Proposal Details

Proposal #842

Failed

Proposal title

OSMO LST Support Re-evaluation: September 2024, stOSMO

Submit time

Deposit end time

Voting start time

Voting end time

Tally result

89.11%

Proposal #842 description

This proposal aims to further optimize the stOSMO liquidity held in the Osmosis community pool, maintaining the resilience of the stOSMO peg while reducing underlying liquidity and the OSMO staked by the community pool.

Current stOSMO liquidity

  • 9M OSMO in a stOSMO Stableswap pool, remaining from Proposal 641

    • 50/50 stOSMO/OSMO
  • 8.3M OSMO in a static Concentrated Liquidity position from Proposal 769

    • This position is from 1.2075 - 1.27, as the current market rate is 1.27 this is mostly OSMO and recently went out of position briefly.
  • 200k OSMO assigned to stOSMO as a trial Locust vault deployment in Proposal 798

Proposed actions

Transfer all stOSMO stableswap liquidity, stOSMO concentrated liquidity, and liquid stOSMO to the Osmosis Liquidity subDAO to perform the following actions

  • Remove all protocol liquidity from the stableswap pool.
    • This should be performed incrementally if the existing concentrated liquidity position is out of range during this action.
  • Create a new stOSMO position of 1.24 - 1.3 in the 0.05% pool using the newly available liquidity.
    • This position will initially be 50% stOSMO and 50% OSMO.
    • This position will last approximately three months before it becomes entirely OSMO through the redemption rate increase, closing the Osmosis community pool’s static holdings of Staked OSMO via Stride.
  • Remove the 1.2075 - 1.27 position from the concentrated liquidity pool
  • Transfer 700k OSMO and any excess stOSMO from fee collection into the Locust vault for stOSMO/OSMO as previously used in Proposal 798.
  • Transfer the remaining OSMO, the vault representing tokens, and the static position ownership to the community pool.

stOSMO Liquidity after proposal

  • OSMO assigned to stOSMO support lowered from 17.5 million to 10 million.
    • The stOSMO peg performed very well during recent volatility. The initial 20 million OSMO liquidity was assigned when Stableswap pools were the only option for deployment.
  • Liquidity depth remains similar due to increased overall concentration.
    • Static positions perform approximately 10x better than stableswap pools
    • Locust vaults have trended towards holding a narrower position in a mostly single sided position and perform approximately 30x better than stableswap pools.
  • Osmosis community pool holdings of stOSMO will be removed through arbitrage over three months.
    • This reduces staked OSMO held by the community pool to a minimal amount depending on the liquidity usage. If stOSMO loses peg, more is staked until arbitraged back. If the market rate is close to the redemption rate, then stakers are undiluted.

Forum Thread: https://forum.osmosis.zone/t/osmo-lst-support-re-evaluation-september-2024/3113

Proposal #842 overview

Total votes
6,787
Voters
6,773
Total deposit
1,600 OSMO

Proposal #842 votes

#

Validator

Account Address

Options
1#decentralizehk - DHK daoYes
2StakecitoYes
3Stakewolle.com |100% InsuranceYes
4CroutonDigitalYes
5KahunaYes
6Nocturnal LabsYes
7coinhall.orgYes
8DELIGHTYes
9TessellatedYes
10Binary BuildersYes
11ForboleYes
12Swiss StakingYes
13Silk NodesYes
14ProvalidatorYes
150base.vcYes
16DAO DAOAbstain
17ChainLayerAbstain
18Bro_n_BroYes
19ValidatusYes
20AllnodesYes
21QuebecYes
22Mad ScientistsYes
23StakeflowYes
24Informal SystemsYes
25KleomedesAbstain
26S16 Research VenturesYes
27DSRVYes
2801nodeYes
29OldcatYes
30NansenAbstain
31NosNode🔮Yes
32Booga BerasYes
33NodeStakeYes
34Citadel.oneYes
35EverstakeYes
36KalpaTechYes
37ElectricYes
38KomikuriYes
39White WhaleYes
40CryptoCrew Validators ✅Abstain
41blockscapeYes
42Chorus OneYes
43Crypto AssassinYes
44ZKVYes
45InteropYes
46Trust NodesAbstain
47WhisperNode 🤐Yes
48GATA HUBYes
49ObiYes
50FreshSTAKINGYes
51Lavender.Five Nodes 🐝Yes
52ECO Stake 🌱Yes
53Oni ⛩️Yes
54HFA X Defi DojoYes
55strangeloveYes
56Stake&Relax 🦥Yes
57PRO DelegatorsYes
58POSTHUMAN 🧬 StakeDropYes
59SpectrumXYes
60Active NodesYes
61Stakely.ioYes
62in3s.comYes
63Frens (🤝,🤝)Yes
64Node GuardiansYes
65MeriaYes
66Cypher CoreYes
67Kalia NetworkYes
68KeplrYes
69The_CyberneticsYes
70Interstellar Lounge 🍸Yes
71MendelYes
72CosmostationYes
73Smart Stake 📈📊Abstain
74PoS NodeAbstain
75Imperator.coAbstain
76Leonoor's CryptomanYes
77polkachu.comYes
78ChihuahuaYes
79vido.infoYes
80Margined ProtocolYes
81Chill ValidationYes
82AutoStake 🛡️ Slash ProtectedYes
83Uncle EdYes
84CommunityStakingAbstain
85CryptoDungeonYes

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