Proposal to Whitelist Liquity’s Treasury Multisig Contract

Summary and Abstract

This proposal aims to whitelist the Liquity Treasury (Gnosis Safe), enabling it to lock CRV, participate in Curve gauge and governance votes, and benefit from the LP boosting. Unlike similar proposals, such as the recent Abracadabra’s mCRV, there will be no wrapper.

CRV tokens used for this process are not deposited by users. They are/were acquired on the markets (and might be farmed in the future). To date, Liquity purchased ~530K CRV, and further acquisitions are planned. \

  1. Whitelist Liquity’s Treasury contract in Curve’s SmartWalletList, in order to take part in the governance process and lock CRV.
  2. The available 530K CRV will be vote-escrowed for four years. The gauge voting power will be initially used 100% to support the LUSD pool.
  3. Further CRV acquired will be vote-escrowed for four years as well.
  4. The veCRV balance will also be used to partake in relevant governance votes for Liquity and might be used to boost self-owned liquidity in the future.

Introduction to Liquity

Liquity is a protocol offering interest-free leverage on ETH. The LUSD stablecoin, output of the system, offers some genuinely unique features, the leading one being the trustlessness of the whole Liquity protocol. In that sense, LUSD is one of the most resilient stablecoin and the most decentralized.

Project: https://liquity.org/

Twitter: https://twitter.com/liquityprotocol

Documentation: https://docs.liquity.org/

App (list of front-ends): Liquity | Frontends List - Use Liquity

Discord: Liquity

Liquity x Curve Finance

The Curve LUSD pool has been the main trading venue for LUSD almost since the protocol’s inception. It’s one of the stablecoin pools featuring the highest organic volume and APR. Thanks to the relatively high vAPY, the pool has enjoyed significant deposits and spontaneous gauge voting since its inception. However, to keep growing the pool and keep it balanced, the team is now taking a more active approach to supporting it.

While the LUSD Curve pool is the focus right now, other pools are being considered, such as a v2 pool for LQTY or pools related to an upcoming product.

Motivation

The LUSD Curve pool is among the top-performing pools volume-wise and often sees more daily volume than the MIM or FRAX pool, despite its lower TVL. If the Liquity treasury is whitelisted, this pool will be further supported with increased CRV emissions and potential bribes for gauge voters.

While Curve is a massive success as a stablecoin trading venue and DEX overall, we believe it’s essential for Curve to offer stablecoins with different risk profiles, as the currently most liquid stablecoins share similar shortcomings:

  • Stablecoin models with centralization-related risks (USDC, USDT)
  • Stablecoin models with censorship-related risks (DAI, FRAX, MIM)
  • Stablecoins models with sizeable centralization, liquidity, design, and ethical issues (UST, USDD)

Liquity’s code is immutable, and no trust-required assets are used to back LUSD (ETH only), so its risk profile is vastly different. We believe that growing liquidity on alternative stablecoins is a net benefit for Curve in the long term.

Proposal

This proposal intends to allow the Liquity treasury (Gnosis Safe) to participate directly in the Curve Wars with no intermediaries by self-locking CRV. The gauge voting power obtained will initially be 100% dedicated to the LUSD pool. The treasury will also exert its governance voting power for the best interest of both Liquity and Curve Finance.

Specification

Curve DAO whitelisting the following smart contract to allow locking of CRV, gauge voting, governance voting and boosted LP rewards:

Liquity Treasury (Gnosis Safe):

0xF06016D822943C42e3Cb7FC3a6A3B1889C1045f8

Disclosure

I, TokenBrice, am one of the top French🦙 documenting the Curve ecosystem. I’ve also recently joined the Liquity team to help with growth and DeFi strategies.

Voting/Poll

  • For
  • Against

0 voters

5 Likes

Obvious yes, but for clarification: please detail who owns which address in the multisig (if applicable). I see it’s a 2/4 multisig, controlled by other multisigs?

5 Likes

Yes, welcome to the Curve wars! I would love to see that happen… Just some follow up questions:

Is that a typo? should it be ~530k CRV as stated in the intro, or am i missing something?

Is that a new product from liquity (different from LUSD?) or a upcoming partnership with an existing protocol?

Indeed it’s a 2/4 multisig wallet, signers are all team members or investors, all EOAs. We’d like to avoid revealing too much information on the setup, but since this is a Gnosis Safe, the risk for Curve is quite limited.

@FrenchTony indeed this was a typo regarding the amount. The current balance is 530K CRV, we acquired some more yesterday which got me confused.

I cannot share too much yet on the upcoming product but there will be news on that front coming this month, it’s a new product made by Liquity, developing synergies on LUSD first, and then LQTY and eventually pretty much any token.

Strongly support!
Liquity is the best lending protocol created so far.

I support it as well. Will there be an official veCRV vote on this?

The Gnosis Safe will allow you to enable a module later and tokenize CRV without undergoing the current scrutiny that whitelisted protocols go through. The risk team would like to make it clear to any protocol with whitelisted Safe that going beyond the original stated purpose of treasury management is considered abuse and will result in a proposal to remove whitelist privilege.

Can we get agreement from Liquity that the whitelisted Safe will only be used for treasury management and not be used as part of a larger set of smart contracts to circumvent the whitelist?

2 Likes

Hi @chanho

Yes, we are 100% aligned there, this is what I wanted to stress in the initial proposal by stipulating that “there will be no wrapper”. I wasn’t sure of the best way to guarantee this for Curve, but the agreement seems like a sound way of doing it.

We can guarantee that the safe will be used for what has been stated in the proposal only: “personal usage of veCRV” for the benefits of Liquity (3CRV yields, LUSD pool gauge vote, Curve governance vote, and maybe LP boosting). Considering the CRV used are CRV acquired by the treasury, I don’t think we will ever want to expand more. However, if the bug bites us and we’d like to enter the wrapper-race one day, we will consult the Curve community first and most likely use a different contract, as this one is a the treasury safe.

2 Likes

I support all things Liquity. Will vote Yes.

Awesome. Glad to hear we are aligned and thanks for the quick response.

1 Like