Introducing Olympus V2
Olympus has been live for almost seven months. We have demonstrated in that time that the model works, and that it works well. However, that does not mean there is not still room for improvement.
With that in mind, we are proud to introduce Olympus V2.
Olympus V2 strongly prioritizes decentralization and immutability.
Let’s go over what’s new:
Stakers will take full control of protocol contracts through an implementation of Compound’s Governor Bravo. This will occur in a phased roll-out. We will begin with a guardian multisig (like we have today), followed by an on-chain governed Treasury, followed by on-chain governed bonds.
On-chain governance will occur through the gOHM token (previously called wsOHM). Users can now stake directly into/out of gOHM, saving precious time and gas.
Bonds have received a significant overhaul. The upgrades are as follows:
- Bond payouts are staked at the time of purchase. Rather than requiring bonders to factor in missed rewards when considering a discount, they are now earned by default. This means that any >0% discount will outperform staking, and as a result discounts should not deviate far above 0%. This is good for minimizing market pressure and maximizing protocol efficiency.
- Bonds no longer vest linearly. Instead, bonders must wait until the end of their term to redeem. This illiquidity is enabled by staking bond payouts, and creates a form of locked staking that will save ohmies money by removing the incentive to incur wasteful gas transactions through frequent redemption.
- New bond types are created as isolated offerings. Each bond has a maximum amount of OHM that can be paid or a maximum amount of principal that can be purchased and, once exceeded, the bond is retired. All parameters of the bond are set in stone after initialization. This improves both budgeting and immutability.
- Bonds can be held as NFTs. This enables liquid secondary bond markets.
- Bonds can be fixed-term or fixed-expiration. What we have now is fixed-term; if the term for a bond is 1 week, your maturation date will be in 1 week. Fixed-expiration means the maturation date is the same for all who buy that bond. If a bond has fixed-expiration on day 8 and you buy one on day 1, your term is 7 days; if you buy the same bond on day 2, your term is 6 days. This lends itself to composability; fixed-expiration bonds can be wrapped into a fungible token and traded like any ERC20.
- Bonds offer a front-end reward. This will incentivize third-parties to run front-ends for Olympus, reducing single-point-of-failure risk.
All new contracts will be audited. We are working to enter an audit with Runtime Verification for these smart contracts shortly. We are hopeful that this concludes within four weeks, and we will keep you updated as we receive more information.
Enabling V2 will require migration to a new set of smart contracts. The migration will replace all existing contracts, including the OHM token. Migrating will require some coordination, but we have worked hard to make this as easy and time-insensitive as possible.
The process will be described in depth in a forthcoming forum post. However, you can take relief knowing that when it begins, you will have as much time as you need to complete migration, there will always be liquidity for V1. No rewards will be forfeited. Migrating will be a single transaction and should not cost much more than staking. Partial liquidity will be moved from OHMv1 while migration is in process to facilitate the movement of borrowers.
V2 is a massive step for Olympus. Through these upgrades, we will operate in a fully trustless, governance-minimized environment in the coming months.
This is in line with the vision we set out to bring into reality eight months ago. We hope you are as excited as we are!