This proposal has also been cross-posted on the Keep forum here. Feel free to engage on both posts with both communities!
Rc0 T Proposal builds on the T6 Token Proposal by identifying the approach the communities can take to upgrade NuCypher and Keep to the (codename) Keanu network. We are looking for community feedback before submitting the proposal for snapshot votes in both DAOs. If the votes pass, both protocol teams will proceed with the implementation.
This proposal continues to be championed by Ben Longstaff and Viktor Bunin, but there are many folks that worked to make this proposal possible, including MacLane and Matt on the accounting and legal discussions.
We are proposing a modification and simplification of T6 Approach 2 from the previous proposal. The new proposed wrapping approach has been analyzed by third party experts from an accounting and legal perspective and we believe it is the best way to implement the hard merge upgrade.
We are considering this the final vote on Keanu. Anything not covered here, such as the exact inflation model, is considered an implementation detail and will be decided on by the community in future votes.
- The NuCypher and Keep collaboration will be implemented as a network upgrade
- “No token left behind.” Whether staking, LPing, or simply holding, all holders will have an equal opportunity to participate on the same terms without being punished for upgrading “late”
- Inflation in NU and KEEP will be suspended by respective DAO votes and replaced by inflation in T
- Post-upgrade governance decisions related to the Keanu DAO treasury and functioning of the Keanu network are not part of this proposal
Upgrading from NU and KEEP to T
The initial supply of T is 10 billion:
- 45% available to existing NU holders
- 45% available to existing KEEP holders
- 10% allocated to the Keanu DAO
To upgrade to T, token holders must wrap their existing NU and/or KEEP tokens in a smart contract. The rate (aka Token Factors) at which T is received for wrapping NU or KEEP depends on the total allocated supply of both tokens. This allows us to maintain an equal split between each network’s stakeholders. See below for an example.
Reminder - the data above is for illustrative purposes only of how the Token Factor would work. These are not real numbers. The end result is that both sides would get the same share of the network!
In order to fix the Token Factors, NuCypher and Keep communities will both vote via their respective DAOs to suspend ongoing inflation in the existing networks.
The upgrade wrapper contract will be perpetually accessible and enable NU and KEEP token holders to join the Keanu network without needing to buy or sell any assets. Existing NU and KEEP stakers will be able to stake in the Keanu network via adapters and earn T rewards until such time as their staked tokens become liquid and they can explicitly upgrade to T.
Wrapped T can be unwrapped back to the underlying NU or KEEP, but only from the same address (i.e. unwrapping is not fungible).
The upgrade process makes sense because it is very similar to how software is usually upgraded, like iPhone software upgrades. Anyone with that software is welcome to stay on the old version, but if you do decide to upgrade, you’re not getting a new iPhone. Network participants are welcome to remain on NuCypher or Keep, but if they would like to upgrade to Keanu, they are always welcome to do so with no penalty or obligations. If at any point they would like to downgrade to a previous version of the software, they are welcome to do that as well.
This upgrade mechanism is what will be voted on in the upcoming snapshot votes on both networks. Along with this proposal we are proposing a vote structure with three options for this final community snapshot:
- rc0 T proposal
- I prefer a different proposal
- No option / back to the drawing board
Rc0 T proposal is the focused proposal in this vote because it includes the best aspects of the previous community proposals that surfaced after many rounds of community discussion. Furthermore, both teams were able to confirm dynamics of rc0 T with third party legal and tax consultation. Putting all proposals up in this final vote would require extensive third party vetting of each individual proposal which would require more resources and delay this process even further. However, we are proposing this vote structure because it does not leave other community proposals behind. It gives both communities the chance to signal that rc0 T is not the prefered proposal and that an alternate proposal is better.
To move quickly, we are designating the exact inflationary model as an implementation detail. The inflationary model outlined in T6 is still the current proposal, but we will continue to discuss it and alternative inflationary models as a community. The inflationary model will be finalized (along with Keanu DAO dynamics) in future votes.
Roadmap & Timeline
- NuCypher and Keep communities vote on this proposal [snapshot links will be added soon] - June
- Determine DAO governance and inflation for the upgraded network - June
- Finish implementation - July
- Launch the upgraded network - August
- Launch tBTC v2 - September