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SNXweave Weekly Recap 101

SNXweave Weekly Recap 101

August 9, 2023

The following post contains a recap of news, projects, and important updates from the Spartan Council and Core Contributors, as well as the Grants Council and Ambassador Council from last week.

Spartan Council and SIP updates

Present at the August 2, 2023 Spartan Council Weekly Project Sync:
Spartan Council: Adam, Burt Rock, cyberduck, Danijel, dsacks, Jackson
Core Contributors: Afif, db, KALEB, Mike, noah

The core system for V3 is feature-complete! Small upgrades will be rolled out over time as necessary, but the focus is expected to shift more towards markets and governance as core development slows down a bit. Noah even said the CCs drafted an Ethereum Improvement Proposal (EIP) to create an Ethereum-wide standard for cross-chain reads.

Next up, Perps V3 is currently on Goerli (testnet) and Kwenta and Polynomial have started their integrations. Two devs are also preparing to start work on the Thales OT integration, and a better system for incentivizing keepers in V3 is currently in development. The Mainnet timeline is still unclear, but the next step is to get integrators ready for the testnet competition.

And speaking of perps, the CRV has generated a lot of activity for Perps V2. It appears to be generating volume 10 to 20 times the OI caps — this popularity is likely partially due to it being difficult to find other on-chain options for trading CRV with leverage. WLD was also added to perps, with the recent approval of SCCP-2032.

In governance updates, the safe module is through audit and the election frontend rewrite is in progress. While the rewrite is going smoothly, it will not be ready for the upcoming election, so the plan is to have a full election system refresh ready for the December election.

The Spartan Council and CCs also brought up the deployment to Base, Coinbase’s OP stack L2 that is launching today. Synthetix would be among the first protocols to launch on Base — the plan is to launch with contracts paused to give integrators a chance to start looking at the code. Once Perps V3 is ready, the full product will be available on Base.

Danijel asked how perps would function without liquidity on Base, and Kaleb added that it would be difficult to get enough SNX over there to sufficiently bootstrap liquidity. It is still possible that other collateral types could be enabled, but this would have to go through governance and community support is mixed. Jackson also highlighted that it might be wise to start considering solutions to avoid severe liquidity fragmentation across L2 deployments. This is already being explored using CCIP, but this functionality probably won’t be ready until sometime in 2024. Noah will be putting together more information on this subject to share soon.

Next up, there were several SIP presentations last week, so let’s briefly review each of them:

SIP-325: Add Multicall Proxy Function

  • Presented by Noah, this SIP proposes adding a new multicall function that can be used with core system functions, such that the value of msg.sender can be preserved
  • The core philosophy of V3 is that each function should only be doing one thing (as often as possible)
  • Complex user actions are then accomplished via multicall, which allows for a wider range of protocol functionality
  • There is already a multicall function within the core system, but it doesn’t have the ability to call contracts outside of the core system (Perps V3 for example) — this SIP will address that

SIP-332: Mint and Burn with Account Balance

  • Rather than minting/burning stablecoins from the wallet of the address which calls the function, this SIP will make it so that the stablecoin balance changes occur on the core system address and are associated with the relevant account
  • Db explained that the additional requirement of allowing cross-chain pools is the ability to hold withdrawals of snxUSD in the user’s account for a small period of time — this is to allow for other chains to read that this action has taken place (which created a possible exploit opportunity)
  • This change is therefore being done as a general modification rather than one specific to cross-chain pools to keep the overall complexity of V3 as simple as possible

SIP-333: Pool Collateral Caps

  • This SIP proposes an enhancement to Synthetix V3 that allows pool owners to specify caps for the amount of each type of token that they will accept as collateral
  • While considering the implementation for SIP-326 (additional pool configuration), db said it became apparent that pool owners may want more fine-grained control regarding collateral delegation
  • This SIP is a minor technical change required in order to implement 326

SIP-334: Add Optional Bytes Field for Oracle Manager Requests

  • This SIP proposes enhancing the Oracle Manager in the Synthetix protocol to support custom bytes data in requests, which will enable Oracle Manager nodes to alter outcomes based on the provided information
  • This will be an excellent tool for the Synthetix ecosystem as it will allow market creators to more easily access oracle resources without an extensive technical background
  • This proposal was motivated by the need to quantify account margin-based price impact resulting from position size (i.e. exchange rate for 1 ETH would be different from the exchange rate on 100 ETH)

SIP-335: Allow revoking ERC20 approvals

  • A minor bug was discovered that prompted the proposal of SIP-335 for a minor change to Synthetix V3’s implementation of ERC20 that allows 0 value approvals, which is needed for token revokes
  • By not reverting and allowing 0 value approvals, it means the ERC20 implementation allows for downstream services and users to fall in line with the recommendation defined in EIP-20 to prevent certain attack vectors

All of these SIPs are pending Spartan Council review.

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SIP/SCCP status tracker:

SIP-2028: Add WLD to Perps V2, Status: implemented

SCCP-2032: Perp Parameters — WLD, Status: implemented

SIP-325: Add Multicall Proxy Function, Status: SC review pending

SIP-332: Mint and Burn with Account Balance, Status: SC review pending

SIP-333: Pool Collateral Caps, Status: SC review pending

SIP-334: Add Optional Bytes Field for Oracle Manager Requests, Status: SC review pending

SIP-335: Allow revoking ERC20 approvals, Status: SC review pending