November 30, 2021
The following post contains a recap of news, projects, and important updates from the Spartan Council and Core Contributors, as well as the grantsDAO and ambassadorDAO from last week.
Spartan Council and SIP updates
Present at the November 23, 2021 Spartan Council Weekly Project Sync:
Spartan Council: Afif, BigPenny, bojan, Danijel, jj, Kain, KALEB, Michael
Core Contributors: Darius, Rafa
L2 Bridged Governance went out last week on the Menkalinan release! As a reminder, this SIP creates a bridge to connect L2 contracts to an L1 Gnosis Safe. The bridge will allow the protocolDAO to execute actions on L2 contracts using the same mechanism used on L1. With the recent OVM 2.0 upgrade, the Optimistic Ethereum L2 now offers full EVM equivalence enabling more seamless synchronization of features. To maintain consistency between L1 and L2, this release also implemented liquidations on L2.
In case you missed it, Kain released a Debt Synthesis blog post a few days ago talking about what’s been done so far on V2x, and what’s to come. This post details five major components of the Debt Synthesis process: debt shares, two oracles, debt pool synthesis, restoring fungibility with teleporters, and debt migration.
- Debt shares is a new tokenized debt tracking system that will replace the debt register, which is not compatible with a multi-chain debt pool.
- Next, Chainlink is developing two novel oracles for the Debt Synthesis: a debt pool oracle and a debt shares oracle. The first oracle will read the size of the debt pool on each network and combine these values so that both networks are in sync with respect to the combined debt pool size. The second oracle will read the total supply of the debt shares contract and push the combined total supply of debt shares on both networks onto each chain.
- Once the oracles and debt shares are in place, the Debt Pool Synthesis can be initiated. During this Synthesis, the system will be paused and the debt percentage calculations will be updated for both claims to reflect the total debt and the total supply of debt shares. This means stakers on each network will be responsible for the debt on both networks regardless of which network they’re staking on.
- Once this is completed, there will be a Synth Teleporter SIP to restore fungibility of synths across the two networks. This will work by burning a synth on one network and re-minting it on the other, thereby allowing any synth to be moved between networks as needed.
- Lastly, the Debt Migration SIP will serve as the final step of the Synthesis and will allow any staker to migrate their debt position from L1 to L2 without needing to burn their debt. This will allow you to transfer your entire SNX balance, both escrowed and unlocked to L2, while maintaining your c-ratio.
It is likely that Debt Shares will be completed before the end of the year, but the rest of the Debt Synthesis SIPs will likely go out early next year. Everyone is also hard at work trying to get Futures out as soon as possible, and Afif just shared a blog post giving us a full Futures update. The post details the progress of Futures ever since the recent OVM regenesis and incentivized testnet competition, as well as the lessons learned from the testnet and the remaining scope to be completed before Futures can be deployed to Mainnet. While the initial hope was for Futures to be out before the end of the year, it’s looking like the new target launch date is mid-January.
But before Futures can go out, the Council has made it clear that next price fulfillment and Dynamic Exchange Fees are needed for its deployment. Lecky is done with the Dynamic Exchange Fees SIP, and is hoping to start testing it within a week or two once it comes back from audit. SIP-184 allows for lower spot fees for those who want to do atomic exchanges, and next price allows for a second fee-tier for arbitragers to trade at a low fee, which helps make the funding rates less steep for everyone else. Both of these will drastically improve the futures trading UX.
As for Futures itself, most of the engineering work and code is already done. Afif met with Arthur to talk through some of the next price logic and to make sure it doesn’t provide any free optionality to people who are trying to do next price exchanges. They discussed factors like whether or not you can cancel an order, how long a next price order can be confirmed for, and how it factors into the funding rate.
The Council also briefly discussed governance at their meeting. You may have seen last week that SIP-172 for V2x Governance Processes & Changes was voted on and approved with all eight Council members voting in favor. And, the Core Contributor Committee, which was also approved with eight votes in favor, has been put in motion. The process of nominations has been started internally, and Kain is confident that we’ll have this Committee by the end of the year. He added that once the Core Contributor Committee is done, the Council might also try to push out the Risk Committee by the end of the year so that they can start reviewing the upcoming Debt Synthesis SIPs.
There will also be two SIP presentations today in the Stage-Community-Governance channel in Discord: SIP-180 for Aelin Protocol and SIP-188 to add a sETHBTC synth. Be sure to tune in or catch the recording!
Present at the November 24, 2021 grantsDAO meeting:
grantsDAO Team: ALEXANDER, CT, Mike, rubber^duck
In grantsDAO news, the gDAO hosted a Twitter Space in partnership with the aDAO to discuss their upcoming Retroactive Public Goods Grants initiative. We got to hear from CT and rubber^duck, who discussed the initiative, gave some background, and explained more in detail what the plan is. The gDAO mandate is to provide funding to create products or services that benefit the Synthetix community, using a budget from the Treasury Council. A couple of months ago the gDAO started looking at Vitalik Buterin’s RPGG model and then started issuing small “community tips” to users who did something beneficial to the community without expecting any payment. Examples of where these tips have been rewarded is to those who produced insightful and helpful blog posts, lively contributions and encouragement in the 300 discord channel, and active participation on Twitter in response to various Synthetix-related events.
