#0xPedro | Illuvium — Staked Weight Voting Power IIP

1 messages · Page 1 of 1 (latest)

golden mirage
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0xPedro | Illuvium — Today at 9:25 AM
Hi guys! Wanted to raise a discussion for an IIP for the next elections. Current implementation of vILV that has been deployed after IIP-26 takes into account staked balance, so no matter for how long an ILV or ILV/ETH deposit has been locked, it will have the same voting power if the balances are the same. I would like to propose to the DAO a new mechanism that takes into account the same weight function that is used to calculate staking rewards and rev dis in staking v2 to be used for vILV, so you can receive more voting power according to your weight in staking v2, which is a result of your staked values and lock duration. This way we have a much fairer system in my opinion and it also maintains a technical standard across different products/protocols.

This idea if proposed in an IIP and approved could work as the base of what I'm thinking for staking v3 in L2 as well, so would love to receive your feedback and whether it makes sense to propose or not.

worldly zinc
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I really like this idea, it's in-line with IIP-26 and further protects against Sybil attacks. It also provides some level of protection against Sybils for L2 staking, which is novel (as cost would not be a substantial barrier on L2). Just to be clear, this would use the same multipliers that staking currently uses, 1.083x for 1 month lock, scaling up to 2x for a 12 month lock? Would the multiplier be applied before or after the vILV calculation? Ex. 25 ILV = 5 vILV currently. A 2x multiplier could be applied before the square [sqrt (25*2 ILV) = 7.07 vILV)] or after the square [sqrt(25 ILV) * 2 = 10 vILV]

golden mirage
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@lucid thistle

calm stag
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I like it, and would do it after square. I immediately got a feeling that I should stake the new bag for a year too, if this were the case, so should incentive some more long term holders

gilded ridge
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Multiplier after the square gives more voting power to smaller holders correct?

elder crown
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I love this idea. The only pivot I have that is more a question of technical feasibility is whether it can account in for time staked, not just time locked.
For example, someone locked for a year at the beginning of staking, but now is unlocked
Can they gain an added governance weight to further incentive by not unstaking and reward their commitment to the dao?
Potentially cliffed thresholds, stake for a year, 2x multiplier. For each year beyond that, gain an additional 1x, e.g., second year 3x, 3rd year 4x vilv power. Just a thought to enhance value of staying staked and increase governance value for those most committed.

topaz vault
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I think it is a great idea and i agree with incentivising people to re-lock. Those that can cash out at any time after a bad decision is made, will have less risk and thus less reason to give it their all to look for and vote for the most suitable council member.

Would vesting tokens have a weight instantly of that of a 1 year staked token?

And if you have 25 stakes then would we just take the sum of your tokens staked like now, and multiply it with the max locked stake that you have?
Or would iy be better to take the sum of each individual stake multiplied with its individual time locked?

This:
Sqrt(sumILV×maxTime) = vILV
Would be simpler than something like:
Sqrt(ILVStake1xTime1 + ILV2xT2 +...) = vILV

Function one may make a wallet with a long stake interesting for you to hold onto, because adding ILV staked in that wallet would have a stronger gain in vILV.
Function 2 would be more difficult but would treat anyone equally if they loaded up on ILV to stake at any given point in time.

zenith cargo
elder crown
# zenith cargo My situation is: - staked for 6 months - staked for 12 months - now in a month ...

I'm sure there a lot in this situation. Personally, my biggest stake is in a regular metamask. Thanks a large part to illuvium, I learned more and got several hardware wallets over the past year. I face the challenge of giving up my 2x weight for security. I'll likely do this (for tax purposes also) in the next month. Given kyc elements or other limitations to take your staking weight with you, it feels any wallet movement likely comes with a reset in weight.

zenith cargo
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Also, if we value longer stakers then Kieran would gain more and more power over time. Problem is not Kieran but theoretically holders from the start will be the only one having enough vILV to change anything in voting.

If we giving more power to longer stakers imo it should be 10% max every new year. 2x seems extreme to me.

gilded ridge
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What about only giving more voting power to locked tokens. Once unlocked you loose your voting multiplier? To promote relocking? I worry if time is factored in early og whales will have loads of power and newer investors might be turned off and think their vote doesn’t matter much.

zenith cargo
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Hopefully, this helps visualize the proposed ideas (and hopefully i'm not wrong with math).

