The Automaton will wait for the Sator Twitter account to acknowledge the proposal before voting FOR.
No Tweet from ENS - the Automaton will vote AGAINST, although it is not going to affect the outcome.
The Voting Automaton’s default vote for LM extensions is AGAINST, for all but a handful of select tokens.
if PriorLM == False and StrategicPool == True: FOR Elif PriorLM == True and TKN == 'LINK', 'WBTC', 'ETH', 'USDC', 'DAI', 'USDT': FOR Else: AGAINST
The mandatory tweet has been confirmed. The 100k co-investment is reasonable, given the liquidity that exists elsewhere. The token distribution is quite good; its has an interesting chain-specific supply model, which I suppose is to obfuscate complicated supply management. Whatever the reason, it’s not worrying. The litepaper is a little vague (par for the course, unfortunately), but essentially represents Sheesha Finance as a tokenized mutual fund. The team is Doxxed (positive), and its advisory board consists of both DeFi- and CeFi-leaning entities. The SHEESHA token is vanilla erc20. The Voting Automaton will vote FOR whitelisting SHEESHA finance.
The Voting Automaton will vote FOR increasing the ARCONA pool capacity.
$FXS is the non-stable (volatile) governance token associated with Frax Finance; not to be confused with its algorithmic stablecoin, $FRAX. At this stage the Frax Finance project is quite well-established, with numerous sources of liquidity both on centralized exchanges and other DeFi protocols. The proposed co-investment is relatively modest, compared with the relative size of the liquidity elsewhere - which is fine. Having smaller pools is easier to tolerate in terms of risk than larger pools. The token is a vanilla erc20, straight out of the OpenZeppelin library, and does not represent any apparent security threats. The token distribution leaves a little to be desired; the top 2 wallets currently hold 68% of the token supply. This is not necessarily a blocker, and becomes more forgivable in light of the relatively low co-investment. The official Frax Finance Twitter account has not yet acknowledged the proposal. The Automaton will vote FOR whitelisting status of FXS as soon as this tweet is broadcast.
DUSK is a zero-knowledge proofs project focused on developing confidential smart contracts and security tokens. It is its own blockchain, although without a functioning product at present. The testnet is due for launch in February 2022. While projects-in-development can be risky token offerings, the DUSK token has some redeeming properties already, that make whitelisting considerations slightly more lenient. The distribution of the token is quite good, and is present on both BSC and Ethereum, where it has established existing liquidity pools with decent volume/liquidity. DUSK is a supply-capped token, and a standard erc20 from the OpenZeppelin library. In general, layer1 tokens have a tendency to skyrocket in value, which presents a considerable IL risk. However, the asking co-investment is relatively small, and the token’s volatility is extreme - which is positive from a fee-earning perspective. DUSK is available on the major CEX exchanges, which certainly lends confidence. The Dusk Twitter account has acknowledged the proposal, which has already caught the attention of its community. Reception seems positive. More importantly, the DUSK team has agreed to bootstrap the pool with $50,000 of DUSK tokens. The Automaton will vote FOR whitelisting DUSK, and asks that the DAO consider a higher-than-average swap fee (e.g. 0.5%) early in the lifecycle of this pool.
The Automaton will vote FOR both of these updates to the DAO’s use of Snapshot, and its new features. The Abstain feature has been in discussion since the formation of the DAO in October of 2020, and its availability is an awesome relief.
Thank you Mark, always appreciate the Votingautomaton’s take on the proposals!
At this time, the Boba Network main Twitter account has yet to acknowledge the proposal via its main Twitter account. The Automaton will vote AGAINST until this condition is met.
Boba Network is another optimistic roll-up scaling solution for Ethereum and is linked to the OMG foundation via the Enya team. The Boba Network will continue to use ETH as the gas token, which is interesting. It is not entirely clear what the role of the $BOBA token is; the Boba Network website says that ti will have governance properties, and be used primarily for staking rewards, liquidity incentives and grants and funding. The exit process for Boba Network relies on community liquidity pools, allegedly allowing for a same-day transition from L2 back to L1. This arrangement is unusual, and it remains to be seen how the system will behave over longer time periods, and where the security vulnerabilities may be.
As the author points out, the $BOBA token poses a notable IL risk, as young chains have a tendency to garner significant interest during their debut period. The Boba Network ecosystem is small, but growing. A handful of dApps are available, including a few different DEXes, DeBank, and some NFT projects. If its popularity grows, the $BOBA token price could move as $MATIC or $AVAX did. Fortunately the token is already well-established, although there are some important details to note here. The $BOBA token was not tradable as recently as November 13th. The token distribution includes both an airdrop to OMG wallets, a community treasury, strategic investors and the team wallets. Nothing here is out of the ordinary - token unlocks commence after 12 months and continue unlock over 4 years, which is pretty standard.
