Abstract
Metis Liquid Staking Blitz (LSB) is an initiative focused on accelerating the growth of Liquid Staking Tokens (LST) and LST-focused products on Metis, leveraging the 4.6M METIS Ecosystem Development Fund. LST platforms may submit proposals to Metis Governance Forum. A limited number of LST applicants will win the right to be paired with a decentralized sequencer node, opening up liquid staking to a pool of 20,000 to 100,000 METIS tokens per node.
This proposal aims to establish and communicate governance procedures related to the LSTs protocols.
LSTs
The term βLSTβ derives from its inherently liquid characteristics, allowing users to stake their assets while maintaining flexibility in navigating the DeFi landscape and enabling opportunities for additional yield. This option is particularly appealing to those seeking alternative methods to generate returns on their assets without being bound by fixed lock periods as soon as the partial withdrawals mechanism is enabled (currently in testnet).
Metis has set up a process in which node operators may be paired with Liquid Staking Tokens protocols, opening the door for the staked tokens to come from users. At this moment we foresee the following rounds of LST protocols onboarding:
- Round 1 (Alpha launch) - to pair with the Metis Foundation sequencer nodes
- Round 2 (Main launch) - to pair with the rest of the sequencers run by the community
- Round X: Subsequent applications to become LST protocol
Upon adding additional sequencers it is possible to execute additional rounds of LST protocol onboarding.
Round 1: Alpha launch (completed in March 2024)
- Metis Foundation has facilitated the opening of 4 sequencer nodes, to ensure smooth transitions and network stability for Metis LST protocols.
- Selection of other nodes and 2 LST protocols occurred based on the outcome of the submitted community proposals: highest number of Metis votes received plus hitting quorum
Latest lst-protocol topics in Approved - CEG - Metis.io
Round 2: Main launch (to be completed in June 2024)
- Metis Foundation will facilitate the opening of additional sequencer nodes to be paired with the LST protocols
- A governance process will occur whereby the passed proposals receiving the highest amount of METIS votes and quorum will have the opportunity to be paired with the sequencer node
- Stage 1 - all potential LST protocols will submit their proposals on a Metis Governance Forum and will be voted by the community
- Stage 2 - The sequencer node provider will choose the qualified LST protocol which passed the voting and submit a Metis Governance Forum announcement to notify the community about their decision and reasoning for that
Round X: Subsequent applications to become LST protocol
- Upon sequencer nodes onboarding community may choose to open up external access to newly added sequencer nodes and in that case, steps listed in Round 2: Main launch will be repeated at the time of sequencer onboarding
Governance Procedures
The following list of governance procedures covers a lifetime of the LST protocol - starting from proposing an LST protocol, covering onboarding, βoffboardingβ and situations leading to that.
Proposing a LST protocol
The LST protocol will be proposed using the Metis Governance Forum. The proposal should be submitted using the Infrastructure proposals - LST type. It will follow the process related to that type of proposal presented in the Governance Bruepaper - Roadmap (Governance (Proposal Types)). The proposal will be tagged as a βlst-protocolβ proposal.
Voting procedures
Voting will happen on a Snapshot using the LST protocol Proposal suffix in the proposalβs subject. Only top LST protocols which satisfy below Voting criteria will be eligible for pairing with the Sequencer node.
Voting criteria
- A quorum requirement of
- 20k METIS tokens
- 500 or more wallet addresses participation
- 80% or more approval vote to pass
Onboarding/Offboarding
Onboarding and offboarding requests will be made by the members of the community using the Metis Governance forum. Accepted proposals will be voted upon using the Snapshot voting platform. As described in the Community Proposal Voting Process Flow (metis.foundation) the Governance Working Group will oversee Infrastructure proposals and reserve the right for the veto right on any Infrastructure proposals.
Onboarding
When reviewing the onboarding proposal, the primary evaluation criterion for the LST protocol candidate is the synergy between the sequencer node and the LST protocol. LST onboarding will occur in rounds, with the current round being Mainnet.
Each submitted LST protocol proposal will undergo a vote. Qualified proposals will then be eligible for pairing with the sequencer node provider.
After the voting is completed, the sequencer node will partner with the chosen LST protocol and submit an announcement to the Metis Governance Forum, informing the community about their decision and the reasoning behind it.
LST protocols that are not selected initially do not need to resubmit their proposals; they will remain in the pool for subsequent rounds of pairing.
Onboarding of the LST protocol includes the following steps:
- Submit a CVP proposal to become a LST protocol on the Metis Governance forum using Infrastructure proposal - LST type
- Template of the proposal
Title: LST protocol Proposal: [Project Name]
Executive Summary
- Information about the project, total staked or locked assets, clients, etc.
- Background and Integrations
- Protocol Stats
Protocol Architecture
- Strategy
- Token Economy
- Rewards Distribution
Benefits for Community (optional)
Integration Roadmap
Official Links: Website, Docs, Audits, etc.
- The tag to be used is: lst-protocol
- Discussion period - 2-4 weeks
- Snapshot proposal
- Voting duration - 72 hours
- Pass the vote
- See Voting criteria above
Offboarding
Given the inherent characteristics of LST implementation, it is not possible to βoffboardβ LST protocols once approved. A smart contract can be modified upon request to halt additional METIS deposits into the LSTβs contract, but the automatic return of METIS already deposited into that contract is not programmatically achievable at the time of this proposal.
As new solutions become applicable to manage the potential risk posed by malicious LST protocols Metis team will evaluate their adoption into our ecosystem. Itβs important to note that the risk associated with blockchain is public, and thus, the responsibility for mitigating this risk lies with the participants.
USE AT YOUR OWN RISK