COSMOS NEWS: NAMADA SHIELDED EXPEDITION & RPGF DROP, DYDX V4, ATOM, OSMO & MORE!!

Hi Cosmonauts! ⚛️
Welcome to the Cosmos ecosystem news roundup, here are the top stories in Cosmos in the 1st half of December:

NAMADA SHIELDED EXPEDITION AND RPGF DROP: Namada’s incentivized testnet before the mainnet, how to participate and what are the different phases? 30 million NAM to win as rewards for delegators and validators. RPGF Drop with a total of 65 million NAM, how to claim your NAM? What are the eligible categories? Everything you need to know is in this episode. The first Namada Community Builder RPGF round with 10 million NAM allocated, what is it? Who participated and what are the next steps? What is Namada’s mission and vision, cubic Proof of Stake or epoch staking? Become a Namada expert by watching this episode

DYDX V4 REACHES OVER $3 BILLION TRADING VOLUME: Major milestones achieved just weeks after full trading was enabled. Which further incentives will drive more volume to migrate from v3 to v4? Which are the most honest dYdX Chain validators according to the MEV dashboard? Which validators doubled signed recently and how you should choose validators on the dYdX Chain? All this and much more in this episode

ICF FUNDING 2024: The ICF announced the total funding allocation for 2024, how much is it and which projects and teams will receive the funding?

Focused sections about Osmosis, Secret Network, Persistence, Juno, Stride and Crypto regulations and compliance updates with MME

All this and much more in this episode, and now for today’s top stories:

