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What Cardano Improvement Proposals (CIPs) are for

Published 12.4.2023

Would you like to improve the Cardano protocol? There is a process for doing this called Cardano Improvement Proposals (CIPs). Through the CIP process, you can create a document in which you can describe the problem and propose a solution. CIPs should serve as the primary mechanism for proposing changes to the Cardano protocol. It is where authors, CIP editors, and the community meet. They can all debate the proposal. Proposals are usually submitted by experts and expertise is also expected from reviewers. If anyone is interested in detailed technological information, CIP documents can be a useful resource. People are sometimes confused and don't know how the CIP process and on-chain governance are related. The introduction of on-chain governance is proposed in CIP-1694. Let's take a look at it.

TLDR

There is no direct connection between the current CIP process and the on-chain governance proposal as described in CIP-1694. However, CIP documents could serve as input for governance in the future. CIP documents would contain technical details about the problem and the ideal expert-approved solution.

CIPs and governance

First and foremost, it is needed to explain that the CIP process has nothing to do with on-chain governance. CIPs should be used to describe the problem in detail and propose a technical solution. The proposed change can be debated and design decisions can be documented. It is not the role of the CIPs process to decide whether to implement changes. An existing CIP document (proposal) is no guarantee that a change will be implemented in a protocol or otherwise deployed.

CIPs have two essential tasks. To standardize the form of communication between participants and to enable changes to be proposed in a uniform formalized way. Each CIP document has an author and the author must follow the required document structure. CIP documents can have the following self-explanatory statuses: Proposed, Active, and Inactive. CIP Editors ensure that CIP documents have the required structure and technical soundness. The process for transitioning CIP documents between statuses is described.

CIP Editors safeguard the CIP process. However, their role is not to approve or reject the authors' proposals. They may not agree with the proposal, but if it is technologically sound and complete and the author follows the required document structure, the proposal will be produced.

Editors may provide technical feedback on proposals but are not expected to be the only ones to provide it. CIPs is a community-driven process and anyone with the necessary technical knowledge can be a reviewer and provide feedback.

The editors are mainly there to facilitate discussions and mediate debates. They are not necessarily technical experts on all the topics covered by new CIP documents. Ideally, there will be a sufficient number of reviewers with the necessary technical knowledge to provide quality feedback. Authors of CIP documents should incorporate feedback from reviewers to produce a document of the highest quality with sufficient technical detail (including both positive and possible negative impacts of the proposed change).

How does the CIP process relate to on-chain governance? The CIP process is a community-driven component that can serve as input for on-chain governance. It is theoretically possible to vote on individual CIP documents.

The goal of the CIP process is to have the protocol problems described along with their possible technological solutions. The proposals may also concern processes. On-chain governance should focus on the decision-making process and individual CIP documents can be subject to decision-making.

Note that CIP-1694 is the basis for the creation of decentralized governance. This document does not address the context of the CIP process in any way. CIP-1694 is the creation of the governance structure and a new role of Delegation Representatives (DReps). Further, it is about who will have the right to change protocol parameters, have control over project reserve and treasury, etc.

At this point, at least as far as I know, there is no direct link between the CIP process and the on-chain governance that is proposed in CIP-1694.

Conclusion

You may wonder if governance is important and if a CIP process would be enough. As we have tried to explain, the CIP process is not about making decisions about whether to implement changes. A team is needed to implement the changes and that team needs to be paid ideally from the project treasury. The authors, CIP editors, and reviewers should not have the right to decide what changes to implement, as they may not represent the opinion of the majority of ADA holders. For the same reason, nor should the team be in a position to pick and choose the changes it implements. The decision should be made by ADA holders, through DReps. It is therefore to be expected that there will be a direct link between the CIP process and on-chain governance.

To learn more about the CIP process, find CIP-1.

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