Connect with us

Market

SushiSwap’s Protocol Can’t Easily Deliver Policy Changes

Published

on


  • The SushiSwap community has voted on policy changes to the protocol to reduce the token reward schedule, introduce a lock-up period for newly minted Sushi, and introduce fee staking. But these changes can’t be made without first migrating to new smart contracts, a research firm told CoinDesk.
  • The current MasterChef contract doesn’t permit changes to the SushiToken contract, which in turn dictates other protocol functions for minting SUSHI tokens and for paying fee-staking rewards to SushiSwap holders.
  • Each smart contract would have to be manually migrated to make the changes, the research firm claims, though the SushiSwap team is looking for workarounds that don’t require as much heavy lifting.

The SushiSwap smart contract migration is complete but there’s a problem: Another migration may be needed if the team wants to implement changes to the protocol the SushiSwap community voted for.

Limitations in SushiSwap’s code make the proposed changes impossible without serious alterations to SushiSwap’s code, namely another migration, blockchain research firm IntoTheBlock told CoinDesk. 

The SushiSwap community just voted to decrease the Sushi token reward – a so-called liquidity provider (LP) token which is rewarded to sushi users who stake tokens in SushiSwap’s liquidity pools – from 100 SUSHI per block to 50, with successive halvings every two years. In addition, this change would include a “vesting” mechanism whereby two thirds of all newly minted SUSHI are locked for one year.

These vested tokens would earn transaction fees but could not be moved or used in voting until the year-long timelock expires. The vesting proposal is particularly germane to this project after its progenitor, Chef Nomi, sold off $13 million worth SUSHI tokens for ether last weekend. Chef Nomi recently forfeited this fortune, though, announcing on Twitter that he sent the 37,400 ether he garnered from trading in his SUSHI tokens to the SushiSwap treasury.

Read more: ‘I F**ked Up’: SushiSwap Creator Chef Nomi Returns $14M Dev Fund

Sushi unrolled

These proposals won a landslide majority vote among the community, but IntoTheBlock told CoinDesk SushiSwap’s current smart contracts aren’t flexible enough to bend the rules of the protocol.

The MasterChef contract, for instance, doesn’t allow for the reward schedule to be altered because the emission rate is “hard coded.”

“…[T]he current version of the MasterChef smart contract has hard coded the number of SUSHI tokens per block that can be awarded. This has been done via the sushiPerBlock variable which is initialized at a value of 100 at the contract creation time and can’t be modified after that. You can see the reference in line 96 of the MasterChef smart contract. In simpler terms, changing the value of the sushiPerBlock variable would require deploying a new smart contract,” reads an IntoTheBlock research document shared with CoinDesk.

Read more: SushiSwap Will Withdraw Up to $830M From Uniswap Today: Why It Matters for DeFi

Fortunately, there is actually a fix for this limitation that doesn’t require another migration: Even if the reward is hard-capped, it’s possible to send extra rewards to a dead-end address that no one has access to (thus, to decrease rewards from 100 SUSHI to 50 SUSHI, every block reward would send 50 of the 100 SUSHI minted to this dead-end address).

“Although clever, this option is far from elegant and falls outside the original design of the SushiSwap protocol,” the report reads.

The great migration: What this would mean

More than inelegant, fixing the other limitations would require an overhaul of SushiSwap’s smart contracts entirely.  The problem stems from a design choice wherein the MasterChef contract (which has control over the protocol) is not upgradeable and actually owns the SushiToken contract, so migrating to a new MasterChef contract (e.g., MasterChefV2) would also require deploying a new SushiToken contract (SushiTokenV2), according to IntoTheBlock developer Pablo Bianciotto.

“The limitation arises from the fact that MasterChef is not upgradeable,” he told CoinDesk. “To be upgradeable, the actual contract logic should be stored in another contract which is referenced by MasterChef. That would give you the flexibility to change minting/rewards distribution logic by replacing this secondary contract for a new one and updating MasterChef reference.

“In addition to that, SushiToken is owned by MasterChef, so creating a new MasterChef V2 contract with a new reward distribution logic and upgradeable features would require migrating the SushiToken contract, too.” 

