Proposal to add sdTokens tokens pools to the gauge controller

Summary:

Proposal to add 3 pools : sdCRV/CRV, sdFXS/FXS and sdANGLE/ANGLE pools to the gauge controller.

References:

Stake DAO:
Website: https://stakedao.org/
Documentation:Introduction - Stake DAO
Github Page:Stake DAO · GitHub
Twitter/Discord/Telegram: https://twitter.com/StakeDAOHQ/ - Discord - Telegram: Contact @StakedaoHQ

CRV:

sdCRV Factory pool: Curve.fi
sdCRV gauge: https://etherscan.io/tx/0xe37d2b61ff55d5193fc8b51c10fc1a0b5e0f51bfb40b711c053a2b7dbf51b68e/

FXS:

sdFXS Factory pool: Curve.fi
sdFXS Gauge: https://etherscan.io/tx/0x8d2c860995b4f01faf44a566835c0633e5fc5c9ccc56e81fb82859bfcd169d56/
Website: https://frax.finance/
Documentation:Introduction - Frax Finance ¤
Github Page:GitHub - FraxFinance/FraxFinance.github.io: Main Website Source Code
Twitter/Telegram:https://twitter.com/fraxfinance - Telegram: Contact @fraxfinance

ANGLE:

sdANGLE Factory pool: Curve.fi
sdANGLE gauge: https://etherscan.io/tx/0xdd1703df5dd9e8c3a2b89219158217fd4b3bf12e526b7f077406420dfe0823d7/
Website: https://www.angle.money/
Documentation:Angle Documentation Portal - Angle
Github Page:Angle · GitHub
Twitter/Discord :https://twitter.com/AngleProtocol - Angle Protocol

Abstract:

Stake DAO is a non-custodial platform built on top of decentralized protocols that enables anyone to easily grow their crypto portfolio. The TVL of the protocol is above 630M$, spread out across chains where the Curve ecosystem is already present. Stake DAO recently released a new feature called the Liquid Lockers that will help accelerate the lock of CRV and other veTokens.

It’s a new feature built for tokens with ve-model allowing users to keep a liquid position while enjoying some yield and the associated voting power (which can both be boosted with veSDT)

CRV/FXS/ANGLE holders depositing into liquid lockers will receive sdCRV/sdFXS/sdANGLE that can either be staked into a reward contract to receive several sources of yield while keeping the voting power and a liquid position, or deposit them in the associated strategy (sdCRV/CRV - sdFXS/FXS and sdANGLE/ANGLE Curve LP). You can find more info on this new product in this medium post: Introducing Liquid Lockers & veSDT | by Stake DAO | Feb, 2022 | Medium

Frax Finance is the first Fractional algorithmic stablecoin with 2.35B$ TVL to introduce the idea of fractional backing with a novel market-set mechanism to find the ideal collateral ratio. The FXS governance token has a similar design to Curve’s CRV model.

Frax recently got one gauge on the cvxFXS/FXS pool with 152M$ in liquidity, earning some protocol fees.

Angle is a decentralized stablecoin protocol. The protocol has launched agEUR, a Euro stablecoin, two months ago. The protocol has so far got two gauges on Curve for two different pools (3EUR and ibEUR-agEUR) which both generated some fee revenue. The protocol can technically launch stablecoins pegged to any kind of asset, Euro being the first one. It is governed by a token: the ANGLE token which recently adopted a ve model, similar to Curve’s one.

Motivation:

Stake DAO recently released the CRV, FXS and ANGLE liquid lockers, allowing Curve, Frax and Angle users to deposit their governance tokens to mint sdTokens, and the associated strategy based on the sdToken/Token LP.

Having gauges that earn CRV would boost the liquidity in these pools, which allow users to keep their investment liquid, while enjoying yield and voting power. Basically, we expect these pools to be used as the exit liquidity for people wanting to sell their sdtokens, and for entry liquidity for people wishing to buy sdtokens at a discount.

These gauges would bring value to Curve, Frax, Angle and Stake DAO communities.

Additionally, both liquid lockers and associated strategies have gauges for SDT rewards. These gauges are controlled by $veSDT holders.

Specifications:

1. Governance: Provide current information on the protocol’s governance structure. Provide links to any admin and/or multisig addresses, and describe the powers afforded to these addresses. If there are plans to change the governance system in the future, please explain.

The governance of Stake DAO is currently off-chain using Snapshot. The multisig address is: 0xf930ebbd05ef8b25b1797b9b2109ddc9b0d43063

Any decision regarding SDT inflation, liquidity, partnership or DAO treasury goes through a DAO vote, and then it’s executed by the multisig.The protocol will switch to on-chain inflation soon after veSDT goes live, and on-chain governance will come at a later stage.

There are so far 4.3m CRV, 46k FXS and 7.5m ANGLE tokens locked on StakeDAO.

2. Oracles: Does the protocol rely on external oracles? If so, provide details about the oracles and their implementation in the protocol.

