February 1, 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 January 25, 2023 Spartan Council Weekly Project Sync:
Spartan Council: Cavalier, dsacks, Jackson, KALEB, TerraBellus, William87
Core Contributors: Afif, Ana, joey, jz, noah, Rafa, Regina
First, a quick work in progress update:
- SIP-255, to burn fees instead of distribute them, is currently in its final internal review stage and is being queued for audit
- Debt migration will be next up after SIP-255, and
- The audit for Perps V2 is complete and is scheduled for Mainnet release this week
As for V3, the CCs are currently processing feedback on the V3 core code and are anticipating a full report from the auditors in the next week or two. Work is also continuing, simultaneously, on the spot market implementation so that it can be sent for audit as soon as the core code audit is complete. Noah said they are loosely planning to have the core system soft launched on Mainnet around mid-February. All we want for Valentine’s Day is V3 ❤️. The team is also currently working on tooling, as well as the deployment pipelines, and have been discussing V3 compatibility with existing governance systems.
Last week, TerraBellus also brought up a community concern that cross-asset swaps are not delivering consistent volume. Kaleb explained that 1inch is still reviewing the implementation, and the Council is working on other integrations (like Cowswap). On the Synthetix side, the focus can really only be on delivering the best possible product that other protocols want to integrate, but also one where they ultimately control the process and timeline of integration.
Terra also brought up having a neutral moderator on public Spartan Council and CC calls, and it was suggested that SNXweave fill this role, so you’ll be hearing from Connor Kai a little more often!
There were also a few SIP presentations last week, so let’s briefly review them:
SIP-295: Adding BTC, SOL, AVAX, MATIC, LTC, DOGE, APE, BNB, ADA, NEAR to Synthetix Perps V2
- Matt presented this pretty straightforward proposal, which creates several new Perps V2 markets (BTC, LINK, SOL, AVAX, AAVE, UNI, MATIC, XAU, XAG, EURO/USD, APE, DYDX, BNB, OP, and DOGE)
- This SIP is intended to facilitate the transition from Perps V1 to V2 without having to approve individual markets in the improved perps product
- All of the assets picked already have Chainlink feeds so there is no additional work that would prevent them from being offered in Perps V2 immediately
- Open interest would be capped at $1.5m for BTC and $500k for all of the other assets
- Kaleb and Terra suggested adding language saying the assets would initially be paused, pending SCCP approval on specific parameters for each one
- Kaleb also brought up that each asset with a specific availability window (XAU, for example, which only trades during certain hours) should maintain those properties in Perps V2
SIP-297: Perps V2 Fixes
- This next SIP, presented by Kaleb, will improve the liquidation fee calculation, clean delayed order events and object parameters, fix the funding rate accrual computation, and introduce a cap on the fees sent to liquidators for very large liquidations
- It will do all these things with these specific fixes:
1. Eliminate unused parameters (which is mostly just “cosmetic” to clean up the code)
2. Include position size in the Liquidation Premium calculation
3. Replace the 0.5 liquidation factor for an SCCP-configurable parameter
4. Use fill price (rather than oracle price) to calculate Order Fee
5. Include price of asset in the funding accrual calculation
- Lastly, there was a brief high-level presentation of SIPs 302–305, which make up a lot of the core code for V3
- The big change in V3 is the differentiation of the debt pool into modular elements called markets (SIP-303). At launch, V3 will start with one pool with a legacy market that includes all of the current offerings in V2X
- V3 also introduces “pools” (SIP-302). The idea here is to allow functionality to open up governance-allowed products and collateral types beyond the current limitations. This represents a step towards permissionless use of Synthetix-designed infrastructure!
- Staking positions will be managed and represented by an NFT (already approved in SIP-301)
- The liquidation system from V2 will be carried over to V3 (SIP-304), where liquidations in different vaults would be socialized as they are in V2X. And if the vault runs out of positions to socialize to, the entire vault can be liquidated
- Lastly, a rewards manager will allow pool owners to distribute rewards without SC input (SIP-305)
- There were also some questions after this high-level presentation, all from Kaleb, asking:
Will stakers be able to allocate credit to different pools?
- This is the long-term goal, but there will just be the SC pool initially. However, it may make sense as an intermediate step to have multiple SC-approved pools as products begin to launch natively on V3.
How will funds be allocated to different markets/pools?
- This is a function of governance and any allocation to SC pools will be voted on by the SC.
Will the rewards manager resemble the current liquidation reward procedure?
- No, because it doesn’t rely on a snapshot of staking positions to distribute rewards. Rewards are perfectly pro-rata at the time of distribution.
Present at the January 26, 2023 Grants Council meeting:
Grants Team: Ana, CT, JVK, synthquest
In Grants Council updates, JVK’s secret project is complete…and this is everyone right now:
Synthquest has been in communications with GUNBOATs about building out a more comprehensive stats Dashboard in Dune, and the Council has been discussing stats strategy, CC vs. GC responsibilities, and 3rd party stats websites like Cryptofees.
The Council is also still working on the NFT whitelist, as well as getting their snapshot voting working again since it’s been a bit buggy.
Present at the January 25, 2023 Ambassador Council meeting:
Ambassadors: GUNNBOATs, Kevin, mastermojo, Matt
In Ambassador news, the team is still on a Spartan Space roll, hosting Illuvium last week and Threshold tomorrow!
The Council discussed governance updates, including: Matt and Doug both being elected to Optimism’s new Grants Council, how numerous Synthetix ecosystem projects were elected for self-delegation (Lyra, Kwenta, Thales, Polynomial, and dHEDGE), and how many were grateful for the guidance that the Ambassadors offered through this whole application process.
The team also attended governance calls for HOP, Interest Protocol, and Euler, and Matt attended a call with Penn Blockchain. They also kept up their voting activity last week, with numerous Gearbox, Euler, and HOP votes.
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SIP/SCCP status tracker:
SIP-255: Burn fees instead of distributing them, Status: approved
SIP-237: Debt Migration, Status: draft
SIP-295: Adding BTC, SOL, AVAX, MATIC, LTC, DOGE, APE, BNB, ADA, NEAR to Synthetix Perps V2, Status: vote pending
SIP-297: Perps V2 Fixes, Status: implemented
SIP-302: Pools (V3), Status: draft
SIP-303: Markets (V3), Status: draft
SIP-304: Liquidations (V3), Status: draft
SIP-305: Rewards (V3), Status: draft