All together it is a strange case for a chain token, as it is not used for gas. Instead it is an incentives/governance token of the most familiar variety. On one hand, new chain tokens have a propensity to moon hard, but $BOBA is unlike other chain tokens in the sense that it is not required by the chain, and so may be more even-tempered. The token distribution seems fine, and the project is most certainly serving a useful purpose and is backed by an excellent team with a clearly defined mission statement. The $BOBA token itself looks harmless from a contract perspective, although a handful of imposters are circulating. With the small trading liquidity contribution from the protocol (50k is reasonable), the proposal is positive on balance. The Automaton will vote FOR whitelisting of $BOBA only after the proposal is acknowledged on the team’s Twitter account.
The Automaton will vote FOR increasing the trading liquidity on PSP. The token is still new, but has had time to settle since the airdrop. The increase is concomitant with a liquidity contribution from the PSP treasury; historically these collaborations have been very positive.
Since the first attempt, the $SAO token whitelisting proposal has been markedly improved. The initial confusion surrounding the token supply has been largely addressed; the token is native to Solana, and is bridged to Ethereum via the Sator (Wormhole).
The token supply on Ethereum is moderately concerning. The second highest wallet balance (2,150,000 SAO) is roughly 20% of all tokens on Ethereum. This address is the sole liquidity provider on Uniswapv2 for the $SAO token.
This is not ideal; however, the total dollar value is relatively benign - about $82,000 on Uniswap (WETH + SAO), and another $222,000 remaining in the wallet in SAO + about $4,000 in ETH. Common sense suggests this could be a team wallet, charged with a little ETH to pay for gas, and some SAO to establish liquidity on Ethereum. While the liquidity is currently highly centralized, the total amount is not sufficient to raise alarm.
The top wallet on Solana commands 79% of the token supply. This is very high, even for a team wallet. However, seeing as this is the mint address, it likely includes allocation for things like community incentives, staking incentives, and exchange liquidity. It’s not easy to find information on the subject, but an ido document is available that sheds some light on the planned distribution, although not much. The author included the following text in the proposal:
The Sator project is high quality, with apps available via the Google Play store and the Apple app store. The ambition seems to be to commoditize audiences via SAO incentives and NFTs; in essence, becoming a pay-for-influence, or pay-for-views/clicks platform for content creators to bootstrap their media presence, and/or online following. It is an interesting use case, and whatever your personal feelings are about it, probably does serve a legitimate pain point.
In summary, the token ought to be whitelistable, but the centralized liquidity, and centralization of the token in general, is a big problem. The proposed trading liquidity is relatively low, and so long as it stays that way, is unlikely to be a threat to the Bancor system. Moreover, the proposal itself explicitly addresses the token supply and the ambitions to achieve distribution among users.
The automaton will vote FOR $SAO whitelist status after the main SATOR Twitter account acknowledges the proposal, and recommends the pool not be allowed to grow any deeper until the token supply has established a healthy equilibrium between Solana and Ethereum, and has found its way into the hands of more users.
The Automaton was created to vote consistently and predictably, so that vote delegators have a reasonable chance of guessing which way the Automaton will vote, without having to refer to this page every week. The current rules are:
if pool = ETH and 0.05% < proposedFee < 0.15%: vote = FOR elif pool != ETH and 0.1% < proposedFee < 1.0%: vote = FOR else: vote = AGAINST
To maintain consistency, the Automaton will continue to observe these rules. However, if the DAO passes the vote for the proposed $TRAC fee changes, I will consider that to be ample evidence that a change in the Automaton’s behavior for fee changes is warranted.
Therefore, the Automaton is voting AGAINST the proposed fee schedule, as it ventures outside of previously established bounds. If the DAO passes this decision, this voting logic will be revised.
The Voting Automaton will vote FOR disabling deposits on RSR.
Following the success of the TRAC fees proposal, the Automaton will now take a more liberal approach to fees governance. Rather than have a concrete voting strategy, it seems sensible to wait for the results of the current fees experiments to conclude before arriving at a new set of guidelines. Therefore, at least for now, the Automaton will vote FOR all changes to fees. Moreover, I will pursue a dedicated channel to discuss results.
The Automaton will vote for the proposed fee change to LPL.
The wNXM pool is among the most consistent revenue generators on Bancor. The Automaton will vote FOR the proposed increase in trading liquidity, and single-sided capacity.
As above, the Automaton will vote FOR the proposed fee change on CEL, and will support all proposed fee changes until clarity with regards to fees/volume ratios are established.