I think giving more power to longer stakers just gives too much power to people that were here early. But I also don't really agree ith b0tch. Maybe somewhere in the middle where you only get the multiplier on the locked tokens?

image.png
gilded ridge
zenith cargo
worldly zinc
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There's some value in just using weight instead of any complicated case by case calculation that increases YoY. New staker with 12 month lock? 2x weight. Unlocked staker whose 12 month lock has concluded? 2x weight. If I understand the proposal correctly, I think the idea is that the voting calculation could directly pull the staker's weight. I do like your visual Binet, it shows the scenarios very clearly and your math looks right to me.

Agreed that the multiplier after the square makes the most intuitive sense, as it's a literal doubling of your vILV with a 2.0 weight compared to a 1.0 weight, which cooresponds with the multipliers people know from staking.

The only potential advantage I can see of an increasing weight (beyond 2.0, for stakes exceeding a year) is that it further discourages Sybil attacks. It seems likely that most people looking to exploit a voting system would be opportunistic, and unlikely to have thought 3-4 years ahead and staked on multiple wallets to reach the weight needed to be effective. Definitely worth thinking about in the context of L2 staking, as the massively reduced financial cost of transferring/staking would definitely open the doors up for someone who wanted to exploit the system, even at a 1.08x multiplier compared to a 2x multiplier.

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I wonder if there's some way to have logarithmic growth of voting power after a year that isn't horribly complicated. Something in between a doubling of the initial value every year and no growth at all.

zenith cargo
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Would you elaborate a bit more on why you think the b0tch’s idea is not worth it if it’s not hard to implement?

worldly zinc
# zenith cargo Would you elaborate a bit more on why you think the b0tch’s idea is not worth it...

On relocking? I don't think relocking is consistent with other aspects of the tokenomics. It seems relatively unfair and ineffective to require stakers to consistently relock their tokens for them to have a slightly higher voting power in governance. I know I personally would NOT relock to double my voting power, and I think most people would feel the same. To make relocking worthwhile, some additional mechanisms would have to be in place to either disincentivize keeping unlocked deposits staked, or to incentivize having locked tokens. Both of those would be major changes to the systems in place.

Taking it back to a high level, the main goal is to ensure genuine voters' votes matter, and to limit (or ideally eliminate) the potential for Sybil attacks. Freshly locked stakes having maximal voting power (more voting power than someone who has been staked for say, 2 years) does not limit the potential for Sybil attacks, and it disproportionately gives voting power to new stakers. I'm not convinced that's an optimal solution to the problem we're trying to solve.

zenith cargo
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Is it beneficial to the dao to have more ILV locked?

I agree with your last point (that it doesn’t protect from sybil attacks).
But in the same time I think:

  • someone who is willing to lock tokens for a year trusts the project more than someone who has been here for 2 years but can unstake tokens day after voting
  • I wouldn’t (just like you) stake it again just for more vILV
worldly zinc
# zenith cargo Is it beneficial to the dao to have more ILV locked? I agree with your last poi...

Generally speaking, yes, there's some extra stability that comes with more locked supply. Like you mentioned, it's more a question of whether the incentive to relock exists, and the only ways I can see to create those incentives involve changes that are much bigger than vILV calculations. Given the option of major changes to accomplish a moderate goal, or a minor change to accomplish a moderate goal, I think it makes sense to make the minor change and not redefine staking tokenomics.

zenith cargo
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I'm thinking about it more and for example:

Somebody with 16 ILV now has 4 vILV and would have 8 vILV after the change (with weight 2.0)

If that somebody for some reason wants to split that into 16 wallets and stake it:
Somebody still has 16 ILV now with 16 vILV and would have 32 vILV after the change (with weight 2.0) and around 17.3 vILV with staking for 1 month only.

The difference is that somebody wanting to do that would have to stake it for a year and not just a month if he wants to gain the same advantage as before the change. And that's a big difference I guess.

Also, I think the healthy change would be that you need at least 1 ILV staked in order to vote.

I consider a lot of other formulas, but I don't think any of them are good enough or better then this.

image.png
gilded ridge
zenith cargo
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10 wallets staking 0.1 ILV would have similar voting power as somebody with 10 ILV staked.

