The launch of V5 on Ethereum Mainnet has been highly anticipated by the community and controversial in terms of how and when it should be executed. This post outlines the roadmap on where we’re at and what is still needed before the Ethereum Mainnet launch.
We are currently waiting on results from three concurrent tasks:
Mitigation Review (Dependent on Sherlock Team, will likely take another week)
Witnet launch on Mainnet (There has been a soft-commitment for the RNG to be ready by the end of July)
Growth Plan (How should the network be bootstrapped? POOL drip? GP boost? No bootstrapping?)
Once there is general consensus on the growth plan, the launch params can be modelled to support the plan. These params will be presented to the community with a period of at least a week for discussion and feedback.
2024-07-12
Sherlock Audit Mitigation Review has been completed
The following are some projections to help inform the choices around the launch and how it should be bootstrapped. These projections are highly dependent on the launch parameters which can be adjusted to create more favorable conditions, but for the sake of simplicity and providing context, the following numbers are based on the assumptions that the launch paramaters are similar to our L2 prize pools.
Assumptions
Prize Pool Share Split: 100/30/4 (tier/reserve/canary)
This is the same as our L2 prize pools, but can be adjusted if needed
The deployment must function normally at high gas spikes up to 100 gwei (over 90% of days in the history of Ethereum have had an average gas price below this)
The average APR of yield vaults on the network will be 5.28%
Projection 1
Draw Period is 1 week
At current gas prices (13 gwei), the protocol would need at least $281k in TVL to award the RNG every week. As a reminder, when the TVL is at the minimum required, the entire reserve is used for RNG auctions and there is nothing left over for przPOOL until this minimum is exceeded.
At high gas prices (100 gwei), the protocol would need a minimum of $2.16m to function.
Projection 2
Draw Period is 2 weeks
At current gas prices (13 gwei), the protocol would need at least $140k in TVL.
At high gas prices (100 gwei), the protocol would need at least $1m in TVL to function.
What does this mean?
If we assume that the deployment needs the highest of these projections ($2.16m) to function, we should create a bootstrapping plan to reach this minimum within the first couple weeks of launching. If we do not meet this minimum, then the protocol may not function correctly and the prize experience will be very poor for depositors. In the worst case, this will cause the deployment to remain dormant until a better bootstrapping plan is created, and may cause negative sentiment for new depositors on the chain.
Also worth noting that if a POOL drip is used to bootstrap the deployment, the minimum TVL projections listed above should be at least doubled to ensure there is some value going into przPOOL. Alternatively, the reserve shares can be increased to achieve a similar result with less TVL; however a long-term POOL drip would need to be committed to since the reserve shares can never be decreased once launched.