0xffaf6202…8d99sent to0x94b4fb16…d5f1·#18,413,962·view on Etherscan
TLDR: we're exploring additional protocol changes to better curb auction arb.
The burn code has recently been reviewed by soli, and the fixes won't take long. However, that's not our main focus these days.
The burn works in cycles that provide predictability, e.g. we can decide to burn every 100 Nouns. At the same time roughly 30 Nouns are required to initiate a fork given current adjusted supply and fork threshold. Assuming such parameters, arbers can safely perform up to 3 rounds of forking without being impacted by the burn. And after a burn occurs, they can continue to do so until the next burn and so on.
A naive reaction to this problem is to configure fork threshold and burn cycle such that we burn before there's a fork, e.g. raise fork threshold to require just over 60 Nouns, and set the burn cycle at 60 Nouns, and there you have it.
While this is certainly a possibility, there is a natural tension:
* We want to keep for threshold low, for multiple reasons such as wanting the fork to truly serve minority protection
* We want the burn cycle to be longer, to give the community sufficient time to coordinate funding
We are therefore exploring other designs, such as:
* Requiring a minimum age for a Noun to be allowed to escrow towards a fork
* Initiating a burn before any fork
Since such ideas have the potential to impact the burn design, we think it best to reach a decision before declaring the burn code to be final and submitting it for an audit. It might also be best to expand the audit scope to include whichever idea we land on, as they seem highly entangled, working together with the burn to achieve the arb mitigation we're aiming for.
Important to restate: we want to significantly curb arb such that auctions are once again onboarding new long term Nouns players.
What's next:
* We will publish a blog post detailing our thinking, and share it with the community.
* We will ask for feedback and help making a decision.
* We will then share an updated scope and timeline.
Thanks to everyone contributing to these conversations!