Tech

Namada announced the RPGF Drop which was inspired by the Celestia airdrop. Along with dYdX v4 and Celestia, Namada is the other major mainnet launch highly anticipated in Cosmos and also in the broader crypto ecosystem. Christopher Goes, a co-founder of Namada, previously led the development of IBC, which has now become the blockchain industry standard for interoperability. This Namada RPGF drop is time sensitive, because the claiming will close on the 28th of December 2023, at 9:00am UTC. Therefore make sure to claim your NAM tokens if you are eligible before the 28th December, below you will find the official link to claim the airdrop.
A total of 65 million NAM is allocated for this RPGF Drop, and this represents 6.5% of the total NAM supply of 1 billion NAM. This total supply of 1 billion tokens is the same as in the case of Celestia, which also has a 1 billion total token supply.
It is also important to note that the minimum amount indicated for each category of the RPGF Drop is assuming that 100% of eligible participants claim their NAM tokens. However, it is likely that some percentage will not claim their NAM and therefore the amount received by those claiming will be higher than the minimum amount.
A large amount of the allocated tokens, 27.5 million NAM, will be for github public contributions in the areas of Zcash research, Rust developer ecosystem, privacy research, ZKPs, users of Ethresearch, Interchain public goods, Shielded ecosystem and more. Therefore, similarly as Celestia, Namada is highly rewarding public contributions developers. Another major part of the RPGF Drop allocation, 20 million NAM, will be for ATOM and OSMO stakers, and owners of BadKids NFTs. Another 17 million NAM will be for Gitcoin Donors of ZK Technology and Crypto Advocacy. Finally, for the 2510 participants in the Namada Trusted Setup Ceremony, which was from November to December 2022, the allocation is 500k NAM. In total, there are 7094 eligible researchers and developers, over 191k eligible on-chain accounts and the over 2.5k contributors in the Namada Trusted Setup.
It is important to clarify that the Namada RPGF Drop is different from the RPGF Nominations and the Namada’s First Community Builder RPGF Round.
The RPGF Nominations happened from December 2022 until March 2023. Although there aren’t updates yet about the RPGF Nominations’ NAM allocation, Namada asked the community to stay tuned for further updates about this.
Also, the first Community Builder (CB) RPGF round is different from the RPGF Drop. For the first CB RPGF round, Namada allocated a total of 10 million NAM. The goal of this CB RPGF round was to reward early community builders contributing to the protocol’s vision and mission, and also to reward validators who have been supporting and participating in testnets. Over 7000 applications were received for the first Namada CB RPGF round, and from these 7000 applications a total of 250 were selected based on their skills, past contributions and community involvement. From these 250 selected, some were removed due to inactivity or other reasons and the final group was 172 in total. To allocate the 10M NAM tokens, a voting was done using Coordinape. A total of 40% of the vote weight was given to the community builders themselves to review and vote for the contributions of the other community builders. Then, the other 60% of the voting weight was for the Namada early PGF stewards. Since a total of 80k votes were given and there were 10 million NAM to allocate, this means that for example 200 votes would represent around 25k NAM. Around 60 community builders will be selected and announced soon to continue on the program.
The Namada mainnet launch is now around the corner. Namada aims to provide privacy as a service that you can use with your existing assets. This is a significant improvement compared to Zcash since you couldn’t choose to use Zcash’s privacy with your asset of choice, but Namada will enable this. Namada wants to help bring privacy as a default, and a first step to achieve this is providing more privacy since most blockchains currently are public and most crypto assets are not shielded. In summary, Zcash showed and brought privacy to one blockchain, Namada is aiming to bring privacy to the whole crypto ecosystem and users.
Beyond privacy as a service, Namada is bringing some other major innovations.
Firstly, Namada will be based on cubic proof of stake, and thanks to this innovative design, the more validators that deviate from the protocol at the same time, the larger the stake slashed, so that correlated attacks are more severely slashed and this enhances the security of Namada.
Moreover, in Namada, your staking rewards will compound automatically thanks to an upgraded variant of the F1 fee distribution module. Another innovative concept that Namada will introduce is epoch staking, with an epoch duration being approximately 1 day. Epoch staking means that PoS state changes are applied only at epoch boundaries, and this makes light clients more efficient and also makes it possible for a DKG protocol to run properly for encrypting transactions in the mempool for optimized privacy. Cubic proof of stake, epoch staking and native auto-compounding are significant improvements compared to existing PoS blockchains.
Namada is solving the segregation of privacy sets by creating a single unified asset-agnostic shielded pool for any fungible or non-fungible token. This unified shielded set is enabled by the MASP, which is an upgraded version of Zcash’s Sapling circuit. It is important also to highlight that the shielded set in Namada is a non-exclusive and anti-rivalrous public good meaning that the more people use shielded transfers, the better the privacy guarantees for each individual.
In addition to this, Namada removes the fragmentation by platforms by decoupling the assets from the platforms and allowing these assets to move to a unified privacy set. To move assets to the unified shielded set users can either use IBC or Namada’s native trustless Ethereum bridge designed to maximise safety, and which is superior to other bridges such as Axelar which require users to accept additional security assumptions and some latency.
Namada will also offer Shielded Data Availability for Celestia, allowing users to leverage the consensus and data availability provided by Celestia, while also maintaining the privacy guarantees offered by Namada. In summary, Namada will provide privacy as a service for all crypto users, for their fungible and non-fungible assets, including for interacting with platforms such as Celestia. Thanks to Namada, users can directly interact with other chains and their respective dApps privately with shielded actions, for example with Shielded private swaps on Osmosis.
Other uses of Namada are seeding new accounts on Ethereum to interact with the diverse dApps and pay for fees and gas. Also, Namada can seed privacy to users wishing to use an asset from one chain on another chain without losing privacy. Furthermore, Namada retrofits privacy to assets which were already created, allowing for example to use your existing ATOM privately.
The Shielded Expedition incentivized testnet was announced with a genesis time set to 16h UTC on the 16th January 2024. This incentivized testnet is expected to last around 2 or 3 weeks, or potentially longer, meaning that the Namada mainnet could happen soon after around February or March 2024. For this incentivized testnet, the Anoma Foundation will allocate 30 million NAM, or 3% of the total token supply. Both validators called Pilots, and delegators called Crew members can apply to participate before the deadline at 9am UTC on the 2nd January 2024, you can follow the link below if you would like to apply. All Crew members submitting valid applications will be selected, but regarding validators only 100 will be selected and eligible for prizes. The selection will be done by members of the Anoma Foundation, Heliax and Knowable.
There will be a list of tasks, called asteroids, before genesis, and there will also be more details before genesis about the ROID points system. During the incentivized testnet there will be a public real-time leaderboard called Nebb, and the ranking will be based on the total amount of ROID accumulated by Pilots and Crew Members. The testnet tokens of this incentivized testnet are called NAAN. Make sure to get ready and submit your application before the 2nd January 2024!

