BIP-[XXX] Aura Multisig Blacklisting for Governance

[Andrea81]

Background

On the 10th of November 2022, “vlAURA” token holders voted for the implementation of a new voting system that could allow Aura to use the entire veBAL stack invested in their Protocol for Balancer Governance voting with a “winner takes all” approach. You can read about it here. Voting results can be found here.

On date 14th of November 2022, shortly after the vote was closed, @Smallcapscience and @Tritium presented a proposal on the Balancer forum to “stop counting vlAURA as part of Balancer governance. Otherwise, Aura votes will be counted twice. Once if/when users vote of Balancer Snapshots, and once when the Aura multisig votes with all of veBAL.”

This request, while legitimate, was however rejected by the Balancer Governance.

Current conditions now require Aura to officially confirm they won’t use their multisig wallet in order to allow legitimate voting through Balancer Snapshot.

Proposal

We formally demand a soft blacklisting of the Aura multisig address. Meaning, a request to Aura Representatives to abstain from using their multisig wallet in Balancer Governance voting.

The unlikely event that Aura uses its multisig for Balancer voting, would trigger a short notice request to effectively blacklist Aura Multisig from participating in Balancer Snapshots so as to protect the integrity of the Governance.

We trust that these steps won’t be necessary and will monitor the process and remain at disposal for help on the matter.

Specifications
Apply the following strategy by changing 0xC128a9954e6c874eA3d62ce62B468bA073093F25 to 0xd5c5fc773883289778092e864afE015979A10eb9 in Strategies erc20-balance-of and delegation:

https://gist.github.com/ajb/ddf05c05125578d1f633ce7a354789cb

Risks

While minimal, given the trust and robust policies adopted by the Aura Community to date, there may be a risk of using the Aura multisig wallet for Governance voting, which would invalidate the vote on this and future proposals. This will however trigger legal proceedings against Aura and its representatives and request a short notice request for blacklisting as detailed above.

[ProfitMaxi]

Full support @Andrea81. Aura votes should not be counted twice unless they want to exploit a flaw in the original design and make a highly profitable governance strategy “ala Avi.”

[solarcurve]

Thank you for the proposal. To ensure this is something possible to implement in the event it passes I’d suggest getting a snapshot strategy made that blacklists the relevant address(es). Please make it clear which strategy we should remove from our snapshot and which one we should add. Then I don’t see any blocker to this going to a vote at your request.

Cheers

[adamb0123]

It appears that the address holding 2.6 million veBAL is this one: 0xaF52695E1bB01A16D33D7194C28C42b10e0Dbec2

Someone could either create a snapshot strategy (will take all but a moment) or it could also be done by deploying a contract such as this one:

contract VeBalWithoutAura {
  function balanceOf(address user) {
     if (user == AURA) {
        return 0;
     } else {
        return IERC20(0xC128a9954e6c874eA3d62ce62B468bA073093F25).balanceOf(user);
     }
  }
}

It should be trivial - and agreed, Andrea will need to specify before this goes to vote.

[Ad_Astra]

Can you explain why you voted against the prop that Tritium put forth to solve this (38% of the no vote)?

[Xeonus]

As stated above by others, as soon as the specifications are properly formulated, I don’t see any issue for this going to snapshot asap.

@Andrea81

This request, while legitimate, was however rejected by the Balancer Governance.

Obviously the Tetu Council for Balancer Affairs and other wallets associated (?) voted against it.
I see where you are coming from. You guys want the same rules to be applied to all veBAL wrappers. I strongly suggest that we all try to work out a framework (once again) so that all veBAL wrappers adhere to the same voting standard.

One thing that I still fail to understand though: What is the long term plan of „theOne“ moving forward?
As several people have stared in the BIP-112 thread, we should try and find common ground and make Balancer governance as fair as possible for all parties involved. Obviously, humpy/theOne invested a significant amount of capital and therefore he can now pretty much direct proposals how he pleases.

In my opinion, we finally started to become a healthier DAO, protocol revenue is growing despite very rough market conditions. We try to optimize our cost-footprint wherever we can while also building cool products like managed pools. It would be such a shame to throw all of this in the dumpster because of some kind of power play.
Let’s get aligned and understand each other’s interest better.

[Matt_Alfalfa_or_Span]

I accidentally deleted that post I just made while trying to edit. Anyway, you actively voted against the proposal you referenced as being rejected with I think about 1.5M veBAL. Any reason why you didn’t disclose that in this present proposal?

[Tritium]

Should such a strategy not ban direct voting from all wrappers and require that each wrapper setup some sort of passthrough voting similar to AURAs or the one that balancer governance thinks everyone should adopt?

There seems to be a double standard here.

Tetu can delegate all their votes to Andrea who can use them to block AURA governance?

sdBAL can do whatever they want?

Aura can’t vote with its own locked tokens?

I’d at least like to see this be a moderate and fair governance that provides equal rules to all wrappers.

[adamb0123]

Not sure why this is in reply to my comment, which was just clarifying how simply this could be implemented.

You know I am already on the record that I’d like tetuBal and sdBal to use the same rules.

[ZenDragon]

Turbulence is a common theme lately. I 100% support not allowing any votes to be double counted, which is why i voted yes on BIP-112. I do not think you have the right, power, or jurisdiction, by any means, to invalidate an outcome of voting that is directly due to your refusal of a solution. I think these types of threats should be left off Balancer’s forum, the behavior sets the stage for a combative discussion and I’d like to think everyone here owns veBAL meaning their interests are semi-aligned.

