BSC discussion thread

Posted on behalf of DAO Core contributors.

As part of the initial DAO bootstrapping deployment plan, voted in by early stakeholders, a small BSC rollout has occurred.

Initial deployment plan (pre-TGE), in correct sequence:

Ethereum:

  • Balancer Liquidity Bootstrapping Pool
  • DAO on ETH (Wallets + governance)
  • Uniswap seed liquidity on Ethereum
  • Native staking for $MC and $MC/ETH on Ethereum

Binance and BSC

  • Binance Launchpool
  • BSC BEP20 rollout of $MC (multisig BEP-20 wallet with some locked bridge funds and a small part of the DAO treasury for operational purposes)
  • Pancake seed liquidity

All other things the DAO will or will not do on BSC are up for debate. That is, up for governance. Since TGE there is a more open governance system in place that everyone (with $MC tokens) can participate in. This governance system was not possible without a token, which is why a few early bootstrapping decisions has been made through difference governance methods.

Regarding the choice for BSC and Binance:
The DAO already has some very interesting partner games that are on BSC. The DAO already has payment obligations on BSC and will soon also generate revenue on BSC. Additionally, it is our belief it will bring a new category of $MC holders to the DAO. We believe this validates BSC on both the user “acquisition” side and the operational side.

Ethereum will remain our mainstay (if the community agrees). Rollouts on other chains will always be up for a vote and in our opinion should be in line with the activity the DAO has on a certain chain or the opportunities that the chain can bring to the DAO.

We (core contributors) think the DAO should be hyper pragmatic and flexible. The DAO should not be ruled by ideology. Every chain should be judged on its merits and what it can bring to the DAO.

We would like to welcome a discussion surrounding BSC and we welcome new ideas that could benefit the DAO.

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Binance and BSC response by the Sad Cat Cartel

Like a majority of the Merit Circle community, the Sad Cat Cartel is delighted to see the announcement for the listing on Binance. This was announced alongside a Launchpool listing (which has been discussed at length in the MC Telegram) and also a Binance Smart Chain listing. It is our understanding that this BSC rollout was agreed upon alongside the Binance and Launchpool listings and so isn’t up for a DAO vote due to the deal being signed prior to the LBP.

Despite this, we wanted to voice both our concerns, as well as what we believe to be the benefits of listing on Binance Smart Chain.

Position

Our position regarding chain activity is quite clear. We would like Ethereum to be Merit Circle’s #1 chain for all operations and activity. This means keeping the liquidity on Ethereum as well as the staking rewards program. It would be a huge blow to the current LP stakers (many of whom have locked up their stakes for up to a year) if their staking rewards were somehow negatively affected by deploying to a new chain and/or introducing a new liquidity incentive program outside of Ethereum. Something which happened already due to the nature of the Launchpool, where the amount of MC in the market is growing for 60 days. I cannot ignore the trust issue here. It is a concern that deployment to a new chain could fragment liquidity, voting power, and volume - all of which have been highly successful with the deployment on Uniswap V2. These metrics aren’t something we want to lose.

Technical

We take the safety and security of the MC token seriously. From a technical standpoint, many chains have recently come under a huge amount of criticism from developers, database engineers and quants due to failing nodes, a lack of testing, and apparent instability issues. It has come to the point where some developers are concerned some chains might collapse completely at some stage which could potentially put funds at risk. Reading this caused us to have great concerns. We’d prefer to leave this highly technical discussion to the Github participants of the appropriate chains, unless you’d like us to clarify further in a separate post.

  • Solana [1]
  • BSC [2]
  • Avalanche [3]

Community

We can see that there will be a lot of positives stemming from a BSC listing. The MC community will be able to trade MC on a dex with low fees and will be able to move tokens between Binance and BSC easily and cheaply. We will be able to tap into the BSC community which will hopefully translate to more holders, more engagement, more decentralisation of holders and more volume. As mentioned by tommyq, P2E games are also being built on BSC, some of which Merit Circle has already partnered with. By deploying to BSC we will be able to interact with these projects more easily and process payments more efficiently.