DeFi/Staking

Since the launch of Circle’s CCTP on Noble and the full trading launch on dYdX v4 the 28th November, there has been a great growth of trading volume on dYdX v4. The amount of native USDC issued on Noble doubled in a few weeks and now it is over $50 million USDC and increasing quickly. Moreover, Noble USDC is now available on Coinbase. This growth of USDC on Noble is mainly driven by dYdX v4. The cumulative trading volume on v4 is over $3 billion in just a few weeks, with over $500k in trading fee revenue distributed as staking rewards for dYdX Chain stakers and validators. In December and January there will be further trading rewards reductions in dYdX v3 and rewards increases in v4, to further incentivize the trading volume migration from v3 to v4.
The stake decentralization in the dYdX Chain is of critical importance, and hence the dYdX Foundation announced their selection criteria for a delegation program with the goal to increase decentralization by supporting validators adding value to dYdX and with great performance.
The dYdX Foundation clarified that they will not run any validator and will only stake to validators that are independent from the dYdX Foundation. The delegations will be made pro-rata according to the amount already staked with the independent validators at the time of the delegations. The dYdX Foundation will also self-impose a limit of 10% of the total staked amount on the dYdX Chain, meaning that they will stake an amount lower than 10% of the total DYDX staked. As more DYDX is staked, then the dYdX Foundation will be able to stake more. The validators receiving delegation from the foundation will inherit the governance voting power, since the dYdX Foundation will not participate in governance voting. To select validators to delegate, the dYdX Foundation will consider, amongst other metrics, uptime, governance participation, MEV behaviour and more. Reevaluations of the delegations will occur at least quarterly.
Skip protocol developed a dashboard showing the MEV of each validator and we included the link to this dYdX v4 MEV dashboard below. We are proud that Cosmic Validator is amongst the most honest dYdX validators with one of the lowest average orderbook discrepancy for the last 30 days. Preventing MEV is critical for dYdX v4, and to enhance this MEV dashboard, a governance proposal was approved for a social committee to evaluate MEV behaviour and suggest slashing the validators performing malicious MEV activities.
It is important to mention that if you are a DYDX staker you should perform due diligence to select validators to stake. Previously, FlashCat validator double signed and was tombstoned permanently. Although there is no double sign slashing on dYdX v4, double signing is very serious, and in other PoS chains such as the Cosmos Hub the penalty is 5% slash for double signing. FlashCat created a new validator called ByteBee, since their previous validator is now permanently jailed. Another validator, Tané, also double signed recently and similarly to FlashCat they had to create a new validator since the other validator is permanently jailed. Even currently there is no slashing for double signing, this might change in the future. In addition, while a validator is jailed and until you notice and redelegate you could lose significant staking rewards. Before choosing validators to stake DYDX, you should pay attention whether some validators double signed previously on dYdX v4 or other blockchains. And also whether some validators are unknown and new, or whether they are established validators securing PoS chains for many years and selected for example by Stride or the Interchain Foundation. Furthermore, validators on the dYdX Chain have an overall aggregated score consisting of their uptime, governance participation, number of unique delegators and commission. We are proud to be consistently in the top 10 dYdX Chain validators by total overall score, here you can see the top 10 dYdX validators by total overall score.
Regarding the dYdX Chain rewards, remember that there are three types of rewards. Firstly, the staking rewards received as DYDX and USDC, these rewards accrue every block and need to be claimed manually. Secondly, the trading rewards in DYDX which also accrue every block and are automatically distributed. Finally, the 6 month launch incentive program rewards, these rewards also accrue every block and will be retroactively distributed.
The 4th governance proposal on the dYdX Chain is to seed the insurance fund with around $1 million in exchange of DYDX. Overall, really great growth and developments for the dYdX Chain just a few weeks after the full trading launch. Remember that in December and January there will be further trading incentives reductions on v3 while rewards will be increased on v4, to further accelerate the migration of trading volume from v3 to v4.

Project launches & network upgrades

The Cosmos hub v14 upgrade was successfully implemented on the 13th December. This is an important upgrade affecting consumer chains. Before this upgrade, if there was a double sign event on a consumer chain, a governance proposal had to be submitted to the Cosmos hub to slash the validators that double signed. After the v14 upgrade, the slashing for double signing on consumer chains will be like in the Cosmos hub, meaning automatic slashing for double signing without any governance proposal. Double signing on a consumer chain is serious because tombstoning doesn’t happen only in that consumer chain, but in all other consumer chains and the Cosmos hub as well. To minimize this double signing risk, remember to always use a new key for new consumer chains joining the Cosmos hub and never reuse these keys anywhere else.

