Prop 641 gives 20M to a multisig to provide POL liquidity on stOsmo/Osmo. However this is way too much. There is no rationale for the need of this amount of liquidity. Absent of this rationale, the OSMO should be returned to the community pool. This is a signaling prop for the multisig in prop 641 to return 17M OSMO to the community pool.
Some problems with the current proposal is that it dilutes stakers with over 6% of all staking rewards that would go towards incentivizing people from purchasing the token and staking to now just going to the community pool (we already distribute osmo to the community pool daily). Further, we are paying stride approximately $30k per year for this when it simply is not needed.
The goals of prop 641 could be achieved with a lot less OSMO. This prop (3M OSMO) would still represent 1% of all staked OSMO would be used for these purposes. For context, the 3M OSMO increases the amount of osmo in the pool by more than 150% than what is currently in the pool.
Voting Yes would require the multi sig to return 17M OSMO to the community pool.
Assuming prop 641 passes, this should be a no with veto.
This amounts to proposal spam by a validator who disagrees with the first proposal, and so is putting up another proposal to try and get the result he wants.
Governance (again assuming 641 passes) has made its opinion known on this matter. Just because you don’t like the outcome doesnt mean you should continue to put proposals up until you get the result you want.
I think if 641 passes it should certainly be revisited especially since the text explicitly says this should happen. but I see the point here that there should probably be a gap.
In the future Osmosis governance may or may not wish to redeploy this OSMO POL liquidity directly to a supercharged stOSMO/OSMO pool or to a Quasar vault built on top of a supercharged pool. But for Osmosis’ first experiment in providing a large amount of OSMO POL, doing so in the simplest and safest way would be best.
Perhaps this should be proposed after the ability to transfer a Supercharged position exists to remove any concerns about custodial management which seemed to be a major driver of the proposed pathway. Increasing the efficiency should almost certainly come with a decrease in the quantity.
I stand by my statement that proposal 641 as written is far better for Stride than it is for Osmosis rather than being equally beneficial and strongly believe that we should be going straight to the Supercharged pool with a smaller amount.
Not only the result desired by 1 validator, but by a complete set as well as multiple prominent persons around Osmosis.
Normally I would surely agree with you that passing governance means it has to be executed (taker fee anyone?), but the risk of actually executing the outcome of this proposal just puts Osmosis at an unacceptable risk, so I surely support this specific case.
It is not that it is tried to completely revert the outcome, only temper it.
I am curious how fast the multi-sig will act with executing prop 641 though, knowing that this is being discussed as well.
In principle the multi-sig is allowed to start executing the plans, ethically it would be good to wait for the outcome of this one as well though.
Very close vote (51-49). From what I can see, the only reason why it was a close vote was due to size. Osmosis does not have multiple choice option which probably been optimal for this type of proposal. For this reason, more discussion should be had on size and Osmosis stakers should be given more options here.
Stride being acquired by Atom. This was announced 1 hour before the end of this proposal. Do Osmo stakers feel differently about giving away 7% of governance power to stride now that stride token is no more and it will be acquired by Atom? If we give away this power to atom, will atom also cannabolize Osmosis? Is 1% voting power too much to give them given this situation?
I had kinda a crazy thought here. Please nobody get angry or throw things. I haven’t talked to anyone from the multisig, Stride, the Hub, or Osmosis about this. Was literally just a random thought I had. Feel free to tell me it’s a bad idea but do so kindly
What if this was a treasury swap for an equivalent value of ATOM instead?
There’s literally a proposal live on the Hub forum right now for an almost equal amount of ATOM POL. Both protocols could each own eachothers’ POL and would get something significantly concrete from the POL creation (which I know has been a concern in this forum).
The Hub would get OSMO POL, closer alignment with Osmosis, and additional revenue for one of its consumer chains.
Osmosis would get ATOM POL, closer alignment with the Hub, and all of the liquidity (both the ATOM and OSMO liquidity) would live on Osmosis. Feels like a huge benefit to both protocols. I raised this as a question in the Hub forum post as well to see what people thought.
I still think some questions need to be addressed about the acquisition announcement today, as well as some other issues with the size of this ask that were brought to my attention today. Like I said, haven’t had the chance to talk to anyone about this yet, but wanted to get the idea out there before it floated out of my brain. It’s been a bit of a long day.
Since prop 641 has now passed, let me quickly give my thoughts on this effort to subvert it.
If there were a second vote on prop 641, I think it would severely damage the credibility of Osmosis governance. Going forward, no one would have confidence in Osmosis governance decisions, fearing that governance might attempt to reverse them. Osmosis governance is a hugely important institution, and in order for it to continue to function properly people have to respect its decisions.
You can’t say “Osmosis governance made the wrong choice” just because you think it was the wrong choice. Prop 641 passed with majority support; 72,000,000 OSMO voted for it. Validators and OSMO holders carefully considered the proposal and considered the thorough discussion on the forum - and they ended up in agreement with the proposal.
Osmosis governance approved of the idea to deploy OSMO POL in a safe, simple, and secure way. This certainly isn’t the most efficient way OSMO POL could be deployed - but governance has made it clear that it wants to optimize for safety, simplicity, and security over efficiency.
I think that for the time-being Osmosis governance should not attempt to change prop 641, as nothing material has changed since the prop was passed. But I do agree with @JohnnyWyles that once CL positions are transferable, then maybe governance should revisit this decision. If a CL position could be transferred to the Osmosis community pool, then an OSMO liquidity position would have less legal and trust risk - which I think is what Osmosis governance wants.
@RoboMcGobo also raises an interesting idea. Although, on that note I want to stress that the potential STRD <> ATOM token conversion isn’t something anyone should plan for or expect. It’s merely a possibility, which may or may not happen.
To address some of the concerns that have been raised, if I were to write such a follow up proposal to Prop 641 it would be to:
direct the multisig to not deposit more than 20% of the 20 million OSMO (20 million) into the pool before 11/15/23 to provide an appropriate amount of time for a CL pool to be created and the opportunity for governance to determine if it would prefer deploying community pool OSMO to such a pool rather than the current stable swap pool.
if on 11/15/23, governance has not passed any further proposal providing further direction to the multisig, the multisig shall deposit up to another 20% into the pool dependent upon the multisig, Stride or some other entity or individual having completed and submitted to the Agoric community the ECs collateral asset application form and request of Gauntlet has any recommendation on the $ value liquidity the stOSMO/OSMO pool for stOSMO to be an IST collateral asset.
the multisig can deploy up to 30% of the 20 million OSMO to the stOSMO/OSMO pool to meet Gauntlets recommendations if governance has not provided it with any further directions by then.
the multisig can deploy up to 30% of the 20 million upon Stride increasing the number of host chain validators it delegates OSMO to from 32 to a minimum of 40 if governance has not provided any further directions.
return any remains OSMO to the community pool.
provide governance with quarterly status updates, which should be posted here no later than the second Monday of the quarter, and include an account of how much swap fees have been collected.
send earned swap fees on a quarterly basis to the community pool minus 1.75 OSMO. As a sign of appreciation for volunteering their time to complete the aforementioned tasks, each multisig member is to receive 0.25 OSMO a quarter (before tx fee).
Such a proposal would clearly be more of a clarification proposal providing the multisig with clearer directions on how to proceed with deploying the 20 million OSMO since Prop 641 is completely silent on such matters. Multisig members shouldn’t have to guess how governance wanted them to proceed with deploying the OSMO, and governance shouldn’t have to guess how the multisig will proceed.