Add weETH market to Moonwell on Base

Proposals Community Proposal
1

Greetings Moonwell family, Justin from Ether.fi here with a proposal for you!

Token Asset Name: weETH

Ether.fi is a decentralized, non-custodial liquid staking protocol built on Ethereum, allowing users to stake their ETH and participate in the DeFi ecosystem without losing liquidity.

The protocols eETH is a liquid restaking token (weETH is the non-rebasing equivalent),
serving as a representation of ETH staked on the Beacon Chain, which rebases
daily to reflect the associated staking rewards. Users can deposit ETH into the
liquidity pool on Ethereum Mainnet to mint eETH, hold eETH to accrue rewards,
and use eETH within DeFi or swap it back to ETH at any time via the liquidity
pool. The protocol currently employs a permissioned validator set, however we are transitioning to permissionless based on the protocol roadmap . ETH staked through the Ether.fi
liquidity pool accrues normal Ethereum staking rewards and will also be natively restaked with EigenLayer. Staking with eETH on Ether.fi automatically natively restakes that ETH to EigenLayer and accrues normal staking rewards while allowing users to keep composability on their eETH in other DeFi protocols. The eETH contract has been live since June 2023, with weETH launching to the open market on November 15th, 2023, and has approx. 1,758,428.72 ETH held within it. Being a liquid representation of staked Ethereum, the price of the token is aligned to the price of ETH. Through these mechanisms, eETH acts as a conduit for individuals to engage in Ethereum’s staking & restaking process with the added
liquidity, making it easier for them to enter and exit staking positions while also benefiting from boosted rewards.

Benefits to the Moonwell Community

Ether.fi is looking to enhance liquidity for weETH on Base. Incentivizing a Moonwell pool will continue to boost the liquidity of the LRT on Base. Higher liquidity ensures that traders and investors can easily enter or exit positions, which is essential for the overall usability and attractiveness of the LRT token within the L2 DeFi ecosystem.

Users who deposit into Moonwell will also be able to earn Etherfi points and Eigenlayer points which count towards our Season 2 community allocations!

Use cases for weETH market on Moonwell

Having weETH on Moonwell will allow users to earn Etherfi points and Eigenlayer points while supplying and borrowing against weETH. This can be done by depositing weETH onto Moonwell and borrowing Against it.

Resources (Website, Social Media Links, and docs)

• Website - https://www.ether.fi/

• Documentation -

• Github Page -

• Discord -

• Twitter - https://twitter.com/ether_fi

Decentralization

You can find the bulk of our eETH is used as backing for weETH here along with the other top balance holders listed here.

https://etherscan.io/token/0x35fa164735182de50811e8e2e824cfb9b6118ac2#balances

· Governance: -

Currently, the protocol utilizes a multi signature wallet, with the signatories
being doxxed ether.fi executives. This has changed with the evolution of the protocol, moving to decentralized governance with a DAO and a governance token.

Oracles: - The Protocol relies on an oracle for withdrawals and beacon state, however, the
reliance on an oracle for beacon state is set to go away in an upcoming
Ethereum upgrade. The Oracle is based on the hash consensus mechanism and run
by the committee members. Initially, the ether.fi team
will be the only ones to operate the Oracle nodes, however as the protocol
grows, it will add more external parties to join the committee.

The exchange rate feed for weETH-ETH on Base has been deployed by Chainlink.

Audits:

Audit reports for the ether.fi

protocol are found on the GitBook page - Audits - ether.fi. The
audits have been carried out by reputable firms such as Certik, Zellic,
Nethermind, Omniscia and Solidified to ensure the security of the protocol. An
audit competition was also recently completed through Hats Finance.

Centralization vectors: - The centralization vectors primarily
relate to the Oracle until it becomes decentralized, in line with the protocol
roadmap. The price (staking rewards for rebasing) and the validator management
(spinning up new validators and exiting them for liquidation) are also
currently centralized for the early stages of the protocol to ensure mobility.

