Cosmos Governance Report — Week 1, 2024
During the holiday period between late December to early January, Governance doesn’t take a break which means that neither do we. Throughout the holiday season, we have also decided to change our naming scheme for our reports and have opted for an easier Week by Week naming scheme rather than specific dates.
Between the 21st of December and the 3rd of January of the new year, Simply Staking voted on 24 Proposals across multiple chains in the Cosmos Ecosystem including the Cosmos Hub proposal to provide funding to the AADAO, an Alignment Treasury development proposal also on the Cosmos Hub, and more.
In the following report, we will give a quick summary, some extra detail, and our reasoning for voting the way we did in an attempt to make Cosmos Governance more digestible.
We hope you find this article insightful and if you do, please consider delegating to our Validator on any of the networks mentioned above!
Table of Contents
Cosmos Hub #865 — Funding ATOM Accelerator DAO (AADAO) renewal proposal
Cosmos Hub #864 — Development Approval Request for the ATOM Alignment Treasury
Osmosis #698 — Add Celestia (TIA) as a Quote asset
Osmosis #699 — Change Pool Creation Fee to 100 USDC
Persistence #63 — Collaboration with CryptoCrew for guaranteed Relayer SLAs
Persistence #64 — Incentivization of Dexter pools with XPRT from Dexter Grant for January 2024
Regen #38 — Param change for InflationRateChange
Omniflix #25 — Increase Minimum Deposit for Governance Proposals
Funding the ATOM Accelerator DAO (AADAO)
The AADAO was first introduced through Proposal #95. The DAO aimed to take some of the burden away from public governance and to have a singular spot for teams and developers who want funding to apply.
Fast-forward to the end of 2023, the AADAO had a successful first mandate at performing the tasks at hand. We won’t dive too deep into the statistics and milestones that they have accomplished. We will however link their 2023 IMPACT REPORT highlighting all of this.
Proposal #865 is the renewal proposal for the AADAO to continue with its mission.
The proposal asked for 975,811 ATOMs with the aim of establishing AADAO as a ‘long-lasting organization exclusively focused on protecting and promoting the highest interests of the Cosmos Hub.’
Some new implementations will feature in this new chapter of the AADAO, including the move towards using DAODAO for operations of multi-sigs etc.
The Oversight Committee will have a ‘community elected member’ be the third member of that committee and, the Oversight Committee will have VETO powers on any potential grant that they deem fit to be vetoed.
Our Protocol Specialist Damien will be a member of the Oversight Committee for the AADAO in the coming term.
For more changes please read more on the full proposal.
We voted YES on this proposal as we are happy with the work that the AADAO has been doing in strengthening the Cosmos Hub (with the term AEZ).
ATOM Alignment Treasury Development Request
The proposal is a temperature check seeking approval from Cosmos Hub governance to start development on the ATOM Alignment Treasury (AAT).
The ideation of this started from an RFP from the AADAO (all research including from this proposal was funded by the AADAO as stated by the authors).
According to the authors (Noam Cohen and Binary Builders), the AAT ‘is an infrastructural solution to two problems’.
The two problems, Liquidity deployment in the AEZ and Alignment between Consumer Chains and the Hub aim to be addressed through the AAT instead of the reliance on manual multi-sig wallets.
Liquidity Deployment
We have seen a rise in Protocol-Owned-Liquidity (POL) proposals on the Cosmos Hub causing a large number of tokens from the Community Pool to be ‘locked’ away for some time. The AAT aims to take a portion of the Community Pool funds and reserve them purely for those chains that are deemed to be aligned with ATOM and deploy the funds there.
The separation of tokens marked for POL and the rest of the Community Pool asks is important to understand the current health of the Community Pool in our eyes so the AAT would be solving that issue.
The other benefit of making use of the AAT would be the lack of multi-sig usage. As it stands, all POL from the Hub is under the control of a few individuals through multi-signature wallets. While these people don’t intend to act maliciously, we do not like a future where funds are manually locked away and in the hands of the multi-sig wallet therefore using a different approach would solve this issue before it gets too large to keep track of.
Alignment between Consumer Chains and the Hub
The AAT aims to allow the Cosmos Hub to vote on Consumer Chain Governance proposals that can affect the Cosmos Hub. Currently, there is no real mechanism for the Hub to vote on Consumer chain proposals.
The process the AAT proposes is as follows:
- A consumer chain has a proposal up in the voting period
- The Cosmos Hub uses Interchain Queries to periodically update its list of currently active CC proposals
- Cloning of Consumer Chain proposal on the Cosmos Hub with an expiration date of a day earlier than on the Consumer Chain.
- ATOM holders vote
- If the quorum is reached, the Hub casts a weighted vote on the CC over IBC.
We voted YES on this proposal as we would like to see the development come to fruition and we hope that the team at Binary Builders would be able to develop the goals they had stated in the proposal.
Celestia as a Quote Asset on Osmosis
Quote assets on Osmosis allow for the asset to be used in pairing in Supercharged Liquidity pools, as well as allowing for pools to be priced in the terms of that asset rather than the paired token (OSMO).
