-Edit 1, December 6th: clarified that this proposal does not ask for a revenue share agreement with Mars. This prop mirrors the Neutron deal, except it does not 1) ask for an exclusivity clause or 2) ask for revenue share.
The Mars community is considering deprecating its chain and relocating Mars Hub to an existing generalized smart contract chain.
This morning, a forum post on the Neutron governance forum proposed that the Neutron DAO make a strategic investment in Mars protocol in exchange for Mars Hub relocating to Neutron.
But it would make more sense for Mars Hub to relocate to Osmosis.
Also, the Neutron forum proposal would establish an exclusive relationship between Mars and Neutron, whereby there would be restrictions on Mars launching new features on other chains beside Neutron. Also, the Neutron proposal would require Mars to share 10% of its revenues from all outposts with the Neutron DAO. This exclusive relationship is inconsistent with a “grow the pie” approach to interchain development.
Therefore, this proposal aims to offer the exact same deal to Mars that Neutron is offering – with two important difference: 1) this proposal does not require a restriction on deployment of new Mars features, and 2) nor does it require a revenue share agreement with Mars.
Specifically, this proposal aims to grant Mars $3M USDC in installments over a period of two years. In exchange, Mars would grant Osmosis 60M MARS tokens, and would agree to relocate Mars Hub to Osmosis, while retaining Mars’ ability to deploy outposts on any chain.
First - since the relaunch of Mars in February of 2023, Mars and Osmosis have had a very tight relationship. Mars’ first outpost was on Osmosis. In order to help Mars with its go-to-market, Osmosis governance generously provided a grant of 310K OSMO to bootstrap Mars token liquidity. In a follow-up proposal, Osmosis governance approved MARS token for regular OSMO incentives.
Second - Mars has the majority of its TVL and token liquidity on Osmosis. Mars currently has two outposts: on Osmosis and Neutron. But according to DeFi Llama, over 95% of Mars’ TVL is on Osmosis. In addition, while the MARS token is listed on both Osmosis and Neutron - again, over 95% of MARS token liquidity and volume is on Osmosis.
Third - Osmosis has by far the highest IBC traffic and IBC connections, as can be seen on Map of Zones. As Mars is an interchain protocol with outposts on potentially many chains, it makes sense for Mars Hub to be located at the center of the IBC network.
As a leading Cosmos interchain protocol, Mars could be painfully limited by the exclusivity clause in the Neutron proposal. According to the Neutron proposal, Mars would be restricted from deploying new features to non-Neutron chains for three months after deployment on Neutron. This restriction would presumably be effective in perpetuity.
In the future, Mars could potentially have outposts on Osmosis, Neutron, Sei, Terra, Injective - and perhaps chains that haven’t even launched yet! With potentially such a large network of outposts, this exclusivity restriction from the Neutron proposal could hamper Mars’ growth.
Exclusive deals are not the way to grow the pie! As such, this proposal for Mars Hub to relocate to Osmosis does not have any exclusivity clauses. Mars governance would be free to deploy new features wherever it wanted whenever it wanted.
This proposal would mirror all the details of the Neutron proposal.
Specifically, Mars would receive $3M USDC from the Osmosis community pool, vested according to milestones. This USDC would be sourced from the USDC in the community pool, the sale of non-OSMO tokens in the community pool, or the sale of OSMO. Potentially, the Osmosis community pool may wish to arrange an OTC deal to raise a USDC treasury, similar to the Stride incentive diversification action earlier this year.
And for its part, Mars governance would grant 60M MARS to the Osmosis community pool. Osmosis governance would only use this MARS token in ways that are friendly to Mars. And Mars Hub would be relocated to Osmosis.
This proposal asks Osmosis governance if it would approve such a deal with Mars. In order for the deal to take effect, Mars governance would have to ratify it.
Given the long and close history between Mars and Osmosis, it makes sense for Mars Hub to relocate to Osmosis. Also, Mars’ TVL and token liquidity are heavily concentrated on Osmosis. And Osmosis is currently the main IBC hub, with the most traffic and connections - an ideal place for the headquarters of an interchain protocol!
For further details around this proposal, see the Neutron proposal - which this one mirrors. Also, feel free to ask any question you may have.
Pending community discussion, this proposal will go onchain as a signaling proposal soon.