CHECK THE GUIDE - IT’S READY TO GO.
When? Thursday December 16, 15:00 UTC.
-update December 15, 2PM UTC-
The list was upgraded: Element Finance LPs, GTC claimants. Both 10txs+. See below.
-update December 12, 2PM UTC-
The list was upgraded: Tokemak, Convex, MIM. LOBS req 10+ removed. See tweet.
TLDR: This post is related to one of the distribution mechanisms of GEAR tokens which will all occur prior to the DAO-First Launch (meaning that the protocol will be deployed by the DAO, not by the initial core contributors) - called Credit Account Mining. Together with the community, we want to make sure that the list is complete and that everyone can have a say. Credit Account Mining is one of those groups. If you are not on this specific list, it doesn’t mean that you’re out - there will be multiple other ways to get involved.
Buckle up and get your SQL skills ready!
Before we get into the specifics, it’s important to explain the reasoning for why certain choices have been made. When it comes to growth and development of any DAO, project, or even company - there are multiple different people involved - with very different skill sets and different opinions. That’s what allows things to grow beyond the initial tunnel vision. Therefore, the goal of the distribution is to ensure that Gearbox DAO will also have those different groups of people: developers, whales, small community members, governance participants, meme lords, and so on. To foster this, the distribution is targeted at multiple user groups.
Keep in mind that the distribution also has a portion allocated to the initial core contributors, early contributors aka SAFT holders, and will also have a portion for early testers and early Discord community. The snapshot for each of those has been taken already, so there is no point trying to farm points anymore. The discussion on early testers and Discord list will take place in the next few days, in a similar way. The couch has spoken, and we agree. And to jump a bit ahead - the DAO Treasury will have 50%+ of the supply, while also featuring reduced voting weights for the early contributors, to make sure community voices are stronger and bigger. Stay tuned for that separate article. Ok, back to Credit Account Mining.
- The goal of CA Mining is to restock the factory of Credit Accounts (isolated smart contracts) that leverage users can “rent” from Gearbox Protocol later on. This way, leverage users won’t need to deploy expensive smart contracts every time, but instead just rent and give it back to the protocol after closing or being liquidated - this makes the protocol gas efficient! If you want to learn more about this renting model, you can check out the tech paper for now. We will also post another article in the next few days.
- Then, the number of CAs had to be chosen. Looking at the unique DeFi users on mainnet, the numbers are still in the low 4 digits (below 10K per protocol, at best). We don’t expect Gearbox Protocol to be an exception to this just yet, because the protocol is not even live yet! But we also want to make sure the protocol has enough accounts for the first few months. After all, some accounts don’t get closed, some people might open a few at a time, and so on. Therefore, a number of 5,000 accounts to start with - seemed logical. If more are to be needed later on, another ceremony in an auction model could be held, for example, or just deploying from DAO Treasury funds.
- Then, how does one choose who is eligible for it? And now we are getting back to the objective of the CA Mining ceremony: we already have the early testers and early community list (TBD in the next few days, it’s separate), we have some early developers, and some early contributors… So for this ceremony, we decided to include governance participants of other protocols. This achieves the following: (i) choosing users who are familiar with governance and have voted before, so they potentially could be good for Gearbox DAO; (ii) visibility from other community because they are being given a cool chance to take part in the very first days of another DeFi protocol for potential integrations later on ; (iii) slightly works as an anti-sybil mechanism to make sure 1 group doesn’t take the entire supply into their hands, without some document checks pukes.
- The list currently has 37,129 wallets (see below for the query in the next post section). With 5,000 max Credit Accounts possible at this stage, not everyone will be able to participate in this exact distribution ceremony - which is okay, there will be other opportunities. However, the list needs to stay large enough to account for the fact that many of said wallets will either be inactive, or they won’t know of this ceremony, and so on. The gap could be like 5x of the total amount possible, to make sure that if there is demand - it should be met with the said wallets.
- Because of pre-baked extra token approvals in the Credit Account Smart Contracts that will make the lives of protocol users easier later on, it costs approximately 2.5M gas to deploy one such SC. That is approximately 0.25ETH in deployment costs at current gas prices of 100. This of course can vary depending on network congestion.