The Tweet from the main BBS account has been confirmed. The BBS Twitter account has been proactive leading up to the proposal (see: here, here, here, here, here). BBS is a social content system, similar to Reddit, where potential ad revenue generated from community content is bid on by BBS token holders. The model is designed to create a fair revenue model where the value of the content is realized through the purchase of the ad space it represents. This model is very much aligned with the web3 values and decentralization, and is an interesting use case for cryptocurrency.
The BBS token is relatively new, and not well established yet. Usually this would make it very difficult to whitelist; however, the BBS team has committed to using the Bancor3 external IL protection mechanism with the Bancor3 launch. It may have been better to wait for the external IL function to be available; however, this may be a moot point. The team is providing the BBS tokens themselves, and migration from v2.1 to v3 does not result in IL compensation, should any have accrued. So while it is not the ideal solution, BBS is ready now and wants to use Bancor as its default exchange. So long as we are not expecting the team to withdraw before the Bancor3 launch, and the external IL protection agreement is honored, it really doesn’t make much difference.
The asking trading liquidity is 100K BNT - which is a lot for a new token project. That said, it is not surprising to ask for the “largest small coinvestment”, as the author of the proposal has clearly indicated that they are a mass-market facing product.
The token is a standard erc20, with no apparent security problems. In sum, the proposal feels early, but ultimately the balance is positive. The BBS website, and the BBS market seem to be experiencing some impressive growth. The “Crypo Banter” channel has nearly 20,000 users, and represents a potential accessible demographic for Bancor if we become the default liquidity source for BBS.
The Automaton will vote FOR the whitelisting status of BBS.
The Tweet from the main DerivaDAO Twitter handle has been confirmed.
The DDX token is very standard, and its distribution is better than most. Approximately half of the DDX token supply will be used in liquidity incentives. However, there is an enormous allocation (15%) to an unnamed “investor”. This is likely from the early funding round and quickly becoming an inescapable reality for many token projects. This is at least partly offset by the decade-long liquidity incentives campaign established for DDX. The single investor DDX whale aside, everything else is better than average.
The DerivaDAO manages the DerivaDEX, a derivatives exchange protocol on Ethereum. The function of DDX holders is similar to that of vBNT holders - they shoulder the responsibility of managing the exchange, and its unique insurance fund, among other things. Value accrual to the token is achieved via fees and liquidations. Not a novel use case by any measure, but a compelling one nonetheless.
The requested trading liquidity is 100,000 BNT. This is relatively high, considering the low levels of liquidity elsewhere in DeFi. That said, there is nothing especially frightening about DDX. The token supply is going to inflate, but over long periods of time compared to the status quo for DeFi. Its volumes are similarly low - near zero, for the most part.
In short, DDX is not a home-run for Bancor by any measure, but it is attached to a community that understands the challenge of running a decentralized exchange. The requested trading liquidity is high for DDX, but negligible to the protocol overall. The proposal was also raised by its author on the DerivaDAO governance forum; however it did not garner much attention there.
Altogether, the 100K coinvestment is probably a little on the high side, given the volumes and competing liquidity for DDX elsewhere. The Automaton will support its whitelisting, but is unlikely to support any increase in the single-sided capacity until the market warms up to the token.
The Automaton will vote FOR whitelisting of DDX.
Very interested in seeing this one pan out.
VitaDAO is attempting to address the lack of early-stage research funding in novel biopharmaceuticals. It is among a very small collection of cryptocurrency projects that have a focus on something other than the axiomatic financial primitives. The VITA token is earned by contributing to ongoing work, submitting new intellectual property, or funding the research directly. It is a super-interesting use case, and is targeting one of the highest revenue-generating industries in existence. More importantly, the pain-point they have identified is legitimate; discovery-phase funding has been in decline for decades, and as a result, new drug developments have practically stalled. This is one of the potentially civilization-disrupting obstacles the global community is facing in the near future, and is of a similar scale to the effects of climate change. That doesn’t necessarily guarantee the project will be a success - but its motivation is sound.
The VITA token is fixed-supply, standard ERC-20, with no administrator permissions. The token is reasonably well-distributed, with one caveat. One address received 15% of the VitaDAO token supply in an apparent auction in June of 2020. The recipient had 3.3M VitaDAO tokens at that time (then worth approx. $11M), and still has most of it, despite trading the token regularly. I have reached out to the team to ask about it - an active whale with 15% of the token supply is potentially problematic. Not a blocker, necessarily, but worth inquiring about.
Apart from this one curiosity, the project looks green across the board. The customary Tweet from the VitaDAO main Twitter handle has been confirmed. The Voting Automaton will vote FOR whitelisting, after clarification on the token auction is obtained. I suspect this is part of the funding mechanism of the project, and is unlikely to be much cause for concern.