We do have a concern about BSC and its BNB and BUSD ‘whales’, who could potentially hold and farm with great quantities of BNB and BUSD. If there is to be a rewards program, much of these rewards will naturally go into the hands of these idle BNB/BUSD whales - and wouldn’t favor the DAO and/or regular BSC community members. Perhaps additional community programs, contests or other events could help support the intended and positive network effect of BSC. The decentralisation of holders is important to us, as well as community growth.

View

We respect the deal that the Merit Circle team made with Binance to list on the CEX, the Launchpool and on BSC, and understand why this deal had to be made without disclosure and without a DAO vote. We believe it is still important to voice our concerns regarding the BSC launch so that the variables which haven’t yet been decided upon can be done so in an informed manner.

  1. We want Ethereum to continue being our #1 chain of operations and activity
  2. We do not want to lose any current Ethereum rewards whatsoever to foreign chains
  3. We want our funds and the MC token to be safe and secure
  4. We do not want fragmentation of our liquidity, voting power, and volume on Ethereum
  5. We do not want to lose decentralisation in favor of centralisation
  6. While the Launchpool program makes for a positive network effect, some trust was lost
  7. We’d like more details around the ‘Pancake seed liquidity and incentivized pool’.

Conclusion

All-in-all, we’d like to have more details on how the reward system will be laid out for the DAO, and how the community members will benefit in terms of said rewards. Meaning, the incentivization rewards and details surrounding the MC token and the interaction on BSC. Under no circumstance do we want to lose DAO governance utility and power away from Ethereum to favor BSC (or any other chain, for that matter).

To us, every MC token and DAO member is precious and valuable, and we hope we’ve given this proposal a good run-through.

Signed with left paw hook,

Calico ‘Fluffbeard’ Jack

13 Likes

Dear Sad Cat Cartel,

Thanks for your write-up and for raising some valid concerns.

Replying here on behalf of the core contributors.

About 1M$ in Binance seed liquidity will be deployed on an $MC/$BNB pair. These LP tokens will be owned by the DAO and not enter any kind of staking. The DAO stands to benefit from $MC and/or $BNB price appreciation and swap fees. Similar to how liquidity was seeded to Uniswap (15x as much is provided by the DAO on Uniswap - unstaked by DAO). All of this will be transparently published and auditable on-chain.

The difference will be that BSC will have no extra incentives for staking. As it stands today there will be no governance or native staking on BSC (until the community decides otherwise).

There could be added indirect staking incentives through an incentivized Pancake pool. We believe this could be beneficial, especially if we time it in a way that it starts when the Launch pool is almost ending. In conjunction with another Binance.com native staking solution. So Binance/BSC users that are not prone to using ETH, have outlets to stake/use their $MC. We will also work with Binance to educate their community on Merit Circle (Ethereum) native staking, to, hopefully, convert some non-ETHers to our native staking solutions.

We have been talking to Pancake, but nothing has been agreed on yet. There have only been soft agreements on this topic. We deliberately left it open as something the DAO community can vote on, this is not directly under any form of contract. We will issue a proposal and discussion topic here. To give complete transparency to the DAO on what the deal would entail. We will also invite Pancake to weigh in. We believe there is no rush here, as currently there are good incentives offered to Binance Launch pool $MC stakers for the BSC and Binance community. The two communities are different but do overlap sufficiently in our estimation. Ideally, we would like to see an incentivized pool start 4-7 weeks from now. When rewards in the launch pool start to wear off in APR, and/or completely after 8 weeks.

We also believe Ethereum should remain the main chain. We are very cognizant of liquidity and staking rewards (tied to governance). We think both should not be fragmented and should be concentrated on one chain (currently Ethereum) for as much as possible. As there is an advantage to each $ of concentration for both governance and liquidity. As outlined in prior comments, we do think BSC makes sense as one of the chains to have a limited and controlled roll-out on.

It is currently the #2 chain and with Binance’s complete support, it has a moat that makes it likely it will stay a dominant chain. Similar to Solana with FTX.

If this changes, we can adjust.

In the meantime, the risks will be limited to the size of our rollout. Currently, just 2% of the treasury is held on BSC and 3% of $MC the supply has been issued there as (locked) bridge supply. We can always adjust this split. This part of the supply would not be in danger if anything happened to BSC, as it is non-circulating supply. The 2% treasury assets would be at risk when BSC completely fails, but the risks are minimal, while the operational upside is substantial in our opinion.