To implement vesting, for example, would require a MasterChefV2 and a SushiTokenV2 Bianciotto said.

Read more: Fishy Business: What Happened to $1.2B DeFi Protocol SushiSwap Over the Weekend

The code’s limitation would also interfere with implementing the fee payout proposal because there’s no way to transfer the vested tokens from the MasterChef contract into another contract for fee staking.

“This part is even harder to do,” Bianciotto said. “To earn fee payments you have to stake SUSHI into the SushiBar contract, but if your SUSHI rewarded for staking is vested and sitting in MasterChef, you wouldn’t be able to transfer it from MasterChef to SushiBar to earn fee payments.” He added that a SushiBarV2 would need to be spun up to accommodate this change, as well as a new SUSHI token minting contract (SushiMakerV2).

A cascade effect

In effect, the MasterChef contract’s non-upgradeable nature creates a cascading effect wherein every smart contract under its control also requires an upgrade to make the proposed changes to the protocol. The only solution, then, involves migrating each smart contract to a completely new version.

Seeing as each contract would need to be redeployed, this migration process would be more labor intensive than the previous one. Fully migrating each smart contract would involved taking a snapshot of all user’s balances and airdropping new tokens after the new contracts are deployed, as well as migrating individual user data from all of SushiSwap’s liquidity pools; users would also have to unstake all SUSHI tokens in the SushiBar and in SUSHI/ETH staking pools prior to the snapshot.

Biaciotto said that while the snapshot and airdrop may seem simple for user addresses, “smart contracts that rely on SushiToken could stop working unless they are upgraded to use the new SushiTokenV2.”

He also noted there “are no time constraints” for these changes. He recommended a transparent and methodical migration that also “clears the way to seamlessly adding/changing protocol features in the future” to avoid having to implement further changes through another migration.

Community response

CoinDesk reached out to SushiSwap’s newly elected leadership (those members who hold one of nine multisignature keys to dictate protocol development) to ask if they are planning another migration.

“No migration in the short term,” responded 0xMaki, the lead developer of SushiSwap, who has been with the project from the start. 0xMaki continued that they wish to implement the vesting and fee-staking proposals but that “it will require more thinking” to pull off. 

Bianciotto, though, insisted the “the only way forward [to implement these proposals] seems to be doing a migration.”

Read more: SushiSwap Migration Ushers in Era of ‘Protocol Politicians’

Another team member insisted that such a migration would be “significantly less complicated” and that there is “no concern whatsoever of any problems on the horizon.” Bianciotto reaffirmed that since “SUSHI is owned by MasterChef,” that “any kind of migration is non-trivial.”

To corroborate IntoTheBlock’s research, CoinDesk reached out to Zokyo Labs, a blockchain security and development company with a DeFi studio. A Zokyo representative confirmed IntoTheBlock’s findings.   



Source link

Market

Grayscale’s AUM Hits $19B, Up from $16.4B Announced Week Ago

Published

on

By


While it may be too early to project the possible performance of Grayscale in 2021, the spate of patronage the company recorded in the last two quarters of 2020 looks quite inspiring.

In what confirms the continued embrace of Bitcoin (BTC) and altcoins by institutional investors and the big-money clients, Grayscale’s total Assets Under Management (AUM) has been reported to top $19 billion, a significant uplift from the $16.4 billion reported a week ago. According to a report by CoinDesk, Grayscale hit this AUM milestone on December 28, and Grayscale’s Bitcoin Trust holds by far the largest chunk of the total assets at $16.3 billion.

The recent rally of Bitcoin to new highs as recorded in the past days started as a chain reaction that took its precedent months ago when Wall Street firms and institutional investors began betting big on Bitcoin. The investment made by the likes of MicroStrategy Incorporated (NASDAQ: MSTR), Square Inc (NYSE: SQ), and PayPal Holdings Inc (NASDAQ: PYPL) did not just help put Bitcoin in the limelight through mainstream media, it also prompted the embrace of the digital assets by other firms.

