Monthly Governance Reports

December 2024 Update

Key Insights

  • New Moonwell Core Markets are being proposed. December’s governance activity was led by multiple proposals for new Moonwell Core Markets. Notably, Moonwell’s native governance token, WELL, was among the Core Markets proposed to be activated on Base.
  • The community debated OEV solutions and came to a consensus on how to move forward. Solidity Labs’ onchain solution, enabling Moonwell to capture 100% of OEV revenue from liquidation events while using existing Chainlink oracles, was overwhelmingly favored.
  • Onchain voter turnout broke new records. The community far surpassed November’s previous all-time-high voter participation on a single onchain proposal.

Primer

The monthly governance recap serves as a compendium of key governance updates for the preceding month. This update covers Moonwell governance activities for December 2024.

December maintained previous months’ trends of significantly elevated voter turnout despite a lower total number of proposals. The community largely remains supportive of launching new Core Markets and extending integrations and partnerships.

Key Metrics

  • 4 onchain proposals
  • 3 Snapshot proposal
  • 19 forum posts

The number of active voters for onchain proposals averaged 280, with a minimum of 21 and a maximum of 620.

Proposal Onchain votes
MIP-X08 620
MIP-X09 201
MIP-X10 277
MIP-R30 21

This month, there were three Snapshot signal votes.

Last month’s voter turnout on the Code4rena Snapshot proposal was the highest we’ve seen this year at 254 votes. This month’s proposal to add a WELL Core Market to Moonwell on Base came close, receiving the second highest amount of votes for a Snapshot proposal this year at 237.

Success Insights:

  • Onchain: The onchain proposals in December had a 75% success rate. Moonriver’s liquidity incentive rebalancing proposal narrowly failed to reach quorum.
  • Offchain: The Snapshot proposals in December had a 100% success rate.

Browse all of the proposals here.

Other Governance Metrics

Metric Data
Voters 4,640 (+169.40%)
Top-5 Wallets Voting Power 50% (+4%)
Top-100 Wallets Voting Power 84% (+1%)
Top-200 Wallets Voting Power 86% (+1%)
Delegate Quorum Gauge* 3 (No change)
Nakamoto Coefficient** 5 (-16.67%)
Early Voters 45% (No change)
Mid-Proposal Voters 23% (No change)
Late Voters 17% (No change)
End-of-Proposal Voters 16% (No change)
Top-1000 Delegates Active 18.73% (+0.54%)
Top-1000 Delegates Inactive*** 21.87% (-3.34%)
Top-1000 Delegates Ghost**** 59.40% (+2.80%)

*Delegate Quorum Gauge: The number of delegates required to reach quorum.
**Nakamoto Coefficient: The number of delegates required to reach 50% of the total voting power.
***A delegate is considered inactive if they have not voted on any of the last three proposals but have voted on at least one proposal in the past.
****A delegate is considered a ghost if they have never voted on any proposal.

Proposal Participation

While December had fewer total proposals than normal, the first onchain submission for the month, MIP-X08, broke the previous voter turnout record by a significant margin. As noted in the last report, MIP-X05, MIP-M41, and MIP-B35 each successively surpassed one another in hitting the #2 spot for all-time voter turnout. MIP-B36 then received 388 votes, eclipsing the previous all-time high of 282 votes in April 2023. MIP-X08 surpassed November’s new record, coming in at 620 voting wallets. This set of data may indicate that participants are eager to vote as early as possible during the month to meet the voting requirement established by MIP-X05, as subsequent onchain submissions for the month ranged from 201 to 277 for non-Moonriver proposals.

Nakamoto Coefficient

In this context, the Nakamoto Coefficient is defined as the number of delegates required to reach 50% of the total voting power. For decentralized networks such as Moonwell’s governance system, a higher Nakamoto Coefficient indicates a greater degree of decentralization. This month, the number of delegates required to comprise a majority of the protocol’s voting power has decreased from six wallets to five wallets; the total voting power distribution among the protocol’s delegates is slightly more concentrated than last month’s. This comes after the Nakamoto Coefficient previously dropped from seven to six towards the end of September.

Main Governance Initiatives in December

New Moonwell Core Markets are going live

In early December, Moonwell Super Delegate 0xMims created a forum proposal to add WELL Core Markets to the protocol. A few of the factors that preceded this effort included the token’s liquidity on Aerodrome, its circulating market cap, and the Chainlink price feed for WELL on Base going live. Shortly after, the proposal progressed to a Snapshot proposal. Following the overwhelming support shown on that signal vote, an onchain vote is expected to go live in the New Year. Around that same time, Lombard Finance created a forum discussion and a subsequent Snapshot to add an LBTC Core Market to Moonwell on Base. LBTC is a yield-bearing, liquid-staked token built on Babylon, backed 1:1 by BTC. The Snapshot was also successful and should be followed by an onchain proposal in the near future. To cap off the month, a forum discussion was created to add a Core Market for Sky Protocol’s USDS to Moonwell on Base.

