct users toward when they inquire, has placed the protocol and its team in a position to have to commit substantial effort to mitigating the fallout of your personal arrangement. The DAO is requesting that you make an unambiguous statement regarding this arrangement, including the status of returning Sifu’s portion of the funds, and explicitly express that all requests for information pertaining to this arrangement be directed to you personally, whether to your Twitter, your Telegram, or some other channel of communication outside of Wonderland’s official channels of communication.
We agree, this is a personal concern of yours. We request that you put in an effort to ensure it becomes strictly personal, relieving our team of this excess workload and allow our team to focus on Wonderland’s progress - not putting out fires surrounding your personal arrangements.
9. Bribes
It was articulated that the deal was arranged for 100% APR on our CVX assets; with CVX rewards and Bribes combined to equal that 100% APR - starting when Sifu and you first made the agreement. As changes to the terms of this agreement were not processed through the DAO or articulated to have changed in any way, the expectation is for the sum of the bribes to meet the original terms of the agreement. You mention the timeline is for the bribes to be paid by the end of September - What figure should Wonderland expect for the Abracadabra Bribes? Please provide an overview of the expected sum and how you come to this figure.
10. Abracadabra Conflict of Interest
On multiple occasions you have tried to pursue the proposition of merging Wonderland with Abracadabra. The above mentioned situations where our CVX votes were changed by a third party to support Abracadabra is worrying. I hope you can understand the concern many in the community may share; that you might continue to pursue that outcome in an overarching manner, or extended assistance to Abracadabra through various trading strategies that may not be the most profitable use of our assets, whether the community supports that effort or not.
You personally may have decided that there is no more cross interest, but it is not clear that the DAO has come to any terms on this. That is why this concern is included in the list. Please provide a detailed explanation of your intentions regarding Wonderland and Abracadabra relationship over the next year.
To clarify the response you first provided; you will not present any strategies or trades that may have an undisclosed benefit for Abracadabra attached to the activity in any way, correct? The expectation is that if you or anyone else proposes a strategy to the council, if Abracadabra will receive ANY form of benefits from the activity, whether directly or indirectly, you would disclose this information to the council prior to a vote for the strategy. Do you acknowledge and accept this expectation?
11. Abracadabra Personal Debt
You have a collection of negative positions open with Abracadabra, putting that protocol in a position to maintain this debt of more than $138,000. Abracadabra is technically unrelated to Wonderland and their debt could be considered out of scope for Wonderland Holder’s concerns. However, this particular activity highlights potential character attributes that reasonably seed concerns. What is your intention in regards to relieving Abracadabra of the debt associated with your positions? You mentioned that you “Can’t move funds till finish some KYC stuff” … “Is small and I should def pay it”. As a founder and manager of both protocols, this behavior instills a bad image for both Abracadabra and Wonderland. How can we be assured that you will not exhibit activity that could put Wonderland in a similarly controversial situation in the future?
12. Your personal stake in Wonderland and Team Allocation
Do you currently own any amount of TIME, MEMO, and/or wMEMO worth more than 1000 USDT? As a managing member of the organization with the highest level of authority, it is reasonable of the DAO to know whether or not you have any vested or unaccounted for controlling interest in the organization.
You have expressed that there will be no more team allocation in the future. However, You mentioned in July 2022 that “Team tokens are minted all the time with time” … “I did not claim my tokens since January”. In response to a Moderator mentioning Minting stopped in January, you said “Yea I know but” … “Still there is a dilution” … “I’ll take a look on how much that is” … “And see how to and if distributing it makes sense or not”.
Please clarify whether you believe TIME/MEMO/wMEMO assets have been diluted to provide you with team allocation tokens in the period of time since Minting was stopped in January 2022.
Expectations of this proposal:
If this proposal is passed through governance; it is expected of Daniele Sestagalli to supply the DAO detailed and unambiguous responses to all of these concerns, in addition to concerns that may arise as a result of this post, in written format within 14 days of approval. Following the delivery of a text based response, an AMA lasting approximately 2 hours should be held to review the responses provided and ask any questions about them within 5 days.
- I Support This Formal Inquiry
- I Do Not Support This Formal Inquiry