No external oracles.

3. Audits: Provide links to audit reports and any relevant details about security practices.

FXS locker audit: https://drive.google.com/file/d/1WHrtRali0hfECzGISRFBcJgAKZO3-iKD/view?usp=sharing

ANGLE locker audit + veSDT contract: https://docs.google.com/document/d/1-KJHIolcuHawQUlhGzVN9eb9DJJ5tCzsF9LIlzTSrYA/edit

Answer from Stake DAO yet to be reviewed: https://docs.google.com/document/d/1Ylo5A77OQFgen9yxHHURybxFPEq8YV87nH1LxIAUw4c/edit

CRV locker audit coming soon.

4. Centralization vectors: Is there any component of the protocol that has centralization vectors? E.g. if only 1 dev manages the project, that is a centralized vector. If price oracles need to be updated by a bot, that is a centralized vector. If liquidations are done by the protocol, that is also a centralization vector.

Incentives are currently updated manually each week according to a voted formula. Soon after the $veSDT launch, inflation allocation will be voted on-chain so fully decentralized, while total inflation will be updated on a daily basis thanks to a bot applying a public formula depending on on-chain metrics. All strategy management will be decentralized thanks to a “Harvest fee” allowing any user to call the earn and harvest functions in exchange for a share of the performance fees.

5. Market History: Has the asset observed severe volatility? In the case of stablecoins, has it depegged? In the case of an unpegged asset, have there been extreme price change events in the past? Provide specific information about the Curve pool: how long has it been active, TVL, historical volume?

CRV:

Except for the listing where the volatility was extremely high, the CRV price has been in a range between 1$ and 6$ for 16 months.

The sdCRV/CRV factory pool was deployed on April 13th

There is already 900K$ in the sdCRV/CRV pool for now.

FXS:

Except for the listing where the volatility was extremely high, the FXS price has been in a range between 2$ and 10$ for 9 months, experiencing relatively low volatility, before starting a new range between 15$ and 25$ in the past four months.

The sdFXS/FXS factory pool was deployed 6 weeks ago.

There is only 43.6K$ for now, however Stake Dao plans to progressively increase the liquidity with the help of Frax in the coming weeks.

ANGLE:

The sdANGLE/ANGLE pool was deployed 6 weeks ago. There is only 36K$ of liquidity for now however Stake Dao plans to progressively increase the liquidity with the help of Angle in the coming weeks.

Except for the listing where the volatility was extremely high, the ANGLE price has been in a range between 0.78$ and 0.13$ for the past 5 months.

Voting options:

  • For
  • Against : sdCRV/CRV, sdFXS/FXS and sdANGLE/ANGLE should not have a gauge than can earn CRV
  • Abstain

0 voters

The proposal has not already been created.

The goal of this post is more to measure the community’s feeling about adding a gauge for this pool. Proposal should be created soon.

32 Likes

Super in favor of it! On the Angle Protocol side, I am convinced that a sdANGLE-ANGLE gauge would help increase liquidity and hence volume in the pool.
Many people are not locking on StakeDAO’s locker because liquidity in the pool is not that big at the moment. Bigger liquidity would incentivize more people to lock and hence drive more volume. On the other side, it would make it more interesting for arbitrageurs getting sdANGLE at a discount

Disclaimer: I am an Angle Core Team member

21 Likes

Full support on this proposal :fire:

The liquid lockers are a very interesting feature for every veToken holders, I’ll vote a huge yes !

21 Likes

Maximum support on this proposal!

13 Likes

All I can say is LFG on this one.

14 Likes

excellent proposal, full support, LFG!

12 Likes

The Liquid lockers are bringing a new innovation to the ve-tokenomics. I support this proposal and am excited to see the Liquid Lockers grow!

12 Likes

LFG! The introduction of Liquid Lockers is opening new doors, looking forward to the future!

13 Likes

Big opportunity for Curve: a new locker that do not centralise the voting power. Good for Curve, decentralisation, and defi as a whole.
Also a good proposal to support as the whitelist suppression proposed by the team a few months ago didn’t pass.

21 Likes

Can you fix the links in the “audits” section?

4 Likes

Hi, i don’t know why i can no longer edit the proposal.
Below are the fixed audits links:
FXS locker audit: https://ipfs.io/ipfs/Qmf6y8tX3CuZgDFkE3BUoxSSE2PsCG5N8zGNHejbyVkqwf
ANGLE locker audit + veSDT contract: https://ipfs.io/ipfs/QmeFv7ZHqXnHuRiPm7k7JfUYn4XhzYTbAydavNfHqMLPLa
Answer from Stake DAO yet to be reviewed: https://ipfs.io/ipfs/QmUJG4ezFMP6faqT7UKxzTp1cWDLxTb8J6uKznEwK7zyX1

11 Likes

This is NOT a good idea and I would encourage the protocol to vote against this proposal. This would fracture liquidity away from the Convex Platform’s cvxCRV + fxsFXS liquidity tokens.

