#39: Governance Gating

This newsletter is supported by Chorus One, an operator of validating nodes and staking services on Proof-of-Stake networks.

Permissioned Smart Contracts for the Cosmos Hub
The decentralized funding pool of the Cosmos Hub successfully allocated 25,000 ATOM (~$67k at the time of writing) to develop capabilities for governance-gated smart contracts to the CosmWasm team. The proposed design will allow Cosmos governance to manage the complete lifecycle of CosmWasm smart contracts, including which contracts are deployed, code upgrades, as well as freezing of undesired contracts.

This permissioned approach could help position the Hub as the center of the internet of blockchains by allowing it to more quickly establish IBC connections to other chains and by providing other useful utilities, including e.g. renting security from the Hub’s validator set to other networks in the ecosystem, while at the same time limiting usage to desired use cases to maintain capacity for essential operations and to avoid putting the Hub and its users at risk with unaudited contracts.

Cosmos on Coinbase Custody
Another big step for institutional adoption of staking with Coinbase Custody integrating Cosmos into their platform. Coinbase is covering losses their customers in case of a slashing event:

“If Coinbase Custody fails to meet certain network standards and slashing occurs, Coinbase Custody will cover this risk and clients will not be impacted by any potential slashing event.”

On-Chain Governance in Celo
Formalized governance is an important piece for any decentralized protocol. Many newly launching Proof-of-Stake networks and also DeFi protocols plan to or do use on-chain protocols to make decisions about code upgrades and parameter changes. The recently launched Celo mainnet steps into the footsteps of networks like Cosmos and Tezos with a custom governance process consisting of multiple steps. This post on the Chorus One blog goes into the details of how proposals like those that were implemented to activate transfers and staking rewards pass through the process.

Blockdaemon Node-as-a-Service $5.5m Raise
Blockdaemon raised $5.5m as funding for their node management platform and marketplace that helps users deploy, scale, and monitor blockchain nodes and validators. After Bison Trails and Alchemy, Blockdaemon is another prominent node infrastructure company raising significant amounts of money in the past year.

Google Cloud to Become Validator for Blockchain Video Delivery Network Theta
Google Cloud is entering the blockchain node provider industry and will join the video delivery network Theta as the fifth of 31 external enterprise validator nodes on the network with staked tokens provided by Theta Labs. Users of the Google Cloud platform will also be able to spin up so-called Guardian nodes for the Theta network from the GCP marketplace.

Network Updates

• Polkadot PoA Mainnet: The highly anticipated Polkadot network launched the first phase of their mainnet rollout. In this phase, all nodes are operated by the Web3 Foundation. In the coming weeks, external validators will be able to register their nodes and then staking will be activated to upgrade to a permissionless Proof-of-Stake network.
• NEAR Stake Wars II: NEAR’s incentivized testnet went into the second round, in total up to 1 million NEAR tokens will be given out to participating entities. In addition, the team published template design for stake delegation through smart contracts. NEAR allows validators to customize their delegation contracts, allowing for differentiation, e.g. with respect to fee structures, but also through integrations with other open finance protocols.
• Harmony Open Staking: Open Staking on the Harmony Network went live with a marketing blitz characteristic of the project. It launched with 1000 nodes competing for 320 slots across 4 shards. Shortly after talk started surfacing about smaller validators getting pushed out by rising staking requirements, with the current bid at nearly 6 million ONEs (currently $210,000). Last year Chris shared some early thoughts and concerns on Harmony’s staking economics here.
• Cosmos Game of Zones Phase I: The GoZ team announced the GoZ Phase 1A and 1B winners. Phase 1A’s goal was to demonstrate liveness. It was characterized by an unreliable Hub that halted and had to be re-started after an emergency patch was released. Through it all 4 teams were crowned as Phase 1A winners. Phase 1B, which focused on lite client and trust period experimentation, particularly related to efficiency in the form of gas optimizations, awarded a single team as the winner.
• Keep tBTC Shutdown and Relaunch: Keep Network’s tBTC bridge to Ethereum executed a safety shutdown shortly after launch due to an issue in the redemption flow. The protocol will be relaunched with a release candidate strategy that will gradually increase limits of how much Bitcoin can be transferred onto the bridge.
• Matic Mainnet Roadmap and Delegation Explainer: Layer-2 scaling network Matic is preparing for the gradual launch of their mainnet and released a detailed roadmap. In addition, the team has released a tutorial of how to interact with staking to prepare $MATIC holders planning to delegate their tokens.
• More Mainnets: A few other networks with staking mechanisms launched: Centrifuge, Band Protocol, and Ren.

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Staking Economy is written by Felix Lutsch from Chorus One with assistance from Chris Remus, operator of the Chainflow validators. Join us in the Staking Economy Telegram to discuss staking. Opinions expressed are our own and do not necessarily reflect the opinions of Chorus One. All content is for informational purposes only and not intended as investment advice.

Originally published at https://blog.chorus.one on May 29, 2020.