In our previous post, we introduced POND and MPond as the Marlin network’s staking and governance tokens. Shortly thereafter, POND was distributed amongst eggnet participants to kick off the Marlin economy. Similarly, MPond was sent out to private sale participants. But what do these tokens represent and how can they be used?
We’ll be taking you through different aspects of the Marlin protocol in this new series of articles. But before that, let’s quickly walk through the launch and the community behind Marlin for a quick background on the unique Marlin token model and how it relates to our future course of action.
The birth of a new token model
Our post on Marlin’s development trajectory spoke about how we envision the different stages of evolution of the Marlin network. An important milestone was pointed out to be the transition from the Eggnet to the Larvanet when the network started securing a quantifiable economic value. However, we couldn’t just release tokens to the public at large without a clue about the network’s staking requirements which don’t become completely apparent until the Frynet.
We proposed to solve this dichotomy by issuing transactional tokens (POND) to Eggnet participants who could then exchange these tokens with potential Larvanet participants. By making these tokens compatible with the tokens issued to private sale participants (MPond), we kick off the creation of an economy which will provide us insights to configure parameters for the Frynet without seemingly many irreversible consequences providing a very guarded environment.
This setup is uncannily similar to what some projects adopt with testnet tokens but is different in two major ways: (i) It allows private sale purchasers to start using their tokens beforehand instead of leaving them with paper SAFTs (ii) It doesn’t require testnet participants to swap their testnet tokens for a new mainnet token. The borders are blurred providing for an almost real and mature experience while still being sandboxed.
Moreover, here, POND is distributed as a reward for the time and effort spent by individuals and entities involving tiring and complex network stress-testing, performance competition, and other tasks instead of monetary compensation. This ensures tokens are distributed amongst a targeted technical community base while also making the process as fair as it can be.
It is worth remarking that we have received no complaints of favouritism or censorship. Anybody, anywhere was free to join the permissionless network (with the exception of following KYC procedures which was mandatory and considered to be a worthy and unavoidable tradeoff for the long term). There are a few claims, of course, which are being addressed openly.
0xSanta launches a Uniswap pool
With roughly 4.33% of the total supply distributed it was important to ensure that other potential Larvanet participants (the latecomers) would be able to enter the system. Thankfully, a few community members were a bit more DeFi-savvy. A day or two before distribution we started receiving enthusiastic inquiries to create liquidity pools. Some went ahead and created Twitter accounts in an attempt to catch some attention.
The team played along and provided as much support as it could. It was suggested we use Banteg’s seed-liquidity tool given uncertain interest in the liquidity pool. It seemed cool. It was unaudited. It was written a day prior. Seemed perfect for the DeFi-like community-focussed fair launch we were geared towards. We spent a day writing some rigorous tests and once deemed safe to use, a dedicated channel 0xsanta (based on the art by Nicole) was set up in Discord with those who were around as a way to add the initial liquidity from volunteers.
Since the tool didn’t work with non-virgin pools, the distribution had to be in sync with the contract being deployed. This required some coordination but it worked. Amongst the few members we were collaborating with, a POND-USDC liquidity pool went live! Unfortunately, the excitement was short-lived. As soon as we started sharing the contract addresses out, our naivety became apparent.
We missed the fact that there was an option to add one-sided liquidity. We could have been more inclusive than just the few members to receive POND that we were chatting with. OTOH, the virgin-pool requirement was still a limiting factor.
Pools become popular in the DeFi space, maybe it's the bots, maybe not. Either way, not realizing that, for one, made the usage of the tool not so important and worse so, not enough validators were ready to provide liquidity. Some were sleeping, some unavailable, some didn’t know how to use Uniswap and some others couldn’t figure if the tokens were real. Yet some others were asking us how to convert the POND to MPond in order to stake it.
Regardless, the task of distributing tokens to developers, nodes, and tech-savvy supporters is now complete. We managed the situation by working with OTC channels, ordering execution and within a few hours were listed by a number of centralized exchanges, including Huobi. We are a week away from the launch of the Larvanet where POND tokens along with MPond become usable as part of the staking process (more on that later). An important component of these phase transitions which ultimately also dictates how the onchain governed bridge would allow conversions between MPond and POND is the DAO.
Genesis of the DAO
The distribution of MPond and POND gives token holders the opportunity to start taking control of the protocol. The POND DAO uses the tried-and-tested Compound governance contracts with appropriate parameterization changes.
Below is a short description of how we expect POND governance to work:
Anyone can create a proposal on the #proposals channel of our Discord server and try to gauge interest amongst others. In short, it is the to-go place to informally discuss proposals.
Baked ideas can then be posted on our forum (with ‘governance’ tag) to have discussions around parameters, implementation etc, as the case may be.
Once finalized, the proposal can be added on-chain for a vote by anyone holding 1 MPond.
Once a vote is published on-chain, the proposal shall appear on https://app.marlin.pro. Voting shall remain open for a period of 3 days.
Each MPond in one’s wallet when the proposal was created represents 1 vote. If a proposal receives at least 200 For votes with the For votes being above 85% of the total number of votes, the proposal is Accepted subject to a review period of 4 days.
Most, if not all, Marlin contracts are proxy-upgradeable. A point worth noting is that as we experiment with ideas around illiquid governance only MPond holders have votes. This implies that POND holders are required to convert their tokens to MPond via the bridge before they get to vote to ensure resistance against malicious acquisition and quick disposal of power.
In effect, POND is not only a transactional value token, but also a minimized governance entry-token. With POND it is easier for smaller and new validators to onboard. Meanwhile, those who want to be more integral to Marlin network's future, can opt-in to convert to MPond and be part of POND DAO. That being said, you can get extra utility from POND with staking on the network. Both are to launch in the coming weeks, so there will be a lot of information coming on how to participate in both. Stay tuned!
The Marlin protocol is now beyond the team or even its private sale participants. The community of validators includes universities, professional staking companies, community pools running nodes for other chains, some projects and some venture capital funds too. They together supported the network by running over hundreds of nodes. Feel free to join this thriving community at https://discord.gg/DYYzbDbtGj.
For the curious mind, our staking docs are already available at https://www.marlin.pro/docs/staking/guide/ and contracts at https://github.com/marlinprotocol/Contracts/tree/master/contracts/Stake. The contracts have been audited by PeckShield and are readily usable. A frontend is on the works (teaser below). Our staking contracts allow staking LP tokens so if you are providing liquidity on Uniswap pools you will be eligible to stake the LP tokens in lieu of an equivalent number of POND. Moreover, staking LP tokens can have a higher yield as compared to staking POND :) And if that wasn’t exciting enough, since Marlin works with different chains like Polkadot, NEAR, IRISnet etc, staking yields can differ depending on the network the Marlin node serves :D
You’ll soon be able to stake both POND and MPond
Participate in governance with MPond
Convert from POND to MPond to become a part of DAO
Make proposals and decide on the network's future (including staking rates and phase changes of the network)
Update gauges for Flowmint
and much more!
We are working on a series of content. Follow us on our official channels to stay up to date on all things Marlin!