With this chain reaction, the price of Bitcoin continued to soar in response to boosted demand for the coin, and institutions like Grayscale that serves institutional investors benefited from this new demand, and hence, the continued increase in the firm’s AUM. Besides BTC, Grayscale’s Ethereum (ETH) AUM is now worth $2.1 billion, while the bulk of smaller holdings in Litecoin (LTC), XRP, and ZCash amongst others helped Grayscale’s total AUM to reach the new milestone.

Grayscale’s AUM May See More Boost in 2021

While it may be too early to project the possible performance of Grayscale in the coming year 2021, the spate of patronage the company recorded in the last two quarters of 2020 makes the case for improved performance provided the tempo is sustained.

Just as has been noted earlier, the continued embrace of cryptocurrency assets by highly liquid companies will continue to have a positive reaction on the price of Bitcoin, and by extension, this will even make more people pick interest in BTC. As a relatively young asset class, Bitcoin and altcoins have tremendous room to grow as the adoption rate is still not optimized owing to certain regulatory provisions in most countries, Grayscale and other hedge funds have enough room to compete for new clients entering the space.

With Grayscale been among the institutions at the forefront of helping to drive the acceptance of BTC, ETH, and other digital currencies, enjoying the dividends of its works through impressed AUM figures does not come as much of a surprise.

next Altcoin News, Bitcoin News, Cryptocurrency news, News

Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.





Source link

Continue Reading

Market

eToro Said to Be in Talks With Goldman About Possible $5B IPO: Report

Published

on

By



The crypto trading/investment management platform is also considering the possibility of a merger with a special purpose acquisition company.



Source link

Continue Reading

Market

Altcoin Rally Dimming Bitcoin’s Shine, Polkadot Gains 34% in One Week

Published

on

By


Polkadot (DOT) saw daily gains of 22.5% wrapping up an impressive week with an almost 34% rise in its value.

Bitcoin bullish run looks to have come to a halt amidst an altcoin rally which has seen relatively lower coins put up impressive performances in the past few weeks. Bitcoin dominance is gradually fading as many experts believe the biggest digital coin is backing down as some top altcoin are showing strong “moves” or signals. 

Bitcoin hit an all-time high over the weekend, the third time its price has done so in just over 2 months. The price of the biggest digital coin touched $28,400 on December 27, before a lightning drop took it to $27,000 just hours of that incredible feat. 

Bitcoin failed to hold onto the $27,000 mark as its price further dropped to $26,000 a day after and is now testing lower levels centered on $26,000 as immediate support. Reports from crypto exchanges revealed BTC/USD trading at lows of $25,830 during the early hours of December 29. 

While Bitcoin has seen red over a couple of days, some altcoins are putting up impressive numbers, giving off signals of a strong altcoin rally. Despite XRP’s current issues, the altcoin market is showing glimpses of its glory days as some digital coins are poised to see major gains over the next couple of weeks. Ethereum (ETH) is at the forefront of the rally, with its price climbing above $700 for the first time since May 2018. 

Polkadot (DOT) also saw daily gains of 22.5% wrapping up an impressive week with an almost 34% rise in its value. The coin is now the seventh-largest token by market cap. Kusama (KSM), a cousin of Polkadot, also saw its price gain 46% last week, pushing its price from $43.1 to $63. The digital token is currently trading at $56 but experts are adamant a breakout above $65 is possible as the token has rebounded off the 20-day exponential moving average ($50.90)

Speaking on the possibility of a long term altcoin rally, analyst Van de Poppe stated that altcoins are next in line to see greens. He added that the next “impulse wave” on Bitcoin next year should be able to take the market to $40,000 or $50,000, but until then, the possibility of a continuance altcoin rally is very much likely.

Although many factors could be in play with regards to the latest Bitcoin price dip, it’s recent fallout with Ripple’s XRP leads the way. Ripple was hit with a lawsuit from the United States Security and Exchange Commission (SEC) and subsequently suffered drops that left its price in a pit. XRP, the fourth-largest cryptocurrency by market cap, is now trading at $0.20 as news broke that Coinbase, a major US cryptocurrency exchange has decided to suspend its trading from next month.

next Altcoin News, Bitcoin News, Cryptocurrency news, News

Crypto fanatic, writer and researcher. Thinks that Blockchain is second to a digital camera on the list of greatest inventions.



Source link

Continue Reading

Trending