Miauw out :cat:

3 Likes

Hey tommy,

Its still not clear will there be any incentivize rewards for pancake pool. We obviously don’t want to dilute our rewards, yet again. Binance has already 1/3 of circulating supply of MC as rewards and most goes to the BSC whales and its quite a lot of dilution for people who committed the long term vision and lock up of liquidity pools specifically.

2 Likes

Quoting Tommy’s response here;

The difference will be that BSC will have no extra incentives for staking.

There could be added indirect staking incentives through an incentivized Pancake pool.

We have been talking to Pancake, but nothing has been agreed on yet. There have only been soft agreements on this topic. We deliberately left it open as something the DAO community can vote on, this is not directly under any form of contract.

As you can see here - there will be no direct incentivized staking available until decided upon by the community!

3 Likes

Hi Tommy,

What would be against setting up a staking pool on BSC or another layer 2? As long as the coins rewarded are only staked MC tokens, I don’t see the above mentioned problems with big BNB/BUSD wales dumping their rewards.

The Eth fees are ridiculous and we are pricing out a huge community who would otherwise be also inclined to invest long term, if they are rewarded properly for it, decreasing the circulating supply.

1 Like

I am currently staking in Binance launchpool, after originally acquiring my tokens via uniswap.

Whatever is the right strategy is, single chain, ETH BSC multichain etc that minimizes dilution long term has my support.

I came late to the DAO, and my main headache with this project is having to constantly search for ways to minimize dilution / fight inflation. MC printer go brrrrr.

So thankyou to the team for getting this going in Binance.

I would had very happily kept my tokens in metamask, actively participate in reviewing proposals and governance, or use the tokens in other ways that are helpful for the community.

Unfortunately this doesn’t seem the right strategy today given that a lot of the community focuses on yield extraction strategy and protection of early supporter status (as we can see above and in other proposals).

I am not criticizing this, it is the rational behavior given the design and incentives. I saw it coming in, eyes open.

My hope is after one year the project can stand on its own feet, with enough liquidity etc for those that want to trade, we can significantly reduce inflation, and focus 100% of the community brainpower on more productive stuff.

Hi Tommy

I do agree that Etherium should remain the native chain of Merit Circle and that opening up $MC to the BSc Chain would create further engagement for the token and therefore the DAO. Expensive transaction fees for ETH mean that the BSC is the ideal platform for purchasing and trading $MC, but liquidity and the lack of staking prevent this from being used heavily, alienating less wealthy individuals, including those that make their living from play to earn games. Either the ETH chain must become cheaper, or the BSc chain should be used until it is no longer necessary.

Proposal

$MC/BNB LP Staking on BSc

The interests of the early adopters and status of the ETH chain as the primary chain would be preserved by preventing the staking of more LP (or dollar value) on BSC than you have already locked up on the ETH chain. Any APR offered for BSC LP staking would be lower than that offered on the ETH chain, the reason being its primary chain status and higher fees, encouraging the movement of initial staking to the ETH chain.

Early adopters would enjoy the benefits of additional staking without additional large transaction fees and improved liquidity. The DAO would be able to recoup its seed liquidity, decrease buyback costs and benefit from the 0.3% per trade on the platform.

To demonstrate the scholarship system, an additional locked LP allowance (eg. +10% of LP locked on ETH) from a $MC/ETH provider could be used by any BSC user to stake $MC/BNB. The $MC/ETH staker will receive a percentage of the BSC stakers earnings in additional $MC. The allowance would be available from a large pool, with those that staked $MC/ETH first getting priority. This again would increase the usage of the ETH chain for LP and MC staking, whilst respecting investors and increasing liquiduity on BSC.

Conclusion

This proposal is by no means a finished working idea. The main points this proposal aims to solve are

  • Needed Liquidity on the BSC for cheaper buybacks and trading (access)
  • Early Introduction of the Scholarship through tokens instead of NFT’s (educating)
  • Increased Interest of $MC on BSC and the movement of that to ETH (market expansion)

All while remaining respectful to those who have locked up funds for the higher costs on ETH

Thanks

1 Like

Hello @ZeroShugs this post won’t be considered for voting I assume because its just a post inside the discussion thread. If you want to discuss this subject you need to create a separate thread according to forum rules and we discuss it there.

Regards