Proposal: Move v2.1 liquidity to v3

Community Chatroom (DISCUSSION)
42

It is blatant theft trying to force v2 users to v3. IL protection might be stopped, but it also stopped for v2 users as well. V2 users are not asking for IL protection. They are asking to be allowed to withdraw their assets with the IL loss specific to their v2 position because that’s where they CHOSE to stay.

Some people might have benefited a lot but some people also chased for months or years to find positions in v2 pools like myself. I for example waited more than a year to get in v2. I thought v3 allowing everybodty was risky and stood in v2. Why do I have to pay for people who decided to go to v3 which has a completely different design where everybody can stake? I stood in v2 because I understood that the LP stake limit allowed the team to cover the IL without hurting bnt token price too much. But allowing everyone inside is what made it worse, multiplying the size of IL.

I made the right decision with the information I had. And for the record most people who were in v2 was long time users of bancor. You might say they earned a lot but they also made the protocol as it is.

The right thing to do is to allow v2 users to withdraw on the terms they chose to stay in. WITH THE SURPLUS. But at least the second option of allowing them to withdraw with IL according to their position is at least acceptible, although completely unethical and absolute theft.

On a second note,
illegally robbing v2 users funds to relieve v3 positions makes no sense. It will not make v3 users whole by any rate and maybe decrease their losses by few percentages. This will not make v3 users happy by any margin, they will still have lost quite a lot of money trusting bancor. But it will also introduce a lot of v2 users becoming enraged due to being vicitimized. Nobody will say anything better about Bancor.

But if v2 users are honored to the terms they have agreed to AT LEAST in terms of the choice of staying in v2, since IL terms are nulled to anyone, and v2 will also incur IL loss, only smaller compared to v3, at least the protocol will have honored all agreements with the sole exception of IL protection.

But robbing v2 users will mean that Bancor will also null other terms than IL loss. It will mean that not only IL protection is nulled, Bancor will null the very concept of defi, allowing people to choose where to stake their money.

IF WE START SOCIALIZING LOSSES, THAN WHY NOT SOCIALIZE ALL IL LOSS INCLUDING BETWEEN ALL DIFFERENT TYPES OF TOKENS?

The decision to force v2 will open many doors, marking the end of Bancor as we know it. And the race to withdraw will make IL even worse. Nobody will stay.

6 Likes
43

That’s $7M+ of deficit that can be reduced!
A few pools such as WBTC and ETH missing from here, which I take is due to them not being in surplus?

Now should these pools be handled separately from pools which are in surplus? Absolutely not, just move all of them to v3 - avoid any complexity, additional dev efforts, scenarios such as fair to this LP but not that LP who migrated, had different pool, etc.

5 Likes
44

Maybe add a column for TKN amounts? (and then add to a Dune dashboard or use the script editor in Google Sheets to automate)

45

the IL that you receive should be equal to that of what happened in v3.

When whales withdrawing with their ILP were given the newly issued BNT to cover losses, who then immediately sold those bnt back to the TKNs of their choice , do you think that this would have not equally impacted your position?

What bancor is currently going through is a TOTAL BANCOR PROTOCOL problem. It is NOT specific to v2.1 or V3. It is bancors problem as a whole which will effect every user. The problem was not a bug in v3… the solution was not by staying in v2.1 … ILP which stretched across the ENTIRE platform led to the issue we are facing. AND to make things worse, having LPs of bancor being split in half made us that much weaker and prone to these problems.

When the whales converted the ILP bnt back into TKNs, were all the trades only facilitated through V3 ? No !

The solution to this problem is getting delayed and exacerbated by people who share this same opinion as yourself. Your current position will have… and has… gotten hit equally just as hard as everyones in V3.

4 Likes
46

Completely agree here.

Even without there being a surplus from the eth and wbtc pools in v2.1 , I am still assuming that the deficit should somehow improve when funds are ported over to v3. As I mentioned earlier in a previous post, with just a small movement of funds porting over to the v3 wbtc vault, my IL reduced from 65% to 50%.