StakeDAO has a whitelist so they have the right to lock and issue liquidity tokens themselves. However, it is clear to me that StakeDAO does not care about the value to their token holders…they care about the value of their token holder’s locked curve for voting power. These two are not the same. StakeDao’s liquidity token lost the race for yield and adoption last year. This proposal would allow bypassing of the white list potentially opening the protocol up to bad actors.

Lastly, I think that allowing incentivization of another liquidity token would be disingenuous to noob defi users as it would cause confusion in the space since they would not understand that not all liquidity tokens are the same or that StakeDAO has a bad reputation for token value.

16 Likes

Very excited about this proposal, full support !
Looking forward to see the liquid lockers thrive

5 Likes

-1 from me; Actually I am super against this proposal. The whitelist is there for a reason, opening the door to rogue governance.

9 Likes

I do not agree with this proposal and would vote against it. veCRV has been a strength of Curve and has allowed the program to make long term decisions. Changing the structure now after such incredible success seems reckless. Solid no vote from me.

8 Likes

This is a Trojan horse. The main purpose of this proposal is to bypass the whitelist and open up a direct bribing service for Curve governance. Do not vote for this.

To the authors - Can you explain how you will protect against a flash loan attack where an entity could establish a massive amount of veCRV governance power and then immediately exit the position? The 4-year lock is to ensure that those with the most power are those most invested in the long-term success of Curve. Your proposal completely removes this incentive. Can you explain why you believe this incentive should no longer exist?

The outcome of this proposal would be to strip bare the protections on the so-called “Heart of DeFi” (StakeDAO’s words, not mine) and allow any big bad wolf to do as they please. This proposal is not good for Curve. Do not vote for it.

7 Likes

I am fully support StakeDAO proposal and going to vote For. Convex made a great job during last year, but now Convex looks like Trojan horse for Curve gov and a lot of players already “play” with “liquid veCRV” in form of CVX without whitelisting. We need more Trojan horses like Convex (CVX) and StakeDAO (liquid lockers) to make Curve stronger. We are should vote for benefit future of Curve not just Convex share.

18 Likes

Hey 0xLeibniz
Pretty easy to avoid flashloan governance attacks: just need to take a snapshot date which is in the past compared to the transaction pushed on snapshot. This is already what we do: the snapshot block is the same as on Curve so that people can’t have double vote and can’t use MEV to flashloan attack the governance.

10 Likes

This is a great proposal for Curve as it provides another offering to maintain the value of veCRV as against the current model where the utility of the Curve token is stripped away and abstracted into the Convex token in exchange for higher deposits to Curve. Though beneficial to scale Curve to an extend more recently we’ve seen that DAOs and individuals alike see the only option to go on Convex, dump CRV rewards for CVX or scale into cvxCRV growing the power of CVX and so on…

As a result there is a centralisation of Curve, through excellence in execution, we’re already at a point where Convex control Curve in totality. It’s irresponsible for us to think the centralisation of Curve into a demi-dao is something to just accept and never question.

These pools offer an alternative to Convex, reducing the % of relative voting power and will hopefully help to decentralise Curve rather than maintain the monopoly. The permissionless aspect is maintained since no power is abstracted away from the Curve token into another token printed at will with a team allocation. Therefore, we are in a situation where Curve governance is controlled by users with aligned incentives and we do not end up in a situation where a team can mint themselves an allocation (deserved or not) that gives them huge control over curve through abstracting away governance power from user Curve deposits into the pockets of the team.

Ultimately Convex designed a great flywheel that helped to scale Curve but Curve is big enough now that it does not need “helpers” and secondly the “helper” is now bigger than the DAO itself which threatens the existence of the DAO itself.

The status quo where Curve, Curve governance, and the Curve token are all second to Convex is net negative for the ecosystem. Let it be clear it is not convex itself that is bad but rather the monopoly Convex has over Curve that is now a danger to Curve itself. Anyone that has studied high-school econ knows monopolies are to the detriment of innovation, user value and the ecosystem as a whole for the benefit of a select few in power.

The narrative should not be Convex vs Stake DAO but rather focus on ensuring the success of Curve to prevent it’s centralisation and maintain an infrastructure that can scale to the size of something like the “tradi” Forex market. It is not possible to see this future come to light in a world where Curve as a service provider is open to all but Curve as a DAO is controlled in totality by another entity.

Stake DAO has been one of the first and strongest proponents of Curve and has endlessly supported the Curve ecosystem, this view is not one that will change. Curve is the central pillar of DeFi and by providing an alternative to Convex that maintains the power of veCRV rather than abstracting power away from it into another token whilst reducing monopoly power can only be a good thing.

30 Likes

The opposition to this proposal seems very tribal and somewhat blinded to the increased demand this will bring to Curve.
I shall be supporting this proposal

14 Likes