We need a different formula for <1 ILV in that case. But I would for now just not allow <1 stakers to vote.

zenith cargo
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Maybe just change it that at no point you can have more vILV then ILV staked?

hard flame
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Agreed, I wonder if you could take it a step further and actually reflect time staked, whether that even be 2 years or 3 years,

Those that have been around Illuvium for longer better understand its history and therefore should theoretically be better decision makers on the topic of council members? That may impact newer members who wish to run for council which I don't like

gilded ridge
hard flame
zenith cargo
# hard flame Agreed, I wonder if you could take it a step further and actually reflect time s...

In that case you are giving to much voting power to people that were here early.

There are two wallets this election who could have singlehandedly chosen anyone and he or she would be in the council. Giving them an extra x2 or x3 is not a good idea as then in two years we basically have: Kieran you choose one, Luggis you choose one, whoever else you choose one... And I don't think we want that.

In part that was because of not that many people voting, but imo that's too much power to people who were early, and even though they maybe have "better understanding of Illuvium history" then it loses the point of voting.

Like I said before, if we have to do this, I don't agree it should be more then 10% extra voting power per year. But I don't see any point in adding that.

hard flame
golden mirage
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Bear with me here…. Just to play the devils advocate…. What if no one really is interested in buying a governance spot? What if, just what if everyone in crypto makes up too many conspiracy theories?

elder crown
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But that one time it could happen!
Honestly, blind voting worked exceptionally well this time. There could have been easy conspiracy theories this time avoided.
I like this as a mechanism to incentive continuing to be staked, so interesting to see what is possible

spice solstice
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cool idea. love it

lucid thistle
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Hi everyone!
Catching up with the messages, I'll try to answer most of the questions raised, so:

1 - Is the multiplier applied before or after the vILV calculation? How is vILV calculated?
I noticed there's an incorrect perception on vILV calculation, that's my fault actually and it should be more clear in our documentations. So at the moment vILV is a smart contract that will return your balance based on your staked tokens and vesting tokens (for team/investors). The quadratic voting mechanism is a snapshot thing, so vILV contract performs calculations based on its code by querying Illuvium contracts, returns a raw vILV value which then snapshot applies the square root for the final voting power used in council elections. This means any weight multiplier is applied at the contract level, so the final result of someone that has for example 4.5 ILV staked for the max period would be:

**vILV contract return value: 4.5 ILV * 2 weight multiplier = 9 **
Snapshot voting power: sqrt(9) = 3

2 - Can we increase weight multiplier for those who are staked for longer?
Yes we can. Technically we could check when someone created a specific stake, and if lockedUntil > block.timestamp we use current block.timestamp value to calculate weight. And yes we could switch the equation to a logarithmic function for added weight post stake unlocking. However I'd need to test in terms of gas usage to make sure we're safely under eth_call read limit, i.e it's impossible for any staking address to be self DoS'ed, as checking stake lock period initial timestamp would require looping over each individual stake. So I'd say if that's something the community really wants to add in the proposal, give me a few days to test it before we make a call on it pepePray

3 - Would vesting tokens receive a 1.0 weight multiplier or a 2.0 weight multiplier?
Technically we can move with any of these approaches. It's up to the community to the decide and that can be optionally included in the IIP or not, or voted separately as an ICCP later if preferred.

Hope that answers most questions 😄

cold summit
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Really like this.

robust oak
# lucid thistle Hi everyone! Catching up with the messages, I'll try to answer most of the quest...

Hi Pedro! Wanted to initially ask the intention behind the proposal. It seems like the idea is evolving based on what Ive read from others so I wanted to try and tie it back to the primary purpose and identify the secondary benefits to see if both are aligned.

  1. Your explanation in number 1 is what I was thinking as well and definitely makes sense.

  2. This is where I wanted to tie it back to the primary purpose. By anchoring to the token weight are we just trying to give importance to those who have been staked longer regardless if its a year or more? And would it make sense to award longer than the token weight or not.

  3. Vesting tokens should follow whatever is decided for staked. Vesting tokens are earning at a 2.0 weight anyway.

gilded ridge
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Do we have to use snapshot for Quadratic voting or could we include the sqrt in the vILV contract?

golden mirage
hard flame
safe ginkgo
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Just tossing my vote of approval. Amazing concept. 2mo vs 12mo stakers think differently

lucid thistle
lucid thistle
lucid thistle