Governance

Previously, the proposal 835 in the Cosmos hub was approved to transfer the unclaimed NTRN from the airdrop to the Cosmos hub community pool. Recently, the proposal 24 on Neutron was also approved to execute this transfer of NTRN to the Cosmos hub community pool. A total of almost 43 million NTRN tokens were transferred. The community is now discussing what to do with these NTRN tokens. Jehan, Noam and others have suggested using part of these NTRN as revenue for validators running consumer chains and mentioned that an on-chain proposal will be submitted soon. Regarding the details, some have suggested to exclude for example the top 50 validators since they have enough revenue to cover the consumer chains’ costs and also the validators that are choosing to soft opt-out. The exact amount of the flat fee to be distributed to validators is still being discussed and whether this will be only for the costs of Neutron or also for other consumer chains. Another idea being discussed is using part of these NTRN tokens to acquire USDC and then use the USDC as revenue for validators during the next bear market. A proposal was also shared suggesting 10k NTRN tokens for each validator in the active set running Neutron, and these NTRN will be vesting during one year. So far this seems to be the most solid proposal and it is likely that it will be on-chain soon for voting.

The Neutron proposal 25 is to implement the Neutrality v2.0.0 software upgrade on December 20th. Some of the highlights of this upgrade are the integration of Duality into Neutron, upgrading the Cosmos SDK from 0.45 to 0.47, upgrading the wasmd module to v0.45 and updating also other modules.

The ICF announced the funding for 2024, a total of $26.4 million. Informal Systems will receive $3 million for work on CometBFT. Then, for work related to Cosmos SDK, Binary Builders and Zondax will receive $4.5 million. For IBC, a total of $7.5 million will be allocated to Informal Systems, Interchain GmbH and Strangelove Ventures.
Confio will receive $2.5 million for work on CosmWasm and Cosmology will receive $155k for work related to CosmJS. For security audits for the Interchain Stack, $1.5 million will be allocated.
For work on the Cosmos Hub, $3.5 million will be allocated to Informal Systems and Hypha. Finally, $1 million will be allocated for the Interchain Builders Program and to fund the Interchain Developer Academy and other developer onboarding projects.

Events/conferences

Cosmocon 2023 happened on the 5th December in Bangalore, India. This follows the previously successful event in 2022. OmniFlix Network, Osmosis or Agoric were amongst the organisers and participants in this event.

Osmosis news

The Cosmos hub proposal 858 passed to provide 900k ATOM for ATOM/stATOM liquidity. In particular, 90% of this amount will be for a static liquidity position of stATOM/ATOM, and thanks to supercharged liquidity on Osmosis, this liquidity will be 15 times more efficient than in classical AMM like Astroport for example. The remaining 10% of the amount will be for the stATOM/ATOM Dynamic S+ vault on Quasar.

You can now liquid stake your OSMO on pStake and provide liquidity on the new stkOSMO/OSMO supercharged pool. There are 50k pStake incentives. The launch of stkOSMO also kickstarted the new pStake chain decentralization strategy. It consists of an automated mechanism selecting the host chain validators and with daily adjustments. The mechanism considers on-chain data for the delegations such as voting power, uptime, governance participation, commission and more.

Juno news

The Juno v18 Epona upgrade was successfully completed. This upgrade brought three new modules to Juno for developers to better leverage their smart contracts applications. In particular, the three new modules are the FeePay module, the CosmWasm CW-Hooks module and the Burn module.

Persistence news

The Cosmos hub proposal to allocate 600k ATOM for liquid staking growth of pStake was approved. These 600k ATOM will be used as Cosmos hub Protocol Owned Liquidity to increase stkATOM liquidity on Astroport on Neutron and Dexter on Persistence.

There are several exciting updates in the Persistence ecosystem. Firstly, as previously mentioned stkOSMO is now live with incentives on Osmosis. Moreover, stkXPRT is approaching also and the new pStake host chain validator selection mechanism has already been applied for Osmosis, and will soon also be implemented for the host chain validators in the Cosmos hub by January 2024. Liquid staking for DYDX is also expected soon. Another important update is the launch of the unified pStake front end for liquid staking for ATOM, OSMO, BNB and with DYDX and XPRT expected to be added also very soon.

