Proposal to add msETH/frxETH to the Gauge Controller


Proposal to add the msETH/frxETH pool to the Gauge Controller.

References/Useful links:

Protocol Description:

Per recent Frax governance proposal, this pool pairs Metronome’s synthetic ETH (msETH) with Frax’s ETH stablecoin (frxETH). Metronome’s msETH is a loosely pegged CDP. Metronome offers a system that primarily enables users to mint synthetic assets against productive collateral.


This pool reflects a substantiated partnership between Metronome and Frax. Frax’s yield-bearing sfrxETH is supported collateral on Metronome. This pool enables deeper liquidity for Frax users to perform looping yield farming and additional LP strategies on top of their existing sfrxETH position. Both protocols will be engaging in a 1:1 vote matching program for several vote cycles, as proposed by Metronome and approved by Frax governance.


Llama Risk provided a comprehensive overview of risks associated with Metronome Synth roughly one month ago. The main security concerns are as follows:

  • Degree of Centralization - Currently, Metronome treasury and operations are controlled by administrative multi-sigs. The report references an intention to move towards a future Token Lockup model for on-chain governance. Since this report, these contracts have returned from audit and mainnet testing is in progress.
  • Time in Market; User Adoption - Metronome Synth has only been live since January (and is still in Beta). User TVL was low and the system had not been tested under extrenuating market conditions. Since then, TVL has trended up steadily - see DeFi Llama dashboard - and Metronome Synth was not negatively impacted during recent stablecoin depeg situation.