Tech. Comm. #150

#150·Ratify Criteria for Listing a Token in the Omnipool

Democracy

5mos ago

5 Comments

Executed

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I have drafted some guidelines for future Omnipool token listings. We've discussed these in Council, received positive feedback here and am now putting them to Hydration governance vote to ratify.

easy to read version: https://github.com/spazcoin/HydraDX-docs/blob/howToListInOmnipool/docs/howto_list_token_in_omnipool.md
you can post comments here or directly on the PR: https://github.com/galacticcouncil/HydraDX-docs/pull/189

the most important bit is:

00 Prerequisites

With all tokens pooled into a single pool, we must take extra precautions to avoid exposing the Omnipool to large swings in token values due to market manipulation. Therefore the requirements for listing a token in the Omnipool are:

The token must have already gone through price discovery for at least eight months. Must be listed on a DEX with at least $100k liquidity and/or listed on a CEX with active market maker support maintaining a 2% depth of at least $2k. Ideally the token is listed on at least two exchanges.

Sudo control of the chain/token must have been removed or revoked. This could involve the removal of the sudo pallet entirely, removing a registered sudo key, or in the case of AssetHub tokens the provable burning of any administrative control over the token.

The project must have active token holder governance. Ideally through the use of OpenGov. We recommend setting up automated governance notifications (such as web3alerts) to mitigate governance attacks.

The project must have transparent market data available, including the ability to inspect transactions via a block explorer.

The token must be sufficiently distributed to avoid individuals causing large price swings. At least 40% of the token supply must be distributed and in circulation.

The token must have a market cap of at least $1M.

There may be exceptions, or additional criteria preventing a token from being listed in the Omnipool since it is difficult to define absolute rules that apply in all situations. HydraDX token holders will vote on each application to list a token in the Omnipool.

and

How much initial liquidity?

For tokens with an FDV up to $50M, the minimum team/treasury deposit into the Omnipool is $300k worth of tokens.

For tokens with an FDV above $50M, the minimum team/treasury deposit into the Omnipool is $500k worth of tokens.

Each community should consider depositing additional tokens later to bring the deposit up to $1M or up to 2.5% of FDV, in line with other community deposits. Hydra's DCA feature allows swaps to be spread out, enabling larger trades over time, but loan liquidations need to happen within a single block and therefore deeper token liquidity enables larger money markets for the token.

These proposed Omnipool listing requirements have nothing to do with currently discussed listings, but instead are my attempt to make the process more predictable for future teams by explicitly defining listing requirements based on the informal criteria that Hydra team/council/community have already been using. I've also proposed larger minimum deposits in line with the 2nd round of deposits that I'm currently coordinating.

specifically:

this has nothing to do with current Darwinia process of listing. Althought the guidelines require a larger initial deposit than Darwinia governance has already authorized, I would propose Hydra governance grandfather them in.
We did discuss that MYTH has not revoked sudo but @lolmcshizz explained that "their sudo is behind a council/ foundation of doxxed individuals with a legal mandate". So again, that's up to community vote when the time comes.

Edited

Votes4/4

Aye

Aye

Aye

Aye

This vote has been closed.

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Comments

7P8m...7MHQ

I think with these criteria you would be excluding ZTG, which is one of your best tokens to keep atm :(
I would like to see more formulas instead of only 2 arbitrary thresholds (eg. for the liquidity).

Also, what do you mean with "that's up to community vote when the time comes.", aren't we defining the terms now? If Governance can decide, can it also override the terms each time? Shouldn't the rules be flexible enough so that everything is coherent?

Edited

7PAU...Zqrk

Need to add terms involving the centralization of the token supply. We don't want one party being capable of making massive price swings by manipulating votes. Believe that would have negative implications for the Omnipool if a token hyperinflates or hyperdeflates , suddenly, from the founders or a large investment firm voting to manipulate price and profits either on a long or short in the process

7PAU...Zqrk

Should be token per token for this. It's possible for different tokens to have different rules on quorums and super majorities for getting referendums to pass. But, we still need general rules so no one party controls the vote.

7Nu7...PBG1

In principle, the proposal is good, but similar to CEXs, there should be a monetary cost for listing. This cost should be used to buy HDX and burn them. Maybe in the near future?

7Nru...rgez

@7P8m...7MHQ

you would be excluding ZTG

Please read the entire document here: https://github.com/spazcoin/HydraDX-docs/blob/howToListInOmnipool/docs/howto_list_token_in_omnipool.md

Zeitgeist is already in the Omnipool. These rules only apply to new listings.
The document says:

Each community should consider depositing additional tokens later to bring the deposit up to $1M or up to 2.5% of FDV, in line with other community deposits.

I came up with that 2.5% FDV threshold specifically because of ZTG. It has a smaller market cap and for smaller cap (but long term stable) tokens it's not reasonalbe to put $500k or $1M of their token into the Omnipool.

@7PAU...Zqrk

It's possible for different tokens to have different rules on quorums and super majorities for getting referendums to pass.

Agreed, that's why these listing rules/guidelines say that ultimately it's up to Hydration community governance vote to decide whether a token can be listed.

@7PAU...Zqrk

Need to add terms involving the centralization of the token supply.

Agreed. We debated this for a while, but there was no easy way to define this because of course whales can split their tokens up across multiple accounts. That's why we settled back to the "40% in circulation" being sufficient to cover this case. And so everyone knows - foundation, treasury, and locked/vesting tokens are not "in circulation".