PR with payload
Summary
The ether.fi team proposes a Balancer Boosted Gauge for a weETH-WETH pool on Base, with no emissions cap. This will serve as a 100% yield bearing pair.
References/Useful links:
• Website - https://www.ether.fi/
• Documentation - ether.fi Whitepaper | ether.fi
• Github Page - etherfi-protocol · GitHub
• Discord - ether.fi
• Twitter - https://twitter.com/ether_fi
Protocol Description:
ether.fi is a decentralised, non-custodial liquid staking protocol built on Ethereum, allowing users to stake their ETH and participate in the DeFi ecosystem without losing liquidity. The protocols eETH is a liquid restaking token (weETH is the non-rebasing equivalent), serving as a representation of ETH staked on the Beacon Chain, which rebases daily to reflect the associated staking rewards. Users can deposit ETH into the liquidity pool on Ethereum Mainnet to mint eETH, hold eETH to accrue rewards, and use eETH within DeFi or swap it back to ETH at any time via the liquidity pool. The protocol currently employs a permissioned validator set, however this will transition to permissionless based on the protocol roadmap.
ETH staked through the ether.fi liquidity pool accrues normal Ethereum staking rewards and will also be natively restaked with EigenLayer. Staking with eETH on ether.fi automatically natively restakes that ETH to EigenLayer and accrues normal staking rewards while allowing users to keep composability on their eETH in other DeFi protocols.
The eETH contract has been live since June 2023, with eETH launching to the open market on November 15th, 2023, and has approx. 1.23 million ETH held within it. Being a liquid representation of staked Ethereum, the price of the token is aligned to the price of ETH.
Through these mechanisms, eETH acts as a conduit for individuals to engage in Ethereum’s staking & restaking process with the added liquidity, making it easier for them to enter and exit staking positions while also benefiting from boosted rewards.
Motivation:
ether.fi is looking to seed a weETH/WETH pool on balancer to serve as a primary source of liquidity for weETH on Base. Incentivising a Balancer pool will continue to boost the liquidity of the LRT on Base. Higher liquidity ensures that traders and investors can easily enter or exit positions, which is essential for the overall usability and attractiveness of the LRT token within the L2 DeFi ecosystem.
Specifications:
- Governance: - Currently, the protocol utilises a multi signature wallet, with the signatories being doxxed ether.fi executives. This will change with the evolution of the protocol, moving to decentralised governance with a DAO and a governance token.
- Oracles: - The Protocol relies on an oracle for withdrawals and beacon state, however, the reliance on an oracle for beacon state is set to go away in an upcoming Ethereum upgrade. The Oracle is based on the hash consensus mechanism and run by the committee members. Initially, the ether.fi team will be the only ones to operate the Oracle nodes, however as the protocol grows, it will add more external parties to join the committee.
- The exchange rate feed for weETH-ETH on Base has been deployed by Chainlink.
- Audits: - Audit reports for the ether.fi protocol are found on the GitBook page - Audits - ether.fi. The audits have been carried out by reputable firms such as Certik, Zellic, Nethermind, Omniscia and Solidified to ensure the security of the protocol. An audit competition was also recently completed through Hats Finance.
- Centralization vectors: - The centralization vectors primarily relate to the Oracle until it becomes decentralised, in line with the protocol roadmap. The price (staking rewards for rebasing) and the validator management (spinning up new validators and exiting them for liquidation) are also currently centralised for the early stages of the protocol to ensure mobility. As mentioned above, the signatories currently consist of the doxxed executive team at ether.fi, however this will be upgraded with the implementation of the ether.fi DAO and governance.
- Market History: - eETH was first deployed November 15, 2023. Market history and protocol information can be found here on the ether.fi Dune dashboard - https://dune.com/ether_fi/etherfi
- Value: - The weETH/WETH pool on Balancer is intended to serve as a primary liquidity source for the token on Base. The pairing of weETH with WETH will maintain the originally intended smooth trading experience, while yielding more rewards for the liquidity providers.
weETH on Base: 0x04C0599Ae5A44757c0af6F9eC3b93da8976c150A
weETH/WETH Base pool on Balancer: Balancer 2
Child chain gauge 0xF7862A614fFEA2BF8Ef2D66a872bE2Df735D22E6— mainnet root: 0x2280B8C8B401CA54eBF15736B77E1d3bF4924A9D
Specification
Transaction: The Balancer Maxi LM Multisig eth:0xc38c5f97B34E175FFd35407fc91a937300E33860 will interact with the GaugeAdderv4 at 0x5DbAd78818D4c8958EfF2d5b95b28385A22113Cd and call the addGauge function with the following arguments:
gauge(address): 0x2280B8C8B401CA54eBF15736B77E1d3bF4924A9D
gaugeType(string): Base