Rebooting the Audius Grants Program

Following the Audius governance takeover incident in 2022, the Audius community grants program effectively shuttered because there were no funds left to distribute. There was a note in the post mortem that this grants process would be reconstituted in the future; sentiment in the community at the time was that it would be best to wait for 1) re-audits of the system (which have since been completed) and 2) passage of some significant period of time without incident. Both of these conditions have come to pass - and we propose to reconstitute a public grants program under the administration of the Open Audio Foundation as a means of securing the process of funds disbursement.

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The proposal herein requests to do the following:

1. adjust the top-line inflation rate for $AUDIO to 8%, in line with expected compounding since the last adjustment. The last inflation adjustment set the rate to 7% at the time the $AUDIO rewards program was launched in early 2022.
2. decrease the allocation of ongoing inflation to the $AUDIO rewards program to 20,520.55 tokens per week (~1.067mm per annum). A large surplus reserve of 15mm tokens has accumulated in the rewards system. We suggest increasing this rate in 1-2 years or if the reserve dips below 3mm tokens. Reserve balance and real-time reward disbursements can be viewed on Solscan.
3. create an additional target payee alongside the existing staking reward and rewards program payees for a grants program Ethereum address provided by Open Audio Foundation, and direct the proceeds of this inflation change there.
4. create a public RFP and grants issuance program administered by Open Audio Foundation, funded by #3 above.

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Staking rewards and the available $AUDIO rewards programs for end users to participate in remain unchanged by these adjustments. Upon ratification, the Open Audio Foundation will begin publicly soliciting grant applications, and will disburse funds when 1) directed by the on-chain community by governance vote and/or 2) when its own internal grants committee deems appropriate, in each case subject to its diligence and compliance obligations. By adding this additional step compared to the old process, Open Audio Foundation can utilize traditional qualified custodians with process controls in place to secure assets not yet disbursed, avoiding the smart contract risk that led to the previous exploit.

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The implementation of this change requires two on-chain governance proposals:

1. a proposal to increase the number of tokens minted in the inflation process directed towards community payout.
2. change the target of the community inflation payout to a new splitting smart contract which will be deployed on Ethereum mainnet that implements the new split between the rewards system and the Open Audio Foundation community grants address. EDIT (12/20/24): this has now been deployed and verified at address 0x69eaAcaD9c08BF3A809688395A5f2f0cCAC5aa0D

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These changes will be proposed on-chain shortly pending any feedback posted on the governance forum.