• Proposal

  • OIP-144: Additional Actions to Take for Clearinghouse Loans

Background: This proposal was created in response to Launch an Operator-Free Cooler Loan Clearinghouse posted May 24 and its associated TAP: TAP-25 - Cooler Loan Clearinghouse posted June 1. The RFC for this proposal can be found here.

Change list from RFC:

  • Removed the fourth point about consolidating the Treasury as there is not enough consensus yet into how much to consolidate. The Treasury team should create a TAP to cover this.
  • Updated the third point on RBS target price to include some logic around backing.
  • Removed annualized interest rate from the list of framework-enforced terms. Capacity and LTV terms remain as standard values for future clearinghouses.

Proposal:

This is a suite of potential actions to take as part of Clearinghouse loan preparation. The following additional actions are proposed here as supporting measures for Cooler Loans. Each action listed here, if approved through the forums, would be a separate Snapshot vote.

OIP-144A: Implement Cooler Loans with capacity following three possible rollout schedules to be voted on:

  • Vote Option 1 (fastest deployment):

    • Launch: 10M DAI
    • Launch + 1 week: 33M DAI ← stop here if voted on
    • Launch + 2 weeks: 69M DAI ← stop here if voted on
    • Launch + 1 month: unlimited capacity ← stop here if voted on

  • Vote Option 2 (medium speed):

    • Launch: 10M DAI

    • Launch + 1 month: 33M DAI ← stop here if voted on

    • Launch + 2 months: 69M DAI ← stop here if voted on

    • Launch + 3 months: unlimited capacity ← stop here if voted on

  • Vote Option 3 (slowest deployment):

    • Launch: 10M DAI

    • Launch + 1 month: 33M DAI ← stop here if voted on

    • Launch + 3 months: 69M DAI ← stop here if voted on

    • Launch + 6 months: unlimited capacity ← stop here if voted on

OIP-144B: Complete the OHMv1 → OHMv2 migration, which started in December 2021. Give 3 month’s warning from the date of Snapshot vote closure to implement the migration stop procedure:

  1. If passed, send notification to Ohmies on v1 that migration will soon close

  2. Give Ohmies on v1 three months to migrate

  3. After 3 months (somewhere around 8 September 2023), close migration by pulling gOHM out of the migrator

  4. Vote Option 1: Approve migration completion procedure

  5. Vote Option 2: Reject migration completion procedure

OIP-144C: Change RBS minimumPriceTarget value according to the following formula. Make it the lesser of:

  1. (1 + RBScushionSpread) x (coolerLTV) x 1.02
  2. Backing

Example: if RBS cushion spread is 7.5% and the LTV is voted to be $2,850 ($10.67 in OHM terms), then minimumPriceTarget should be changed to (1+0.075) x ($10.67) x 1.02 = $11.699

The 2% buffer on top exists to provide relevant optionality between taking the lower cushion and taking a Cooler loan

  • Vote Option 1: Approve minimumPriceTarget logic change
  • Vote Option 2: Reject minimumPriceTarget logic change

OIP-144D: Enforce voted-on terms in TAP-25 to be applicable to all clearinghouses:

  1. Loan-to-collateral

  2. Capacity

  3. Vote Option 1: approve framework for future clearinghouses

  4. Vote Option 2: reject framework for future clearinghouses

Motivations:

  1. Launching with limited capacity helps mitigate the impact of issues that may arise in the Clearinghouse functionality. As the code is used more in production, confidence in its continued good functioning increases. Increased capacity can follow that. An aggressive timeline is good for allowing more OHM to flow in faster and process whatever pent-up demand exists for this product. One tradeoff is security; implementing too quickly can leave too much capital exposed to a new contract which hasn’t seen full-scale production use.

  2. The v2 migration continues to be a pain point for accurate supply calculation. A key aspect of Cooler Loans is that they are non-liquidatable based on backing, and shifting supply makes the actual backing of OHM less certain. Since the start of 2023, less than 600 gOHM has been migrated, with amounts significantly trailing off since March. After 18 months of migration, it’s time to finally close the OHMv1 chapter. Migration can be closed in the following manner:

    1. If passed, send notification to Ohmies on v1 that migration will soon close

    2. Give Ohmies on v1 three months to migrate

    3. After 3 months (somewhere around 8 September 2023), close migration by pulling gOHM out of the migrator

  3. Cooler Loans should exist somewhere below the lower cushion offered by RBS. RBS lower cushion sitting below Cooler Loans basically eliminates any use case for lower RBS. This is especially true at higher Cooler Loans capacities. A positive spread between the RBS lower cushion and Cooler Loans value allows for RBS to continue to work as intended, capturing some outflows while also giving users the option to take out a loan at a reasonable spread. Specifically, a 2% spread between the two helps lower the risk of defaults in the case that price rides the lower cushion when it’s time to pay the loan back.