Proposal to increase the trading liquidity limit in the ENS-BNT pool to 200K BNT
Proposal to increase the trading liquidity limit in the PSP-BNT pool to 300K BNT
Proposal: Increase Trading Liquidity Limit to 250K BNT on the IDLE-BNT Pool
Both the ENS and PSP pools were created only shortly after these tokens first appeared. Their popularity and strength has been maintained, and the market is certainly coming to settle into “normal” volatility by crypto standards. It is an opportune time to increase the trading liquidity on both tokens. The Voting Automaton will vote FOR the proposed increase in both cases.
The IDLE pool is is also an excellent candidate. The IDLE team have tweeted about the benefits of single-sided staking, and the opportunity to provide protected liquidity on Bancor should this proposal pass. The Automaton will vote FOR the proposed increase in funding.
Proposal: Change the fee in the BAT pool from 0.2% to 0.5%
Proposal: Change the fee in the AMP pool from 0.5% to 1%
Proposal: Change the fee in the PSP pool from 0.2% to 0.5%
Proposal: Change the fee in the LINK pool from 0.2% to 0.5%
Proposal: Stablecoin pools fee experiment and analysis
As per the new paradigm, the Voting Automaton is voting for all proposed fee changes, until sufficient data is available to inform a new policy. Therefore, the Automaton is voting FOR all five of these proposals.
The Automaton is pro-community governance, and will support any and all proposals that are thematically aligned with increased engagement, without sacrificing integrity or security. The POAP introduction is low-overhead, inclusive, and does not interfere with the evaluation of proposals’ on their own merits. Therefore, there are no identifiable issues to allowing it.
The HAL plugin is similarly easy to approve. This will allow for automated notifications to be built in to the Snapshot process, and ought to help support our ambitions for a more involved community government.
The Automaton will vote FOR both proposals.
DAO Maker is an excellent project. Its focus is on the “start-up” phase of tokenized projects, which has been a stubborn issue since the ICO era. The project aims to further decentralize the venture capital and reduce the financial risk for both investors and the token project. It is a healthy influence in crypto, and the industry is better for the service it provides.
Importantly, there is room for further collaboration between DAO Maker and Bancor in the future, as fledgling token projects progress out of their incubator phase and start to establish liquidity alongside their peers. Think of Maker DAO as the “training wheels” of establishing a token, where the first holders get access to it, and distribution can begin in a healthy, quasi-limited fashion. Then, when it is ready, Bancor could become the next stage of its market development. You don’t have to squint very hard to see how this could become a natural graduation into whitelist status, especially with the additional features (such as external IL protection) offered by Bancor3.
The customary Tweet from the team has been confirmed from their main Twitter handle. therefore, the automaton will vote FOR the whitelist status of DAO Maker.
As a follow-up to the transaction highlighted on the previous post, the participant looks to have paid 1347 ETH for a minimum of 1,531,702 VitaDAO tokens, and received 3,367,500 at the auction conclusion. There was no price for the VitaDAO token prior to this auction, and the valuation dropped 60% shortly after establishing an initial price. This looks like a typical presale. Thanks to @DarkKnight for illuminating these details.
The team has confirmed that the wallet belongs to a highly motivated supporter of the project. It’s not a big issue - the token has established liquidity on Balancer, both as a 50/50 pool and an 80/20 pool, and also on Uniswap V3. Even if this user had nefarious intent, the damage they could inflict is massively tempered against the available liquidity. The 80/20 pool on Balancer has $1.7M in liquidity, but due to the skew in the curve, can absorb a disproportionate quantity of selling pressure on the VitaDAO side. Price manipulation tactics are still a risk with such a whale present, but their on-chain activity does not reflect any such desire. If anything, they are guilty only over being highly enthusiastic. Fingers crossed they are interested in providing liquidity on Bancor.
The Automaton will vote FOR the whitelisting of VitaDAO.
The automaton will vote FOR the discontinuation of $RGT deposits permanently, and $TRIBE deposits temporarily, pending the completion of the token merger.
The Automaton LM logic has not changed:
if PriorLM == False and StrategicPool == True: FOR Elif PriorLM == True and TKN == 'LINK', 'WBTC', 'ETH', 'USDC', 'DAI', 'USDT': FOR Else: AGAINST
Therefore, the Automaton will vote FOR the proposed extension on stables.
This is a simple migration. The Rocket Pool team is in contact with the Bancor core contributors, and will help to inform the LPs of how to migrate to the new token contract. This is a non-issue; there is no rush to migrate, and it exposes no security threats to the Bancor ecosystem. The Automaton will vote FOR whitelisting the new RPL token.