Staking V2 is coming closer to launch and we would like to take this opportunity to discuss parameters around the new staking mechanism. While the contracts for staking are already being finalised and the new governance UI application makes good progress, we still have a few open questions around the specific parameters. We would like to get the community, Governors and Metanauts involved in this discussion and find a solid consensus around these parameters.
The full proposal will be posted soon and contains a lot more details and explanations. However, the proposal is also quite lengthy, therefore it makes more sense to discuss the particularities in a separate thread.
This is a very basic explanation of Staking V2 in order to give enough background to initiate this discussion around the parameters.
At the very beginning, the user has the choice to stake MTA or 80/20 MTA/ETH Balancer Pool tokens. Additionally, the choice will be given to delegate the votes to a particular address or to self delegate. The delegation can be changed at any point. The UI will support the user to choose a delegatee. The staked amount is locked into the staking contract and is non-transferable. No lockup duration is chosen.
Before a staker can withdraw all or a portion of the staked tokens, the user has to initiate a cooldown period. The suggested duration for the cooldown is currently 3 weeks. After the cooldown, the user has 2 weeks of a withdrawal window. If the staker does not withdraw during the withdrawal window, a new cooldown needs to be initiated.
Additionally, early withdrawals are subject to a withdrawal fee (see chart). The maximum fee is 10% during the first 2 weeks and after 48 weeks the fee is 0%.
Both mechanisms are to ensure, that during a period in which MTA experience a stressful event (such as losing peg of a mAsset), no staker can withdraw in order to avoid recollatorisation. The slashing percentage is set initially to 0%, hence is not active at launch. But can be activated with a future proposal.
A second reason is to avoid malicious vote manipulation. This is especially important with a future release of the reward gauges, in which stakers can choose the allocation of MTA rewards.
Stakers can earn 2 different sets of multipliers - time multipliers that reward long-term staking and quest multipliers that reward participation.
Time multipliers are earned in the following manner:
|less than 13 Weeks||1|
|longer than 103 Weeks||1.6|
Quest multipliers come in 2 different variants, permanent and seasonal. Seasonal multipliers are only valid for the duration of the season (9 Months). Quests with permanent multipliers are reserved for high-value actions. Seasonal multipliers are added to allow stakers to increase the scaled balance during the season while at the same time avoiding the accumulation of multipliers and hence give newer stakers a fairer chance to participate. An initial permanent multiplier could be given to stakers who migrate the staked amount from staking V1 to V2 in a specific amount of time. Quest multipliers can only be within the range of 1 to 1.5.
Multipliers scale the staked balance and result in the scaled balance. This scaled balance is used for rewards accrual and voting weights.
A QuestMaster is a set address that can add new quests, expire quests and start a new season. It is not advisable to make this functionality public. It is proposed to initially form a Questing Committee that consists of mStable contributors and set the QuestMaster to an address that is controlled by this Committee. This would allow for enough control in the beginning to develop quests that are aligned with the goals of mStable and that are within the realm of possibilities, while also ensuring that the functionality is built into the application to complete and verify a quest. If questing establishes itself as a core feature of staking, a future proposal could decentralise this Committee further.
Any ideas for quests are welcomed. Join our discord and we can have a discussion around that there. But please refrain from discussing quest ideas in this thread, as we would like to focus the discussion around the mentioned parameters.
Staking from a contract would initially be by default not allowed. This is due to the possibility that a wrapper contract could circumvent the staking and unstaking procedure, hence making it obsolete and weaken the design for MTA acting as a backstop solution. Wrapper contracts that are beneficial to staking can be whitelisted via a proposal and governance vote.
What are your initial thoughts around these staking mechanics around delegation, withdrawal mechanics, questing, and wrapper contracts?
In particular, I would like to get feedback on these parameters.
- 80/20 MTA/ETH Balancer Pool as a good second choice to earn swap fees and to deepen the MTA liquidity?
- How long should be the cooldown period and withdrawal window? Currently suggested 3 weeks and 2 weeks. Is it too long, or too short?
- Early withdrawal fee design, fair or too punishing?
- Time multipliers are incentive enough to keep staking? Are those multipliers chosen fair?