  4. This proposal can serve as a framework for further clearinghouse proposals. The term length and interest rate are specifically omitted from the framework as it becomes interesting to allow for different parameters to arise from different clearinghouses.

Next Steps:

  1. The execution OIP is contingent on Cooler Loans Snapshot passing.

  2. Reduce liquidity at the same time (already approved, does not need a vote) This is complete

  3. Move RBS target price as voted on here

  4. Launch Cooler Loans

  5. Complete OHMv2 migration as laid out in this proposal

Poll: should these four votes be sent to Snapshot?

Should these four votes be sent to Snapshot?

This poll has ended.
  • z_33 replied to this.

    All for v1 end-of-life.

    But aside from other objections to Cooler - we cannot bake this into RBS:

    1. (1 + RBScushionSpread) x (coolerLTV) x 1.02

    Cooler is a 3rd party platform (albeit developed by a former council member) - it cannot be either philosophically or functionally baked into core protocol functions. (In the same way OHM bonds were -not- called "bond protocol bonds")

    This can be improved by a change of nomenclature however, rename "coolerLTV" in calculations to something platform agnostic e.g. BaseLoanRate or whatever. It's important for positioning and perception.

      thomasscovell makes sense and to be clear, this logic isn't coded into the RBS v1.1 contract. We manage the change in target price via Policy MS for the time being. When V2 rolls around it's a great idea to keep the nomenclature platform agnostic as you say.

          17 days later

          abipup

          re 144B. imo we shouldn't be potentially rugging up to $8million worth of value from token holders based on arbitrary post-hoc decided migration timeline. No matter how dormant, that capital belongs to those token holders. We should either formalize this tracking and add it to code, and if that's too much of a headache, worse case scenario should be to send equivalent amount of backing to those token holders and then shutdown migration.

              z_33 there has to be a migration deadline, and it's no different really to rebasing the value away from those who are dormant - should we go back and 'unrebase' all the value back to people who are unable/unwilling to engage with staking? Everybody else has hard deadlines for migrations, and we've given more than adequate time here already. Carrying around the administrative burden of this hinders contributors' efficiency, and also hinders the ability to concisely explain the current standing to potential adopters of OHM. This hard line in the sand is necessary.

              The idea of airdropping backing to people is absurd. Why should the least engaged people be able to access full backing, while others are 'only' able to access 90/95% via CL? Add to this the fact that a large portion of the airdropped value would sit similarly idle in these forgotten/lost addresses. This idea should be a non-starter.

              The most appropriate course of action for $8million is the one chosen by governance. Anything else would carry a significant execution risk for those carrying it out; imposing their own moral standing on such a large sum of money without the authority of governance. Governance bears responsibility for its actions for this very reason. You can express your views and moral standing via your voting power, that's how the system works.

              • z_33 replied to this.

                  alinew there has to be a migration deadline, and it's no different really to rebasing the value away from those who are dormant - should we go back and 'unrebase' all the value back to people who are unable/unwilling to engage with staking?

                  Migration tracks index. OHMv1 is considered "staked" from the day v2 was launched. So we haven't been "rebasing the value away" for people who didn't migrate. In fact, we explicitly told them that there's no rush to migrate as they won't lose any rebases.

                  if you're talking about people who bought OHM but never staked, that's completely a different issue. Staking incentives are publicly and very clearly communicated the whole time. Migration was not communicated as a time limited event at any point.

                  alinew The idea of airdropping backing to people is absurd. Why should the least engaged people be able to access full backing, while others are 'only' able to access 90/95% via CL? Add to this the fact that a large portion of the airdropped value would sit similarly idle in these forgotten/lost addresses. This idea should be a non-starter.

                  no need to airdrop 100%, airdrop them the same as cooler loan LTV. Or just lock it in a claim contract that they can access

                  alinew The most appropriate course of action for $8million is the one chosen by governance. Anything else would carry a significant execution risk for those carrying it out; imposing their own moral standing on such a large sum of money without the authority of governance. Governance bears responsibility for its actions for this very reason. You can express your views and moral standing via your voting power, that's how the system works.

                  asking people whether they want money stolen from others or not is not a fair vote.

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