Then, the gDAO commissioned SNXweave to write an in-depth article detailing the history of RPGG, how it works, and how they will be implementing it into their mandate. If you haven’t checked out this article, you should definitely give it a read on the Synthetix Grants Medium!
CT noted that DeFi Llama was one of the first projects to draw their attention for a retroactive grant. DeFi Llama provides an overview of the DeFi ecosystem, along with metrics and usage statistics for every DeFi application. Aggregating and displaying real-time data in an easy-to-consume form is not a new idea, but doing so without following the well-defined path to profitability is what set DeFi Llama apart. CT explained that this resonated with him, and that the value their product provides to the community is an excellent example of a project worthy of a retroactive public goods grant.
The gDAO explained that $50,000 of their RPGG budget will be put towards their private funding round with Gitcoin, who they chose because of their decentralized and quadratic funding model. For this side round, they have a curated list of about a dozen projects that they have been putting together over the course of several weeks, with the help of the other DAOs and the community. This list includes dApps, infrastructure projects, wallet alternatives, and more. This funding round starts tomorrow, December 1st! The remaining $25,000 of the RPGG budget will go into the public funding round.
The gDAO released an Eligibility Criteria post on their blog that details all of the requirements necessary in order to be qualified for this retroactive grant round. The Grant must: be free or very cheap to use, directly advance the larger DeFi community, directly or indirectly support the Synthetix community, be open source, must not have any form of quid pro quo that has financial value, must not have its own token or have raised VC funding, and the owner must be directly affiliated with the project where the funds may go directly to the project. The Grant should also be focused on accomplishing usability, providing information, growing the community, improving the developer experience, building tools to enhance governance, and/or campaigning for governance delegates and champions.
Lastly during the Twitter Space, the gDAO said that by trailblazing this DeFi RPGG initiative, they hope this project will encourage other protocols to join in and incentivize builders to build useful products with the potential for future payout. To quote CT, “a protocol and community need to choose what kind of culture they live and operate by, and this will be a small step towards the Synthetix community adopting this culture and setting an example for other protocols to do the same.”
Over the past week, the gDAO has been finalizing their list of projects for the launch of the RPGG initiative tomorrow. In doing so, they are ensuring that all of their projects have profiles set up appropriately on Gitcoin so that they can receive retroactive funding. Mike also said that Gitcoin wants to do a Tweet thread promoting the side round, so he will be arranging this with them. Gitcoin is also going to be hosting a live Twitter Space next week on December 8th, so stay tuned for those details.
The grantsDAO has expressed interest in digging up some Dune analytics data on Synthetix stakers, so Mike has been working on this with Core Contributor db. It was found that of all the stakers on L1, more than 60% of them are small stakers with less than 100 SNX. And of all the stakers on L2, none of them are these small stakers. db said this data needs to be analyzed more in-depth, so the gDAO will potentially be putting out a request for proposal in search of someone who can perform some Dune analytics on this Synthetix staker data. CT said that if these stats are correct, they really need to dig deeper into the activity-based information on people staking small amounts of SNX.
Lastly in grantsDAO news, Universe has been whitelisted for Optimism! As a reminder, the gDAO is partnering with Universe on their upcoming NFT project, so this is very exciting. They are optimistic for deploying their products on Optimism very soon, possibly late December or early January.
Present at the November 23, 2021 ambassadorDAO meeting:
Ambassadors: andy, MiLLiE
The gDAO’s NFT project is a good segue to the Ambassador’s updates, because the aDAO is hoping to host a Spartan City Hall with Mark from Universe and the guys from Opti Punks — an NFT-themed City Hall, if you will. The aDAO is thrilled with how much enthusiasm they’ve been receiving regarding the City Halls, and they have several lined up to fill the slots for the upcoming weeks. This week we will likely be hearing from Across protocol and dHEdge. The Ambassadors also hope to do a follow-up City Hall with Aelin once they are fully deployed to talk about tokenomics and everything going forward after they are finalized.
Lastly, the aDAO discussed the fact that many users have not yet claimed their rewards from the Governance Participation Program, which is likely due to gas being too high on L1. They are discussing possible ways to help with this — more to come here.
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SIP/SCCP status tracker:
SIP-167: L2 Bridged Governance, Status: implemented
SIP-184: Dynamic Exchange Fees, Status: approved
SIP-80: Synthetic Futures, Status: feasibility
SIP-180: Aelin Protocol, Status: SC review pending
SIP-188: Add sETHBTC synth, Status: feasibility