Introduction
This describes three signaling governance proposals that we are seeking consensus for in the next release (v1.1.0). These three items are all OPTIONAL. Their inclusion or exclusion will be determined by the outcome of the three governance proposals.
Please note that you are not voting on a particular piece of code at this time, but rather whether or not you want to see these features included in the next release. If the signaling proposal passes governance, there will be an additional agora discussion and subsequent governance vote on the actual upgrade code implementation.
Optional Features Needing Consensus Governance
The first two optional features have been requested by Binance. On December 28th, 2022, Binance made changes to the voluntary burn of Terra Classic trading fees as described in the following announcement.
In order for Binance to continue the burn of half their fees, the first two items were requested to be implemented in our next release. The third item is a feature that is independent of Binance and the result has no bearing on their request.
Optional Feature # 1 - Wallet Exemption to On-chain Tax (Binance Request 1/2)
Binance has requested that the internal movement between Binance owned wallets be exempt from the burn tax (currently set to 0.2%). A list of Binance owned wallets has been provided to the community via the above announcement. It was confirmed with Binance that movement to and from Binance wallets will still be taxed. This means deposits and withdrawals are not exempt, but rather only the internal movements between wallets will be exempt for their internal security purposes. This first governance proposal is seeking consensus around this request from Binance. The implementation of this whitelist feature will be parameterized, with the initial list set to the provided Binance list. Thus, if this feature is accepted to be adopted, future changes to this whitelist can be controlled by the community in a governance parameter change proposal.
Optional Feature # 2 - Separate Burn Wallet Exempt from Seigniorage (Binance Request 2/2)
While seigniorage has been “turned off”, there is no guarantee that it could not be changed in the future. Thus, Binance has requested that a separate burn wallet be created where any LUNC manually sent to this burn wallet, be excluded from the seigniorage remint calculation done at the end of every epoch. Basically, any LUNC sent to this wallet is burned, and stays burned. This second burn wallet will be publicized and could be used by anyone in the community for this purpose. The second governance proposal is seeking consensus around the creation of this second burn wallet.
Optional Feature # 3 - Burn Tax Split to Community Pool
This is the third and final optional feature we are seeking consensus upon in the next release. Previously, the community utilized the seigniorage RewardWeight parameter to remint a portion of the burned supply to the community pool. This was confusing to many people in the community. The third governance proposal is seeking consensus around the creation of a new parameter that does not utilize the seigniorage remint policy, but has an independent ability to directly send a percentage of the on-chain tax to the community pool. The initialization of this parameter will be 10% community pool, 90% burn as noted in governance proposal #11111, which was the consensus before the Binance requests to turn off seigniorage (and are being alternatively handled by feature #2).
Summary
In summary, there will be 3 signaling governance proposals immediately put forth to gain consensus around whether the community would like to see these optional features included in the next release. The first 2 would be required for Binance to continue burning half of their trading fees. The third is independent and has no bearing on Binance’s request.
Any feature that passes the governance signaling proposal will be subject to another final vote for the community to accept. Thus, the signaling vote at this time is not an acceptance or rejection of the technical adoption of these features, but rather a question of should they even be included for consideration in the next release.
Finally, if all three optional features fail to pass the signaling governance, there will still be a release v1.1.0 put forth for voting that contains consensus breaking required security updates, including a patch recently provided by Jacob Gadikian.