As mentioned above, the signatories currently consist of the doxxed executive
team at ether.fi, however this has been upgraded with the implementation of the ether.fi DAO and governance.

Market History: - eETH was first deployed November 15,

  1. Market history and protocol information can be found here on the ether.fi Dune dashboard - https://dune.com/ether_fi/etherfi

Value: - The weeth pool on Moonwell is intended to serve as a primary lending source
for the token on Base. weETH will maintain the originally intended smooth trading experience, while yielding more rewards for the liquidity provider via points.

weETH on Base: 0x04C0599Ae5A44757c0af6F9eC3b93da8976c150A

6 Likes
2

Great idea, I support this one too!

2 Likes
3

I support this proposal 100 percent. I haven’t tried EtherFi or played with Eigenlayer but I know that staking and restaking ETH allows users to earn rewards and collect NFTs that allow for more incentives which is absolutely phenomenal on the Base network with very low gas fees. Thank you Moonwell for this opportunity!

2 Likes
4

This is very good proposal, I fully support this one.

1 Like
5

Hi, as a user of Ether.fi i guess it’s nice prorosal, i fully support it
but Moonwell team need to think through all the possible risks of depeg or other problems that may happen.

1 Like
6

Greetings Justin and the Moonwell community,

Thank you for presenting the proposal for integrating weETH into Moonwell. The concept of providing a liquid representation of staked Ethereum through Etherfi is indeed innovative and could offer significant benefits to our ecosystem. However, I have a few questions and points of consideration that I believe need addressing to ensure a comprehensive understanding of the implications and potential impacts of this proposal.

  1. Centralization Concerns: While Etherfi aims to transition to a decentralized model, the current reliance on a multi-signature wallet controlled by doxxed executives, and the centralization of oracle operations and validator management, could pose risks. Could you provide more detailed timelines and specific steps on how and when these centralization vectors will be mitigated? Additionally, how will the community be involved in this decentralization process?
  2. Incentive Structures: The proposal mentions that users will earn Etherfi points and Eigenlayer points for participating. Could you elaborate on how these points translate into tangible benefits for users? For example, what kind of rewards can users expect, and how will this incentivize long-term participation and loyalty to the Moonwell platform?
  3. Liquidity and Market Impact: Enhancing liquidity for weETH on Base is a clear benefit, but it also raises questions about the potential impact on existing liquidity pools and markets. Have there been any analyses or projections on how the introduction of weETH might affect the overall liquidity and trading dynamics within the Moonwell ecosystem? Ensuring that this integration does not inadvertently destabilize other markets is crucial.
  4. User Education and Support: Given that liquid staking and restaking are relatively complex processes, what educational resources and support mechanisms does Etherfi plan to provide to ensure users understand the risks and benefits? Clear and accessible information will be essential to foster informed participation.

I appreciate the effort and innovation behind this proposal and look forward to your responses to these questions. Ensuring we have a thorough understanding and addressing any potential concerns will help in making an informed decision that benefits the entire Moonwell community.

Thank you!

1 Like
7

Welcome to the community @ChaiDez , @extezymr, @Kjunior08 and @Ether.fi :vulcan_salute:

8

GM etherfi

you can find listing framework from gauntlet here Moonwell Asset Listing Framework v2

H

aving weETH on Moonwell will allow users to earn Etherfi points and Eigenlayer points while supplying and borrowing against weETH. This can be done by depositing weETH onto Moonwell and borrowing Against it

sure about this ? I hodl some weETH for the Points but when I lend it then someone else get the points :man_shrugging: :man_shrugging: idk :sweat_smile:

9

I agree with any listing of ETH that is safe and verified. My only concern is to have the info for members to check on it on the website. It can be confusing to find the source of this coin, and personally I think the forum has more info than the website itself when someone wants to check on the coin. Hopefully the team can add that feature.

10

Hi EtherFi team,

I would appreciate it if you would include the information requested in the Moonwell Asset Listing Framework, so the community can properly evaluate this proposal.

1 Like