The community supports extending Moonwell’s integrations

Early in the month, Block Analitica and B.Protocol submitted an onchain proposal that sought to extend and optimize the Moonwell Morpho Vaults Incentives Program for an additional six-month period and to transfer ownership of a new Moonwell Frontier cbBTC Vault to the Moonwell DAO. The new vault was designed to capitalize on the growing demand for borrowing cbBTC within the Base ecosystem. The following Thursday, the proposal was successfully passed. The Moonwell Frontier cbBTC Vault went live on December 16th, curated by Block Analitica and B.Protocol. The new vault delivers optimized, risk-adjusted returns for cbBTC depositors.

Evaluating OEV Solutions

In mid-December, new Delegate @PGov created a forum post outlining the three proposals submitted by Solidity Labs, RedStone, and API3 to help the Moonwell community assess the best path forward for addressing Oracle Extractable Value (OEV). This came after the “Great OEV Debate,” which was also covered in our last Monthly Report. Three distinct proposals from the different teams aimed at optimizing OEV capture were posted to the forums over the last month. Each proposal offered a distinct approach to improving the way liquidations are handled and subsequent revenue is captured, with varying trade-offs in terms of implementation, complexity, and security. Shortly after the forum post was created, a Snapshot went up for a vote, the results of which indicated that the community favored the solution proposed by Solidity Labs.

Risk and Rewards Speeds

Gauntlet published a forum post to adjust market risk parameters for Moonwell’s Base, Optimism, and Moonbeam deployments. The onchain proposal was created on December 18th to adjust those parameters for the next 30 days. Throughout the month, Gauntlet also published weekly updates to give an overview of asset utilization, liquidations, protocol growth, and more. Gauntlet used their role as Cap Guardian to adjust Borrow/Supply caps for assets including cbETH on Optimism. The monthly reward speed proposals, MIP-X09 and MIP-R30, each went up for a vote in mid-December; they aimed to rebalance liquidity incentives and maintain healthy levels of rewards on the four deployments. The former was successful and the latter failed to reach quorum.

Additional Developments

  • $1B Total Market Size: On the first day of the month, Moonwell hit a significant milestone. The total market size reached an all-time high of $1B, accounting for all Core Markets and Vaults.
  • The Moonwell Card: On December 9th, Moonwell announced a partnership with Cypher to launch the Moonwell Card, an advanced crypto debit card that enables users to seamlessly spend their crypto. The card is accepted at 44+ million merchants worldwide and it leverages Circle Mint for offramps; users borrow USDC against their assets on Moonwell and spend anywhere VISA is accepted.
  • Moonwell Frontier cbBTC Vault Traction: By December 17th, just 24 hours after WELL rewards went live, the Moonwell Frontier cbBTC Vault on Base reached $10M in total deposits.
  • New Isolated Market: On December 23rd, a new PT-LBTC-29MAY2025 / cbBTC Isolated Market was launched on Moonwell. The asset is Pendle Finance’s Principal Token (PT) for Lombard Finance’s Bitcoin liquid staking token, LBTC, which matures on May 29th, 2025.

Delegate Digest

Moonwell’s delegate-base is classified into three categories. Here is an explanation of what each role does and how each type of delegate can progress to the next role.

:large_blue_circle: Super Delegates

Delegate Delegation Pitch Delegation Page Delegated Amount Proposals Created Completed their role’s minimum requirements this month?
0xMims Link Link 7.2M WELL 4 Yes
Coolhorsegirl Link Link 1.6M WELL 19 Yes

:yellow_circle: Mid-Tier Delegates

Delegate Delegation Pitch Delegation Page Delegated Amount Proposals Created Completed their role’s minimum requirements this month?
Kimchiblock Link Link 303K WELL 0 Yes
PGov Link Link 201K WELL 1 Yes

:green_circle: Junior Delegates

Delegate Delegation Pitch Delegation Page Delegated Amount Proposals Created Completed their role’s minimum requirements this month?

Delegate Highlights

Community Overview

Social Channel Data
Main X account 47.4K Followers (+7.24%)
Governance X account 896 Followers (+10.48%)
Discord 9732 Members (+6.51%)
Announcements Telegram 731 Members (-4.44%)
Chat Telegram​​ 8019 Members (+1.02%)

Community Trends

December saw fewer total onchain proposals than last month but simultaneously had record-setting voter turnout. Last month, we reported that November continued to bring in massive voting numbers, with four proposals meeting or significantly succeeding October’s previous all-time high. This month, MIP-X08’s 620 participating wallets surpassed November’s record by 159.79%. The Snapshot proposals this month also received among the highest number of offchain voters ever for Moonwell, ranging from 77 to 237, although they did not quite reach last month’s heights.

The trends in Moonwell’s social media presence seen in previous months have largely continued this month: highest follower count growth on the governance X account, moderate growth across the main X account, Discord channel, and chat Telegram, and negative growth on the announcement Telegram.

Closing Summary

December 2024 broke new records in onchain voter turnout and maintained a high level of Snapshot participation. Social metrics continue to grow across Moonwell’s primary accounts and channels. The community remains supportive of new Core Market activations and expansions of Moonwell’s partnerships. The delegate-base voting power is changing slightly, and the community has debated and decided on which OEV solution to move forward with.

Be sure to attend the upcoming governance community call on Thursday, January 9th at 17:00 UTC in Discord. Add it to your calendar here.

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