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Governance Call Recap - Apr 4th, 2024

  • Date: April 4, 2024
  • Time: 5pm UTC
  • Moderator: @alex. from @Boardroom
  • Recording Link: YouTube

Agenda:

  1. WETH, wstETH, and cbETH cap increases from @Gauntlet
  2. Base/Moonbeam/Moonriver Recommendations (March 26th) from @Gauntlet
  3. MIP-M21, MIP-M23/MIP-M24, & MIP-B16 from @elliot
  4. Rewards speeds and $PINK airdrop updates from @Curly
  5. Conclusion from @majin

Meeting Notes:

  • @alex. from Boardroom introduced the speakers and gave a few pieces of housekeeping information before diving into the main points of the meeting. First, multichain governance is live and a great explanation on how to migrate to the new WELL token was put up by @Chrizy on Discord. Second, Alex noted the increased number of proposals that went live in March and commended the community for consistently reaching quorum. Lastly, he announced an upcoming Galxe NFT campaign that will encourage voting on Base now that native WELL is supported. There will be a drawing of the NFT holders and the winners will receive a USDC reward. There will be an official announcement in the future detailing the specific criteria for minting the “Based Voter” NFT.
  • Sai from Gauntlet on WETH, wstETH, and cbETH cap increases
    • As Cap Guardian, Gauntlet has the ability to quickly and efficiently make changes to asset supply/borrow caps without the need for a governance proposal. Recently, they adjusted borrow & supply caps for WETH, wstETH, and cbETH on the Moonwell Base deployment due to a large demand for these assets.
    • Here are the adjusted market caps:
      • WETH Supply Cap from 22,000 to 24,000
      • WETH Borrow Cap from 16,000 to 20,000
      • cbETH Supply Cap from 6,000 to 7,200
      • cbETH Borrow Cap from 1,800 to 2,100
      • wstETH Supply Cap from 3,000 to 4,000
      • wstETH Borrow Cap from 900 to 1,250
  • Sai from Gauntlet on Base/Moonbeam/Moonriver Recommendations from March 26th
    • These updates are meant to adjust asset parameters (e.g. collateral factors and borrow caps) to balance risk and capital efficiency. The most recent update recommended the following changes:
      • Base: Five risk parameters were recommended to be changed: WETH supply and borrow cap (12,500 to 18,000 and 10,500 to 14,000, respectively), wstETH supply and borrow cap (1,800 to 2,100 and 800 to 900, respectively), and USDbC RF (15% to 20%). For IR parameters, only USDC had any recommendations: kink (0.8 to 0.9), multiplier (0.032 to 0.067), and jump multiplier (4.2 to 9.0).
      • Moonbeam: Seven risk parameters were recommended to be changed: xcUSDC and WGLMR collateral factors (10% to 15% and 58% to 57%, respectively), WGLMR borrow cap (22,500,00 to 10,000,000), WBTC.wh borrow cap (50 to 5), WETH.wh borrow cap (500 to 100), and the reserve factors for xcUSDT and xcUSDC (20% to 25%, each). For IR parameters, four assets were recommended changes: USDC.wh (an increase in multiplier from 0.0845 to 0.0875 and an increase in jump multiplier from 7.2 to 7.4), xcUSDC (an increase in multiplier from 0.0814 to 0.0875 and an increase in jump multiplier from 7.0 to 7.4), xcUSDT (an increase in multiplier from 0.0814 to 0.0875 and an increase in jump multiplier from 7.0 to 7.4), and FRAX (an increase in multiplier from 0.01 to 0.0563 and an increase in jump multiplier from 0.01 to 4.0).
      • Moonriver: Three risk parameters were recommended to be changed: FRAX reserve factor and collateral factor (15% to 25% and 57% to 53%, respectively) and WMOVR borrow cap (40,000 to 20,000). Only one IR parameter change was recommended for FRAX (increasing the multiplier from 0.0814 to 0.0875 and the jump multiplier from 7.0 to 7.4).
  • Elliot on MIP-M21
    • To start, Elliot summarized Solidity Labs’ efforts from the past four months. The broad goal was to make WELL natively multichain, giving the asset voting rights and the ability to be staked in the Safety Module on Base. Should the community decide to move in this direction, these changes enable the WELL token to be used on chains other than Base.
    • A series of proposals were created to enable multichain governance. In preparation for upgrading WELL to the xERC20 token standard, Solidity Labs proposed MIP-M21 to upgrade the Wormhole Bridge Adapter on Moonbeam. The upgrade was meant to improve the user experience of bridging by automatically unwrapping WELL (xERC20) back to the original Moonbeam WELL token on transfer. He then touched on the technical details of Wormhole message passing. Because the native WELL token is not tied to any one bridge provider, it’s possible to use other bridges (such as Axelar) in the future. Finally, Elliot touched on the security of this upgrade process; he recognized and fixed a potential DoS attack vector while implementing the changes. See the forum post above for more detailed security considerations and codebase changes.
  • Elliot on MIP-M23/MIP-M24
    • Following the passing of MIP-M21, Solidity Labs proposed MIP-M23 and MIP-M24: Multichain Governor and WELL Migration. This pair of proposals sought to move from Compound’s Governor Alpha smart contract to the new cross-chain governor, create xWELL, accept ownership of the contracts, and finalize the new governor’s abilities. To do this, Solidity Labs set the pending owners from the old Artemis timelock to the new multichain governor. MIP-M23 was executed from the Artemis timelock and MIP-M24 was executed from the new multichain governor contracts; the latter had to happen after the passing of the first. The multichain governor allows voting participation on multiple chains. It’s deployed on Moonbeam and there is a vote collection contract on Base. Finally, Elliot gives a “voting flow” example of how creating a new governance proposal would work.
  • Elliot on MIP-B16
    • Proposal #4 in this process was MIP-B16. This prop sought to enable rewards for users in the Safety Module with the new WELL token on Base. The Safety Module helps to backstop and secure the protocol, rewarding users in the process. If there happened to be a loss on Base, the DAO could vote to apply a haircut to all stakers, making sure the protocol remains healthy. With this proposal, users can earn some yield for contributing to protocol security. This was the final proposal needed to fully activate all components of multichain governance. With all four proposals passed, WELL holders on Base can backstop the protocol, earn rewards, and have a voice in governance.
  • Elliot’s miscellaneous updates
    • A new native WELL WETH pool was created on Aerodrome. The rates in the pool are currently high due to a WELL token rate limit.
    • Moonwell is offering gas subsidies for users to migrate to native WELL.
    • MIP-M22 passed with a good voter turnout. The Solidity Labs team is currently working with the Nomad team to mint an NFT and then bridge and redeem the underlying assets.
  • Curly on the $PINK Airdrop Application and rewards speed
    • In March, Curly submitted his monthly rewards speed proposals (MIP-M20 and MIP-R14). The main takeaway here is that the DAO is moving rewards away from USDC.wh towards the new xcUSDC.
    • An application went live on the Moonbeam forums for projects to get a share of a community redistribution of $PINK. Of the 1.25% total supply of $PINK that was allocated to Moonbeam, 50% was reserved for deployed Moonbeam projects with active users. Curly gave an update on his effort led on behalf of Moonwell to receive an airdrop of $PINK. The write-up on the Moonbeam forum for this airdrop proposal can be found here and the successful application can be found here. Curly announced that the $PINK airdrop campaign should be launching within 24 hours. There will be opportunities to get a share of the airdrop once it goes live, such as supplying liquidity to the GLMR or DOT markets and supplying WELL to the Safety Module. The details on the airdrop amounts will be announced shortly.

Other Links:

View the Slides here.

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