Secret Network news

The new Secret network grants program was announced and started on December 1st. You can submit your application during the first three weeks, then there is a two week selection process and in the 6th week the grants recipients will be announced. Every three months a new grants cycle will start. The focus will be on funding fewer projects around 3 or 4 per cycle. For the first cycle, the priority will be for privacy as a service, meaning projects developing applications in the EVM ecosystem that leverage confidential computing features provided by Secret Network. Applications will be evaluated regarding team strength, relevance to the Secret network roadmap, benefit to the ecosystem and more. For the first December cycle, a total of 300k SCRT will be awarded to the selected projects.

Secret network started a channel on OmniFlix TV releasing several interesting and educational videos with interactive quizzes directly included on the videos. Make sure to watch the Secret network videos on OmniFlix TV and participate in the quizzes to test your knowledge about Secret network.

Stride news

The Stride TVL continues to grow and it is now approaching $100 million. A large part of this TVL is from ATOM and OSMO, with other major tokens such as INJ also representing an important part of this TVL. A growing TVL for Stride is great news for STRD and ATOM stakers, since they receive higher rewards.

The stATOM cap keeps maxing out on Kujira, being the most popular collateral token for Kujira’s USK. Recently, Kujira approved a governance proposal to increase the cap of stATOM from 750k to 1 million.

Crypto regulations & compliance news with MME

Basel Committee agrees to consult on targeted revisions to standards on cryptoassets.
The Basel Committee on Banking Supervision announced that it has discussed a range of policy and supervisory initiatives for further development, including cryptoassets. The Basel Committee is the primary global standard-setter for banking regulation and provides a forum for cooperation on banking supervision matters.
In December 2022, the Basel Committee on Banking Supervision published a standard for the prudential treatment of banks’ exposures to cryptoassets. “Under the standard, banks are required to classify cryptoassets on an ongoing basis into different groups related to their risk”. In addition, the standards include also “descriptions of how the operational risk, liquidity, leverage ratio and large exposures requirements should be applied to bank’s cryptoasset exposures”.
On December 14, the Committee issued its “public consultation on proposed amendments to its standard on bank’s exposures to cryptoassets to clarify the criteria for the composition” of the classification of Group 1b cryptoassets i.e., cryptoassets with effective stabilization mechanisms resp. stablecoins.
Since the release of the cryptoassets standard last year, the Committee has continued to explore “two aspects of the classification conditions that determine whether a stablecoin can be included in the Group 1b category, in particular: (i) the appropriate composition of a stablecoin’s reserve assets; and (ii) whether there are statistical tests that can be used to reliably identify low-risk stablecoins.”
•With respect to the first condition — the composition of reserve assets — the Committee has agreed on a number “of enhancements to the asset quality criteria for reserve assets under the redemption risk test; and a set of additional safeguards for reserve assets.” These include proposals for:
-the maturity date for short and long term assets;
-the credit quality to minimize the credit risk to which stablecoin holders may be exposed;
-repurchase agreements with regard to the “treatment of securities financing transactions (SFTs), such as repurchase and reverse repurchase agreements (repos and reverse repos) and collateral swaps”;
-low volatility assets and their likely rapid liquidation without price effects;
-the trading of markable securities in active and sizable markets;
-the ease and certainty of the valuation of the price of assets;
-bankruptcy remoteness, whereby creditors may not have “claims on the reserve assets, except where such parties are also stablecoin holders”;
-the daily liquidity requirements of the assets;
-the risk management framework to assess and monitor the risks of reserve assets; and
-transparency and audit requirements.
•With respect to the statistical tests, the Committee proposes to amend the cryptoasset standard to require banks “to perform due diligence to ensure that they have an adequate understanding” of the crypto asset’s stabilization mechanism and its effectiveness at the time of acquisition and on a regular basis thereafter, and to make the result available to supervisors.
The Committee will continue to monitor developments in bank custody of cryptoassets. It will assess whether further action may be necessary in light of market changes.

Conclusion

And that is all for today’s Cosmos ecosystem bi-weekly review so if you enjoyed it Cosmonauts remember to click that like button, subscribe button and bell icon too. If you are staking ATOM, DYDX or INJ, consider staking with us to support our research and video production, the links to stake with us are included below. Thank you so much for reading and I’ll see you Cosmonauts very soon in the next episode!

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