Porting funds from v2 to v3 should give the fasted and greatest immediate impact to resolving the current issue. I hope that we can gather enough force behind this request to push the developers to prioritize this request

47

No. I KNOW that this would not have equally affected my position in v2 because in v2, there was a LP limit in terms of the token you put in there and there was always a line to get in. So getting out and selling ILP tokens was much more punishing in v2.1 than v3. There was a chance you could not get back in and lose favorable APRs

4 Likes
48

Updated data that includes all pools -

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49

I would like to remind everybody that as of now, the only end user contract Bancor broke is Impermanent Loss Protection.

If v2 funds are forcibly moved over to rob, that means that as of that moment, Bancor has absolute control of your funds instead of yourself. The team is already being very unresponsible in putting this discussion here at all because it’s obvious more than 80-90 % of total users were in v3, obviously they want to illegally move over the v2 value because they were degenerate apes who jumped on v3 without thinking that allowing everyone to stake without a limit would destroy the ILP.

This discussion is no different than openly voting to seize all staked assets and distributing them to governance holders. This is a discussion to illegally seize assets of other people. Either way I want my money back, as it is, with IL loss but at least under the same smart contract I voluntarily initially put it into.

Unfortunately due to the discussions here sanctioned by the team I had to get an attorney, my attorney will soon send a demand letter, asking the team to use the same privileges they did when they disabled IL protection to return my money from the smart contract I consented them to. Anyone else here in v2 who don’t want to get robbed at gunpoint by these v3 gamblers and the team behind their back can dm me and I can get my attorney to send demand letters on their behalves too. In fact if you are a US citizen, that’s much better since much of the team seems to be in US and we can get stuff moving.

5 Likes
50

the argument that you are trying to make has absolutely 0% relevance towards preventing your LP position from the negative consequences of what happened to bancor. 0%.

the limited space of TKNS in v2.1 would not have saved you from what transpired. Celcius, 3AC and other whale friends have been using bancor since v2.1 . Whether you like it or not, we are all in this together.

But if starring at your LP position on v2.1 portfolio page where its displaying outdating information makes you feel better… then … enjoy

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51

The moment you say something like this in retrospect with no way of ever proving really what would have happened, your whole argument is not worth considering.

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52

track the wallet and see if they were in v2.1. easy and simple. Im not here to do this for you, but im trying to better help you understand our current situation

1 Like
53

Thanks for sharing this.

ETH and BTC pools are in more deficit on v2.1 vs v3. And the v2.1 LPs can currently migrate to v3 to reduce their deficit %. This is ‘unfair’ to v3 LPs if we go by the same argument provided by v2.1 LPs about their IL being less. There is clearly no ethical solution which would satisfy everyone. And I still stand by the point that trust is Bancor is only going to be decided by the fee generation and split solutions being discussed, not this proposal.

Anyways, I believe the only way is to move all funds to v3. It is an overall fair scenario for v2.1 and v3 LPs, takes the least effort, removes maintenance efforts from v2.1 and keeps the team focused on just v3 support.

I’ll update the post with recent discussions and move it forward.

5 Likes
54

Totally agree on all points you state here. In my opinion this also should happen in a fast and timely manner. If we implement the limit on trading liquidity in v3 and let v2.1 stall for a longer period of time, it would only increase the risk of collecting more unnecessary IL.
When will this be up for a vote?

55

As this is a highly sensitive topic, I think the community should take more time to assess the different implications and consider all the different options and how they affect different LPs.
I don’t know if there’s a “fair” option at this point though, seems like any option is going to negatively affect some LPs.
Maybe it should also be handled in a per LP basis regardless of technical complexity.

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56

The problem is that v2.1 people are highly privileged, if they are allowed to withdraw from v2.1. They basically have 2 pools then and if their v2.1 pool has a bigger deficit than the v3 one, they simply migrate.

