[SIPS-138] Upcoming Real Yield ETH (Optimism deployment) Liquidity Mining Incentives Proposal
This forum post is to discuss the upcoming Governance proposal for liquidity incentives on the Real Yield ETH Cellar (Optimism deployment), which will go up for vote on Friday, March 21, 2024.
Description
This proposal is intended to authorize a one-time transfer of 150,000 SOMM from the community pool to the CellarStaking contract, which will be used to incentivize cellar depositors on Optimism. This program will distribute the authorized amount of tokens over a period of 30 days, starting at the date this proposal passes and is enacted. The total amount of tokens for the proposed program represents 0.128% of the tokens in the community pool.
These funds will be used to incentivize participation in the Real Yield ETH (Optimism deployment) Cellar. It is our goal to establish Sommelier’s presence in the Optimism ecosystem with this vault, and accordingly, are requesting a larger program. Any future incentive program is outside the scope of this governance action and will require a new proposal.
The tokens prescribed by the program will be distributed pro rata to users on Optimism who elect to bond RYETH in Sommelier’s staking contract. The CellarStaking smart contract (cellar-staking/CellarStaking.sol at main · PeggyJV/cellar-staking · GitHub) governs the bonding of RYETH and the distribution of the tokens reserved for SOMM rewards. Pro rata allocation is determined based on share of the pool, where that share is equal to the amount of the user’s RYETH tokens deposited, multiplied by a “boost” determined by the amount of time those cellar shares are locked for. Shares receive a 10% boost by locking for 7 days, a 30% boost for locking for 14 days, and a 50% boost for locking for 21 days.
A to-be-created smart contract [TBD], is based on canonical staking conventions used across the Ethereum Virtual Machine, principally the Synthetix staking rewards contract, originally developed in 2018. Variations of this code have secured billions of dollars of rewards across various EVM-compatible blockchains. The CellarStaking smart contract has been audited by Macro, with the audit available here: cellar-contracts/Macro_Cellar_CellarStaking_07_2022.pdf at main · PeggyJV/cellar-contracts · GitHub.
A multisig on Sommelier, composed of a mix of early developers on the Sommelier Chain as well as contributors to the Sommelier ecosystem, has administrative powers to bridge the SOMM via Axelar to the Optimism staking contract while Axelar distributions of Community Spend proposals to L2s is being completed.
The multi-sig address on Sommelier for the bridge transfer somm1n96wzq4yyqakcy3fu0wpan9hpy8m8ttgk5njky and is composed of the following:
Kristi Poldsam
Joseph Terrigno
Zaki Manian
A separate to-be-created multisig on Optimism has administrative powers over the staking contract and is able to perform the following actions:
Schedule a certain amount of tokens owned by the contract for distribution (via notifyRewardAmount)
Set the duration of future rewards programs (via setRewardsDuration)
Set the minimum deposit in RYETH tokens in order to participate in the rewards program (via setMinimumDeposit)
Pause and unpause bonding operations in emergency scenarios (via setPaused)
Trigger a one-time emergency shutdown on the contract, which stops new reward accumulation and allows all depositors to withdraw their assets immediately, disregarding unbonding times (via emergencyStop).
The multisig is currently composed of a mix of early developers on the Sommelier Chain and protocol, Ethereum smart contract developers, and cellar strategists:
Zaki Manian
Kristi Polsdam
Joseph Terrigno
Stephanie Vaughan
Sunand Raghupathi
Crispy Mangoes
Josh Kessler
This proposal, if accepted, will spend 150,000 SOMM from the community pool in order to fund the CellarStaking contract according to the parameters of this proposal. The multisig shall be responsible for enacting the program according to the parameters of this proposal once the requisite SOMM tokens are funded by the validators.
Reference Links:
CellarStaking Contract: cellar-staking/CellarStaking.sol at main · PeggyJV/cellar-staking · GitHub
CellarStaking deployment:
[To-be-created]
Optimism multisig: Safe{Wallet}
Macro Audit: cellar-contracts/Macro_Cellar_CellarStaking_07_2022.pdf at main · PeggyJV/cellar-contracts · GitHub
Synthetix Staking Rewards Contract: synthetix/StakingRewards.sol at v2.63.1-alpha · Synthetixio/synthetix · GitHub