If we are setting an example with Aura as not being allowed to vote through a single unilateral entity, we should do the same for all wrappers. No veBAL wrappers can have a core delegate on their behalf, which would mean you, Andrea, would also need to relinquish your delegate votes from tetuBAL. I personally think neither should happen and both entities should use their veBAL power as they see fit. To need Balancer to be a vehicle to strong arm the protocols who are building on it and thereby dwarf their own governance process is self destructive.

Whichever system turns out to be the best for new users is where veBAL will be locked. If choosing one for their governance initiatives is a reason to alter that decision then those wrappers will propel themselves to make more decisions how they see fit. I do not support the outcome you are proposing, but I ask everyone to hold themselves as accountable as their “competitors” so we can all stop doing this dance of morality.

[Andrea81]

Dear @ZenDragon ,

I’m not sure I fully grasp your message here:

@ZenDragon

I do not think you have the right, power, or jurisdiction, by any means, to invalidate an outcome of voting that is directly due to your refusal of a solution.

I am proposing a solution with the above proposal. Which is officially requesting Aura to refrain from using their multisig wallet for Governance voting. This is simply in order to avoid double-counts. The request is not confrontational but only procedural. If you have a better solution please share it so I can update the request/proposal.
For the rest (right, power, jurisdiction) also here I am confused on the meaning. Do you want to censor me? Would you prefer me not to participate in the discussions? What power or jurisdiction are you referring to? I’m curious to better understand the meaning of your message.

@ZenDragon

No veBAL wrappers can have a core delegate on their behalf

Would you be so kind as to point me to the regulation supporting this statement? I would be happy to correct any wrongdoing so to follow the correct guidelines.

I am looking forward to resolve this issue and restart normal Governance operations as soon as Aura will confirm their decision.

[Andrea81]

As an additional note:

If the Community think that moving the Tetu delegated voting power from myself to a Tetu Delegation for Balancer Affairs separate address would resolve the issue, I will be happy to support the initiative. Please take this as a token of goodwill.

[ZenDragon]

@Andrea81

@Andrea81

This will however trigger legal proceedings against Aura and its representatives and request a short notice request for blacklisting as detailed above.

This was what I was mainly referring to. Not sure how realistic following through on this threat is, if you or any entity actually can do anything, given the nature of decentralization. Honestly doing so would probably nuke BAL and AURA price to the point where everyone loses. Of course just an opinion, I am no litigator and do not want to harp on something that seems like a shell of an issue. imo, it is an unneeded fear mongering technique. I would never want to censor anyone and have no power to do so. For better or worse you have been a long time Balancer participant, different opinions are always valuable, arguably differing one’s more so than agreeable ones .

For your second quote/response. There is no regulation to my knowledge which is why there is contention on the topic. Perhaps you quoting that statement without the surrounding context portrays it differently than I intentioned. The goal would be to apply a set of guidelines or rules in which all wrappers operate, hence this post and the previous vote of BIP-112. I appreciate your following comment of what seems to be an approachable middle ground. I would be more receptive to an overarching rule or rules as opposed to this “rule for Aura” now then another rule for tetu or sd as scales tip in different directions. For this I need to reflect more, but I ultimately this proposal needs to fail or change first.

Just a disclaimer on my end, my tone is meant to be completely constructive and not aggressive in any way. Often text can be misconstrued.

[Xeonus]

@Andrea81 can you please provide the appropriate specifications in your proposal if you want it to make it to the next voting round on the 24th? Thank you.

[Andrea81]

Hi @Xeonus ,

Proposal updated. Let me know if this looks good to you.

[solarcurve]

can you advise if it is possible to add a strategy that has not been approved via PR to the snapshot repo?

[humpydumpy007]

The contract should be deployed. strategies erc20-balance-of and delegation
should point to the deployed contract address instead of veBAL address
( 0xC128a9954e6c874eA3d62ce62B468bA073093F25 )

[solarcurve]

thanks, I guess all we need is the contract address then and this should be vote eligible

[Andrea81]

All necessary corrections have been made. I kindly request for this proposal to go to a vote.

[Fernando]

This opinion is just my own, I’m not speaking on behalf of Balancer Labs:

@Andrea81

The Balancer voting result of their proposal however could be read as a rejection by the Balancer Governance of the new voting principle proposed by Aura. It could also be argued that such decision can be attributed to the fact that the Balancer Community does not approve a proposal that favours voting centralization of such a large Protocol

The votes that made this outcome were all added last minute by wallets that are unequivocally owned by Humpy. Just to make clear, this was a decision made by a single actor who deservedly acquired a lot of voting power and I’m not questioning the outcome of that snapshot vote. But that doesn’t change the fact that it IS a single actor voting against almost everyone (if not everyone) else in the community.

Aura and other veBAL derivative protocols have sovereignty to decide how to use their veBAL. If they decided to use it in full, the same way Tetu does, IMO Balancer governance should not boycott it. The situation would have been a lot different if Aura did not immediately suggest to NOT double count their own votes. It’s clear that the intention has always been to simply change the way Aura votes, not to double count votes or cheat.

If the concern by Humpy was really to avoid double counting they could have simply voted in favor or not voted at all (given the quorum had already been largely hit). If they voted against the solution of double counting Aura votes I personally would see absolutely no foul play if Aura did end up double voting, which would be 100% a consequence of BIP 112 being voted down by Humpy.

If Humpy sees double counting as a problem (and they should, as does everyone else in the community) then what would make sense for me is for them to ask to revote BIP-112 and this time vote aligned with their interest of avoiding double votes. I am not a lawyer but can hardly see a court case if Aura just used the veBAL that they have in the Aura smart contracts as this doesn’t break any rules. If Humpy thinks it does I’d be genuinely curious to see when these have been agreed upon by governance and happy to change my mind.