Proposal to remove tBTCv1 gauge

Summary:

  • Threshold Network runs tBTCv1 and tBTCv2 contracts.
  • tBTCv2 bridge upcoming launch on the Threshold Network requires a proper sunsetting process for tBTCv1.
  • As part of that process the Threshold DAO proposes to remove the gauge on the current tBTCv1 Curve pool.
  • This is necessary to prevent further incentives being directed towards this pool and to encourage people holding assets in this pool to migrate to the tBTCv2 pool on Curve.
  • Pending DAO decision, tBTC v2 pool’s gauge weight will potentially be incentivized.Describe what this proposal is about

Abstract:

tBTCv2 upcoming Bridge Launch requires a process for safely phasing out the tBTCv1 token and migrating to tBTCv2.

As part of the tBTCv1 sunsetting process (outlined in Threshold’s DAO approved forum proposal) one of the needed steps is to remove the gauge on the current tBTCv1 Curve pool.
This is necessary to prevent further incentives being directed towards this pool and to encourage people holding assets in this pool to migrate to the tBTCv2 pool on Curve.
Users that do the upgrade from v1 to v2 through the Vending Machine, will receive an incentive. An additional incentive will be received to those who provide liquidity for the upgraded tBTCv2 on the Curve pool.

As opposed, if we’re not doing this Gauge removal of the tBTCv1 with its TVL going down, it currently offers one of the highest CRV APY for BTC pairs, which will further hinder migrations.

Specification:

tBTCv1 Sunsetting proposal:
https://forum.threshold.network/t/proposal-tbtc-v1-the-sunsettening/357
tBTCv1 Curve Pool: https://curve.fi/tbtc
tBTCv2 Curve Pool: https://curve.fi/factory/41
tBTCv2 Pool Creation Proposal on Curve Forum:
https://gov.curve.fi/t/discussion-migrate-tbtc-sbtc-metapool-to-a-new-tbtcv2-sbtc-metapool/2287
Vending Machine aka the tBTC Token Upgrade Portal: https://dashboard.keep.network/tbtc-migration/how-it-works
Vending Machine Instructions: https://www.youtube.com/watch?v=FJOnWai4UzE

What is the tBTCv2 token?
tBTCv2 is the ERC-20 token created from our upcoming bridging protocol (the tBTCv2 Bridge) on the Threshold Network — the network formed from the merger of Keep Network and NuCypher. This protocol will have 100x the scalability of the original tBTCv1 protocol. In addition to its intrinsic trustlessness and transparency, tBTCv2 will compete with WBTC when it comes to liquidity, convenience, and speed.

Through the tBTC Token Upgrade Portal the upgrade process is really simple: it upgrades tBTCv1 to tBTC 2. This means that every minted tBTCv2 token is backed by tBTCv1 tokens held in the vending machine contract. These v1 tokens are backed by BTC held by the tBTCv1 Bridge created for the deposit.

When the tBTCv2 Bridge is launched on the Threshold Network, anyone will be able to mint tBTCv2 simply by depositing BTC. This will be similar to minting tBTCv1, but simpler, cheaper, and with no foreseeable upper limit on minting. Our v2 tBTC bridge will be as convenient and easy to use as WBTC, but trustless and transparent — unlike anything else on the market.

Once the tBTCv2 bridge is released users will be able to mint tBTCv2 directly with BTC. This means tBTCv2 will always be backed by either BTC or tBTCv1 that is in turn backed by BTC.

4 Likes

The Threshold Treasury has been successful in our T - ETH Protocol Owned Liquidity strategy on curve, largely through the use of incentives on bribe.crv, votium and paladin.

Successfully migrating capital from v1 to v2 is important to ensure a graceful sunset.

We plan to extend the Threshold Treasury POL and incentives to include TBTC v2.

4 Likes

I agree with this recommendation. V2 should be up and sunsetting v1 is the best route to direct all legacy gauge weight for this towards v2 once it’s up and running.

1 Like