- The mining is based on FCFS (first come first served) basis. Gas wars could happen. With the current Ethereum block limit of 30M gas, there can be at maximum 14 Credit Accounts in a block. However, as every block has other important launches, liquidations, etc. - it’s likely the number will be lower. This could potentially clog Ethereum for a few hours and make gas costs go up. Let’s say 7 accounts per block * 15 second block = 35 accounts per minute => 2,100 accounts per hour. Technically, it can be done in 3 hours. We apologize for such a design of the ceremony, but it was actually a calculated risk: if done differently, users would have to deploy and then throw away their Credit Accounts every single time, causing much more wasteful gas usage. With the model in place though, there is this one-time event which clogs the network, but at least after that users would be able to just rent Credit Accounts and thus make the network a bit less clogged.
- There is an approximately 48 hour window for this ceremony, after which the DAO votes shall begin. However, if not all 5,000 Credit Accounts are mined within the 48 hour period - they will remain there to be mined by the same wallet list (nothing will change with regard to that). So the window is not anyhow enforced, it’s simply there to start DAO votes asap. If there is not enough for such a ceremony at the start, eligible wallets can decide to mine remaining in a month or even later. To jump ahead, there is no point suggesting to “open up the whitelist for anyone to mine in case 5K are not all taken within 48 hours”. The contracts have been made, audited, and are ready for deployment, so this won’t be changed now. Remember, this is not an ICO, a sale, or anything financial-related for aping: this is a governance distribution of to a specific user group.
- The code for the ceremony will be open-source a day or so prior to the ceremony, so everyone would be able to check what’s going on. Protocol code will be open-source closer to actual protocol deployment, after first votes for the pools & assets.
We arrive at the objective of today being - point iii!
First of all, it’s important to point out that full anti-sybil can’t be done on-chain, because you would need to involve so many tracking tools that you will make your life miserable. Let’s not strive for that. There is no point in doing it, because some people simply have multiple wallets doing voting in many protocols - so are you gonna exclude them? No. GGWP to them, well done and thanks for being active in the ecosystem!
As such, the goal is to refine the list to be inclusive enough yet not too broad; to prevent some botting (like wallets voting with 0.1 token in a protocol for exactly such cases) yet not to exclude potentially real governance participants. Sounds vague, right? Yes, because this is a subjective matter. It won’t be ideal, and it can’t be. But for transparency, let’s discuss it together and try to do the best we can!
- The list was snapshotted at block 13650000 (November 20).
- Dune queries are here - Dune Analytics, Dune Analytics, Dune Analytics.
- Jupyter notebook on Google Collab to retrieve snapshot voters list.
- More info on GitHub including the mechanics.
- TXT file so you can ctrl+f your address. Keep in mind that if the snapshot changes after community discussions, so will the eligibility of some wallets, of course. This is not final.
Who is on the list? Double check, make your own queries, and comment!
Lobsterdao NFT holders as an appreciation to the early community who have helped with ideas and support. We did not see people transferring NFTs to multiple wallets (in order to sybil) so there was no extra action taken yet to sort this out. Please cross-check. No 10+txs requirement (updated).
Snapshot governance of protocols were taken with 10+ transactions per wallet. We thought this would be a good way to filter out possible bot accounts, but this might be a wrong approach. Another way to go about it would be doing minimum balances. Or doing some wallet cross-checks… Please suggest, run tests, and comment.
Snapshot governance of:
- Rari Capital
On-chain governance of:
- ENS delegates
- COMP delegates
- UNI delegates
- veCRV holders
- MakerDAO voters
- Aave voters
- Nexus Mutual voters
- Element Finance LPs with 10+ transactions per wallet
- GTC claimants with 10+ transactions per wallet
Find the tools here. This is up to you to look at, re-make, and suggest ideas to fix. Please do! However, it’s also important to point out some boundaries, in order to avoid turning this from a productive community discussion to people trying to include their bags.
- We took major protocols we thought were active or that have been important to the ecosystem before and now - yes, we of course could not include everyone, and it’s impossible to. Unless there are really strong arguments, the list of the protocols taken would not be modified. For example, we wanted to take Element Finance, but there is no token right now, so we could not.
- As mentioned previously, the list should be big enough (a minimum of 4x of the 5K eligible, so 20K+ is okay) but not too big. The bigger you make the list, the more chances you give to 1 group to take the entire supply of CA Mining. With that being said, full anti-sybiling can’t be done, but some tips and tricks could be applied to the list. And remember: this is just one of the stages!
There are about 3 days max to discuss this, after which the list would need to go into the deployment and all that stuff… the ceremony is approximately planned for the middle-end of next week. Stay tuned, cool videos as well as more content are coming!
This will all be reiterated in one of the next articles, so you can refresh it in your memory.