Having Celestia (TIA) listed as a quote asset on Osmosis comes with no resistance especially considering that since its launch nearly two months ago, Celestia trading has been the highest (or one of the highest) in terms of volume and fees generated on the platform.
The Proposal will introduce the following:
- Permissionless SuperCharges Pool creation with TIA as the quote asset
- Osmosis Community Pool would earn TIA rather than selling for USDC
- Incentives would begin at the next monthly incentive proposal for all TIA pools paired with another quote asset.
Allowing all of the above should ensure that Osmosis remains the largest DEX for TIA trading in the next cycle. We voted YES.
Osmosis Pool Creation fee to 100 USDC
In continuation to a previous signalling proposal (proposal #682), this proposal seeks to change the fee to create a pool to a stable figure. The easiest way to ensure a stable figure in a volatile crypto market is by making use of stablecoins.
In the same proposal mentioned above, the figure for which the Pool Creation fee was specified.
This current proposal merely puts the change on-chain with a parameter change.
The changes are as follows:
Pool Creation from 400 OSMO -> to 100 USDC
We voted in favour of this as per our stance on the previous proposals.
Persistence Relayer SLAs with CryptoCrew
Persistence has entered into a 3-month agreement for CryptoCrew to provide guaranteed and reliable relayer operations as they are integral to the operation of pStake and Dexter.
The SLAs are as follows:
Uptime: 99% (within the last 30 days)
Alert Response: Within 30min for pagerduty alerts
Incident management: 24/7 incident response team
Redeployment readiness: At any given day
The ask is for 57,826.52 XPRT which is now roughly $30,000 at current prices.
CryptoCrew will maintain 6 chains:
IBC relaying for 6 chains (incl. Transfers & ICA): Channels may vary, but starting with CosmosHub, Osmosis, dYdX, Noble, Kava, and Neutron
We voted YES on this to ensure the smooth operation of Persistence products as well as the smooth operation of IBC channels and packets for Persistence.
Dexter Pools Incentivization with XPRT
A previous proposal made XPRT the base token for Dexter (a DeFi protocol on Persistence).
This proposal seeks to incentivize the following pools with XPRT once their current incentive cycle ends:
ATOM/stkATOM — 4,500 XPRT
PSTAKE/XPRT — 3,000 XPRT
USDC/USDT — 15,000 XPRT
DYDX/USDC — 2,000 XPRT
These incentives aim to attract liquidity and ensure the continued increase in liquidity on the Dexter Platform and those pools.
We voted YES on this proposal to allow liquidity to flow towards Dexter.
Regen Inflationary changes
The Regen Tokenomics Group has been in discussion to adjust the Inflation parameters to lower the costs on the network. On a Proof-of-Stake (PoS) network, the biggest costs are those associated with paying validators to help secure the chain. This is oftentimes done through Inflationary rewards. So reducing the Inflation on any PoS chain is tricky due to the direct impact it might have on Validator operations which then impacts the network security.
In the below article, there are most details and discussion on this matter.
The proposal that passed recently had to do with the rate of change of inflation. The parameter “inflation_rate_change” changed from 0.13 to 1, which is in line with what is set on the Cosmos Hub.
We voted YES to allow for a larger range of dynamic moving that Inflation can move by on the network.
Combatting Spam on Omniflix
Proposal #25 is an attempt to help mitigate the current wave of spam proposals surfacing on Omniflix. The image above highlights the current situation in which the majority of on-chain governance votes are deemed malicious.
We promptly expressed our opinion on those proposals by Vetoing them so that the malicious actors' tokens could be burned.
Proposal #25 aims to make governance costlier to make malicious actors lose more tokens.
The proposed governance deposit parameter changes:
From 1000 FLIX ($240 at current prices) -> To 5000 FLIX ($1200 at current prices)
We voted YES on this proposal to protect delegators on the platform who might not interpret the proposal as malicious.
About Simply Staking
Simply Staking is a blockchain infra provider across 40+ networks, across various ecosystems. PoS validators on Cosmos Hub from Genesis, Oasis, Akash, Kusama, Polkadot, and many more.
We also operate node infrastructure on the Chainlink network providing price feeds to Aggregator contracts which are used by major Ethereum DeFi apps. Our participation in Chainlink aggregator contracts spans other networks such as Layers 2s, BSC, MATIC, XDAI, RSK, and more.
We’re also a Lido ETH2.0 operator, enabling us to run 1000s of ETH validators.
Simply Staking also comprises other development teams building financial, blockchain, and infra-monitoring tools.
All our infra is run off self-hosted or co-located servers, with no cloud usage at all and our base being in Malta.
Stay tuned to Simply Staking for more Governance updates:
- Website: https://simplystaking.com
- Twitter: https://twitter.com/SimplyStaking
- Discord: https://discord.gg/Kpzc58Gu9a
- Telegram: https://t.me/SimplyVC
