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SNXweave Weekly Recap 116

SNXweave

Nov 22, 2023 • 5 min read

November 22, 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.

👉TLDR

V3 core and Perps V3 are both on Base Goerli testnet!
Cross-chain election module audit feedback is being implemented — could be ready for upcoming election in December
SC V3 tokenomics discussion: Kain thinks the council should get feedback on the experiments that have been proposed, Gene and Millie voiced concerns about the USDC collateral experiment, Adam emphasized that relevant information needs to be clearly communicated to the community. There are several upcoming SIPs related to tokenomics, and Matt will be writing a blog post on them collectively.
SC inflation discussion: read below
SIP-349: Add crosschain reads with Wormhole CrossChain Queries presentation recap
Grants Council update: GC is looking into new tools for tools.synthetix.io, two retroactive grants were proposed, current pending grant requests were discussed, team is brainstorming watcher page staking fee calculator, and the site’s account and PnL pages are almost ready.
Ambassador Council update: Ambassadors discussed their Spartan Space with Valio and Kwenta, and went over their OP votes for the 8 recent votes that ended a few days ago. OP’s Retroactive Public Goods Funding Round 3 is currently open, so the Ambassadors discussed projects that have been submitted. GUNBOATs and Kevin represented the Synthetix Ambassadors at Blockchain Genesis for Thailand Blockchain Week 2023.

Spartan Council and SIP updates

Present at the November 15, 2023 Spartan Council Weekly Project Sync:
Spartan Council: Adam, Burt, cyberduck, Genefaesius.eth (Gene), Jackson, Kain, Millie, ml_sudo
Core Contributors: Afif, Cavalier, Jade, joey, jz, KALEB, Matt, Max, meb, Mike, Nikita, Steve, sunny, troy

V3 core and Perps V3 are both on Base Goerli testnet! And the cross-chain election module audit feedback is being implemented, which means it could be ready in time for the coming election in December.

Last week the Spartan Council also had a discussion about V3 tokenomics, as Millie wanted to make good on the Council’s promise to bring some resolution to this issue by the end of the epoch. Kain suggested a better discussion would be to get feedback on the experiments that have been proposed and if the council feels that those experiments will deliver all of the information necessary to make a decision on tokenomics going forward.

Gene voiced some concern about the USDC collateral experiment, but acknowledges that it seems to be a popular idea among users and the rest of the Council. The primary concern, which Millie also expressed, was how external collateral affects SNX token holders. Kain stressed that the point of these experiments is to find out if there is any demand at all for liquidity providers (LPs) with other collateral willing to be the counterparty for perps trading.

Both outcomes (whether demand is high for USDC/ETH collateral or not) provide valuable data on how the protocol should proceed with its scaling roadmap. Adam also called out the importance of communicating that information very clearly to the community because many have jumped to conclusions about what Andromeda means for SNX collateral in the future. There are several upcoming SIPs related to tokenomics, and Matt will be writing a blog post on them collectively.

Next, Millie wanted to get a temperature check from the SC on where everyone stands on ending inflation. Duck thinks if the buyback and burn can make the token deflationary without completely shutting off inflation, that leaves room to continue incentivizing desirable behavior. Kain thinks it’s generally a moot point, but there might be perceived value if inflation is completely turned off since the current optics of the SNX token is that it’s highly inflationary.

Adam suggested directing some inflation towards V3 spot markets before cutting it off completely, which will bootstrap liquidity there while simultaneously demonstrating that it’s not necessary for V2. Burt advocated for a more data-centric approach, calling out that it’s unknown if there are any tangible consequences to cutting off inflation completely. Kaleb brought up that inflation has decreased substantially over the past year and the staking percentage has held at around 70%.

Next up, there was a SIP presentation last week for SIP-349 to enable cross-chain reads on Synthetix V3 by integrating Wormhole’s CrossChain Query (CCQ).

SIP-349: Add crosschain reads with Wormhole CrossChain Queries

If approved, Wormhole CCQ will be implemented, enabling proposals like SIP-312 (V3 cross-chain pool synthesis) to unlock a multichain future for Synthetix V3
If there is a need to sync pool data across chains, this SIP will provide the infrastructure to make that possible
Any use case for this tool would be outlined in different SIPs, such as SIP-312 or future SIPs proposing to link isolated deployments from different chains

Some SC members brought up challenges that bridges have had in the past and asked for some more clarity on the updated security model. The Wormhole team responded saying:

The Gaurdian set for Wormhole is comprised of top 19 validator companies, and their primary function is data attestation
2/3rds of the Gaurdians must witness a transaction to achieve consensus
For cross-chain queries, the inverse happens (Guardians perform a call and discuss the results, which is then verified via a two thirds majority)
All of the validators are completely doxxed and have a reputational stake in verifying accurate information
Following previous exploits, an additional circuit breaker has been put in place to limit notional transaction volume that can be verified in a 24 hour period
A ‘global accountant’ mechanism has also been added to check all debits against credits to verify that what is being distributed on another chain has been collected first
There have also been 20 audits and all the security code is open source
Kain called attention to the fact that there are already outside dependencies that Synthetix relies on (Oracles) and thinks this is a useful piece of infrastructure that will be crucial in the future
Cav highlighted that the intention with this SIP was to separate the infratructure from the specific feature that it will be used to implement

Grants Council

Present at the November 16, 2023 Grants Council meeting:
Grants Team: ALEXANDER, CT, MoneyManDoug, synthquest

In Grants Council updates, the team had a few action items come out of last week’s meeting:

Doug will be looking into adding new tools for tools.synthetix.io
Two retroactive grants were proposed: one for the CCs for helping with Ambassadors voting and one for Gelato auto mint
The team also discussed current pending grant requests and are waiting on technical input for one grant request
They are also brainstorming watcher page staking fee calculator, and the site’s account and PnL pages are almost ready

Ambassador Council

Present at the November 14, 2023 Ambassador Council meeting:
Ambassadors: GUNBOATs, Kevin, Mastermojo, Matt, Westie

Lastly, in Ambassador updates, the team discussed their Spartan Space with Valio and Kwenta, where they had over 60 people in attendance. They also went over their OP votes for the 8 recent ones that ended a few days ago — you can see how they voted on Optmism’s proposal page.

Optimism’s Retroactive Public Goods Funding Round 3 is currently open, so the Ambassadors discussed projects that have been submitted and how to vote for them. There are currently 643 projects after making the cuts. Lastly, GUNBOATs and Kevin attended Blockchain Genesis for Thailand Blockchain Week 2023, where they represented the Synthetix Ambassadors!

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SIP/SCCP status tracker:

SIP-349: Add crosschain reads with Wormhole CrossChain Queries, Status: draft

SIP-312: Cross-chain Pool Synthesis (V3), Status: draft