SNXweave Weekly Recap 92

June 7, 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 May 31, 2023 Spartan Council Weekly Project Sync:
Spartan Council: Adam, Burt Rock, Cavalier, cyberduck, dsacks, Jackson
Core Contributors: Afif, db, KALEB, meb, Mike, noah, sunny, troy

The Optimism Bedrock release is here!! As a reminder, Bedrock is the name of the first-ever official release of the OP Stack, which is a set of free and open-source modular components that work together to power Optimism. This release will bring reduced fees, shortened deposit times, improved proof modularity, enhanced node performance, and improved Ethereum equivalence.

There was a brief period of downtime, but all systems are back up and running again and Optimism assured that this would be the last upgrade that required downtime. It was unavoidable in this instance because of the plans to migrate to an architecture that is more aligned with ETH.

Next, the V3 spot market has now been on Mainnet for two weeks! The CCs have been doing QA in the meantime, and are working on bootstrapping it with more liquidity, but are still seeking feedback from the Spartan Council.

The loose target for the Perps V3 audit is July, as a lot of the work has been done in parallel with the spot market work, and this will allow for a testnet competition! Progress has also been made on teleporters and the CCs have been in touch with Chainlink on CCIP and working out details for cross pool synthesis.

During last week’s meeting, Cav asked about what’s next for the spot market, and Noah said possibly a curve pool setup with liquidity for the new stablecoin. He added that it would also be a good time to start a conversation with 1-inch in an effort to bring cross asset swap volume back. The main thing right now is to begin testing the system with real money to ensure that everything is working properly.

The next priority is then to get people using it and building out stats pages, tooling, and other resources so that all of that is ready for the Perps V3 launch. So now is actually a good time for governance to allow everyone to start thinking about the rollout plan with the core system and spot market live.

Duck then brought up the topic of incorporating Thales Overtime markets as a possible market in V3 to allow stakers to delegate collateral to these markets and realize the yield. There are some Thales-specific details to work out, but it seems technically feasible according to Sunny (and some of the Grants budget has been set aside for this project).

A bonus advantage of this plan would also be that Thales would not be taking stablecoin liquidity that would have otherwise been available to other products, such as perps. LPs would therefore be minting fresh stablecoins against their collateral to be used in these OT markets only.

Lastly, there was also a SIP presentation last week — SIP-2021 to add steth/usd and wsteth/usd to Synthetix Perps. Matt presented this SIP, explaining that the motivation is to gain support for these markets that is otherwise unavailable across centralized and decentralized exchanges. They would enable typical market use cases, such as arbitrage and speculation, and have been specifically requested by Lido. Matt thinks these are very interesting pairs that nobody else really supports, and he thinks Synthetix could support them with tight caps and monitoring.

Adam brought up the fact that this will be the first market being added where the funding rate will exclusively lean one way, and it makes sense to adjust to this dynamic slowly to make sure there are no weird or unaccounted for market behaviors.

Kaleb is concerned, however, that there is no borrowing capability anywhere due to the rebase dynamic (which is primarily an issue with wsteth). He also brought up the fact that there is no liquidity for these markets on any CEXs, since they are primarily instruments for use in DeFi.

Based on some of the concerns discussed, it was decided to separate the listings into two different SIPs because a few council members expressed concern about wsteth.

Subscribe to our YOUTUBE

SNXweave Anchor Podcast: https://anchor.fm/snxweave

Follow us on Twitter! @snx_weave

SIP/SCCP status tracker:

SIP-2021: Adding steth/usd to Synthetix Perps, Status: implemented