Compound community proposal: Proposal to transfer EPCF and SVR revenue to a 9-party community multisig custody

BlockBeats news, October 8th, according to the Compound community forum, community member ugurmersin proposed an alternative to Proposal 613, suggesting to transfer the custody of the Ecosystem Protection and Continuity Fund (EPCF) and the mainnet Chainlink SVR revenue assets from the Safe currently solely controlled by the Compound Foundation to the Community Multisig, adopting a 5/9 multisig mechanism.

This proposal does not advocate for closing the EPCF, but rather adjusts the fund custody method. According to the proposal, as of October 8th, the EPCF holds $500,000 USDC and $4.5834 million USDC deposited in cUSDCv3; the mainnet Chainlink SVR revenue holds 355.95 ETH. Currently, the two funds are managed by the Foundation-controlled 2/3 Safe and 2/4 Safe respectively. After the proposal is passed, both funds will be custodied by the Community Multisig with a 5/9 multisig mechanism.

The proposal initiator stated that Proposal 613 was previously canceled by the Proposal Guardian on October 7th. The original Proposal 613 planned to close the EPCF and transfer the funds to the Governor Timelock, but some community representatives believed this would weaken the EPCF's rapid response capability. Therefore, this alternative retains the EPCF's original purpose, scale, and 48-month term, while continuing to preserve the ability for emergency fund deployment.

ugurmersin believes that currently, the EPCF and SVR revenue suffer from the issue of single-institution control by the Foundation. In contrast, the Compound Treasury Escrow is controlled by the Governor Timelock, TMC withdrawals require approval from 4 out of 6 signatories, and withdrawals are also subject to cooling-off periods and mechanisms such as the Community Multisig.
The proposal also questions the Foundation's previous use of V2 reserve funds. The proposal states that approximately $7.988 million USDC was transferred out of the V2 Reserves and ultimately entered a Binance deposit address; in addition, 100,000 COMP and subsequently an additional 50,000 COMP also flowed through related wallets to multiple trading platforms. As of October 8th, this wallet has cumulatively transferred 213,800 COMP to trading platforms and recovered 93,049 COMP, currently still holding 29,250 COMP.

Regarding the aforementioned fund flows, the proposal initiator stated that the Foundation had previously claimed it "did not conduct transactions," but since internal transactions on trading platforms are not directly visible on-chain, it is impossible to determine solely from on-chain data how much of these COMP tokens were actually sold. They argued that the Foundation has not yet disclosed its agreements with the relevant trading institutions or the records of COMP purchases, transfers, and disposals, and noted that they had previously characterized the related actions as "misappropriation," which the Foundation opposes.

The proposal ultimately recommends that a Community Multisig composed of 9 organizations be responsible for the custody of the relevant funds, with transactions requiring signatures from at least 5 parties to execute. The initiator also acknowledged having previously criticized the membership composition of the Community Multisig, but believes that joint signatures from 5 of the 9 organizations can provide a stronger system of checks and balances compared to a 2/3 multisig controlled by a single organization.