Summary
The objective of this proposal is threefold:
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Governance Handover - Begin the transition of Mars Outpost governance away from signal voting towards full Mars Hub DAO control. Initially this will involve handing over the ownership and admin of the Params and Oracle contract to Mars Hub governance (which are the primary contracts responsible for asset listings and configurations).
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Risk Management DAO - Introduce a new Risk Management DAO to be granted special privileges on updating asset and perp market configs without going through the full governance process (excluding liquidation thresholds and new asset/perps listings which will need to still go through full governance).
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Deploying Perps - Deploy a new version of the Mars Outpost on Neutron that contains the Perps feature set. Following this Mars governance can decide to list new perps markets enabling perp trading alongside existing features on Mars’ Neutron outpost.
Motivation
- Governance Handover - Mars is undergoing a governance and tokenomics revamp, part of this involves moving its governance hub from the Mars Hub app chain to a DAODAO instance on Neutron.
Handing over owner and admin roles from a builders multisig to the DAODAO Mars Hub instance marks a major milestone in protocol decentralisation. This proposal is limited to doing so for the Params and Oracle contracts. These two contracts are the primary contracts involved in setting prices sources and market parameters for new and existing assets/perps markets on Mars Protocol - and so makes a perfect candidate for the first step in handing over ownership.
Following the successful handover of the Params and Oracle contracts, further proposals will be posted to move the remaining contracts over to the DAODAO instance.
- Risk Management DAO - Another part of the governance revamp, the Risk Management DAO is a new special permission role introduced in the Params contract.
Previously asset updates as a result of changing market conditions have been cumbersome requiring the full governance process of posting the proposal on the Mars forum to receive feedback before going to vote.
The introduction of the Risk Management DAO aims to strike a balance between still requiring governance for things that can immediately impact the protocol or user (e.g. listing assets or changing liq. thresholds) while allowing more dynamic updates of parameters like money market interest rate configurations and deposit caps, and perps market open interest, skew, and velocity configurations.
The main Mars Hub governance can at any point execute a governance proposal that can change or remove the Risk Manager role from the Params contract.
For a full list of what the Risk Management DAO can update see the implementation section below.
- Deploying Perps - Mars Protocol Foundation has been developing an innovative oracle based perps solution for over a year now that integrates into the Mars Credit Account allowing best in class capital efficiency and composability.
Following the successful incentivised testnet Mars Protocol Foundation have given the green light to unleash this powerful new primitive against the Mars Neutron Outpost.
Following the successful deployment of the perps codebase and the handover of the Params and Oracle contracts to the Mars Hub DAODAO instance, Mars governance will be able to propose and vote on listing new Perp markets. Mars Protocol Foundation intends to submit a follow up proposal listing BTC and ETH as the two initial markets.
Implementation
Release containing the Perps and Risk Manager features to be deployed:
Audits for Perps can be found here: https://github.com/mars-protocol/mars-audits/tree/main/core-contracts
This is a signaling proposal, not an executable proposal.
The Mars smart contracts on the Neutron chain are currently controlled by the Builder Multisig address. If this proposal passes, the builders will utilize their multisig to make the necessary changes.
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Governance Handover - the Params and Oracle contracts will have their admin and owner roles handed over to the Mars Hub DAODAO instance.
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The Risk Manager role on the Params contract will be set to the Mars Protocol Risk Management DAO which is a ⅗ multisig currently governed by core Mars Protocol contributors working under Mars Protocol Foundation
The Risk Manager role can currently update the following Credit Manager and Red Bank asset parameters:
max_loan_to_value
liquidation_bonus
protocol_liquidation_fee
deposit_cap
close_factor
And the following Credit Manager perps parameters:
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enabled
Whether the perp is enabled. -
max_net_oi_value
The maximum net open interest value (in oracle uusd denomination). -
max_long_oi_value
The maximum long open interest value (in oracle uusd denomination). -
max_short_oi_value
The maximum short open interest value (in oracle uusd denomination). -
closing_fee_rate
The fee paid by the user to close a position (as a percent). -
opening_fee_rate
The fee paid by the user to open a position (as a percent). -
min_position_value
The minimum value of a position (in oracle uusd denomination). -
max_position_value
The maximum value of a position (in oracle uusd denomination). -
max_loan_to_value
Max loan-to-position value for the position. -
max_funding_velocity
Determines the maximum rate at which funding can be adjusted. -
skew_scale
Determines the funding rate for a given level of skew. The lower the skew_scale, the higher the funding rate.
While the Risk Manager role is fulfilled by a Mars Protocol Foundation multisig, the Mars Protocol Foundation will act transparently, publicly reporting when any actions are carried out.
- The 2.2.0 Migration will be run from the release above to update the Mars Neutron Outpost contracts to include the Perps functionality.
Licensing Update
As part of the deployment, it’s important to note that the new version of Mars contracts has been released under a separate repository with an FSL license. The original GPL-3.0 licensed contracts remain available for use in their existing repository. This change reflects the evolution of the Mars Protocol codebase and ensures protection of the protocol’s latest features.
Copyright
Copyright and related rights waived via CC0.
Disclaimers/Disclosures
This proposal is being made by Mars Protocol Foundation, a Cayman Islands foundation company. Mars Protocol Foundation engages in research and development of the Mars Protocol. Mars Protocol Foundation and certain of its service providers and managers own MARS tokens and have financial interests related to this proposal. The aforementioned persons or their affiliates may also have financial interests in complementary or competing projects or ecosystems, entities or tokens, including Neutron/NTRN. These statements are intended to disclose relevant facts and to help identify potential conflicts of interest, and should not be misconstrued as a complete description of all relevant interests or conflicts of interests; nor should they be construed as a recommendation to purchase or acquire any token or security.
This proposal is also subject to and qualified by the Mars Disclaimers/Disclosures. Mars Protocol Foundation may lack access to all relevant facts or may have failed to give appropriate weighting to available facts. Mars Protocol Foundation is not making any representation, warranty or guarantee regarding the accuracy or completeness of the statements herein, and Mars Protocol Foundation shall have no liability in the event of losses or damages ensuing from approval or rejection or other handling of the proposal. Each user and voter should undertake their own research and make their own independent interpretation and analysis of all relevant facts and issues to arrive at their own personal determinations of how to vote on the proposal.