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57

I’m not sure it’s as easy as this.

When looking at the July 20 Surplus Google sheet, it shows a larger deficit for WBTC for v2.1 for example. But when you look at v3 deficit, it’s been going down as v2.1 WBTC whales have been moving over to v3 over the past few days.

Shows how complicated the situation is on a pool basis. All I know is that overall, as more tokens have been transferred from v2.1 → v3, the v3 deficit seems to be going down.

58

The notion that a decision can negatively impact 1 group of people over the other brings into question;

the problem that bancor recently went through - mass exodus, ILP minting BNT, BNT being sold onto the market

** is this a v2.1 or a v3 problem ? or is this a problem for the entire protocol?**
** was the BNT being sold onto the market only being sold on v3 pools? or were the trades also being sourced through v2.1 pools? **
** the portfolio page for v2 still shows users balances as 100% whole and that they still are entitled to ILP to make them whole… is this the case ?? **

If this was further discussed by the big brains of the project during the community call, then this could have given more clarity to all the users… however this has not been covered by the developers… and I cannot understand why

To answer my above questions , the recent events … mass exodus, ILP minting of BNT and selling of BNT is not a v3 problem, but a Bancor problem and this affects all users and all pools regardless of which version. The portfolio page for v2 users should get updated to reflect their specific positions. ILP was not just a guarantee for v2 but also for v3… until it was no longer.

I will continue to state my experience in the wbtc pool, as people migrate from v2 to v3, my IL has continued to reduce from 65% down to now less than 50% …

These positive effects of users migrating to v3 cause an immediate positive response to the wbtc pool, therefor its likely this will do the same for all other pools.

Users are currently divided on this topic, and justly so, because we have not been given clarity from the people in charge. I as well as many others are trying to shed light on this matter, however, this topic once again is not being openly discussed from the public figureheads // people who can actually sway opinions on this matter.

the mass migration is a quick fix, with immediate positive effects, will shed more light and clarity on bancors current situation.

Yudi…Mark… I implore you to dig deeper into this… and prioritize this as the 1st change that the protocol implements.

Who may I ask gets negatively impacted??.. when in fact… this problem was not a version problem… but a core feature of bancor problem which stretched across the different versions. We the users are all affected, however there are half of us who simply think are unaffected which is causing division and strife between community members. During this period of time, it would be beneficial for bancor and its community as a whole to get onto the same page and move forward together. Let’s make this happen and please move a little faster.

The decision makers… or people who have the power to sway public opinion… need to act a little faster… I respectfully would like to remind you that although it is prudent to take our time… this is also a battle against the clock… and if the market resumes its uptrend… and the deficits balloon before we minimize the damage and actually implement changes… this manageable problem can and will grow into something that is significantly harder to come back from. I’m not trying to light a, fire under your ass, but whether you like it or not… the flame has already ignited.

2 Likes
59

The problem is that there’s no “correct” way to do it - this is highly subjective.
I’m not sure the community even agrees on who owns the surplus in v2.1 yet - protocol or LPs?
If the surplus in v2.1 is owned by the protocol, it makes sense that the surplus itself should move to v3 (as a matter of fact, there’s a function that does that already, since it was part of the plan, eventually - but of course things are different when BNT distribution is off).
So maybe the community should evaluate that as first step before making a wider and much more complicated decision.

60

I have done as you mentioned and created a poll. with these results, I am hoping this will help provide clarity and give us the push needed to take action.

61

I also want to comment that it is right to discuss the surplus, but I also want your comment on LPs positions that are still currently in v2.1

  1. were they affected by the current events?

  2. are their positions still whole and are they entitled to ILP?

  3. was the problem at hand a bancor protocol problem or was it specific to only v3?

Don’t mean to target you Yudi, so perhaps you and Mark could shed light on these questions. thank you