Re-Enable the THX/USDC Gauge on Polygon

BAL Gauges
1

Gauge Proposal Template:

Summary:

Balancer governance has approved [BIP-30] and therefore a number of gauges are being deactivated. The THX/USDC 80/20 pool doesn’t seem to match the ‘kill’ criteria and supporting 80/20 pools is good for building relationships with early stage protocols. While we ask to reinstate the current THX/USDC gauge as a temporary solution, we eagerly await BIP-19 and signal to create a 50/50 ‘core pool’ at that time.

References/Useful links:

• Website thx.network
• Documentation https://docs.thx.network
• Github Page github[.]com/thxprotocol
• Communities discord[.]com/invite/u3DruB5pm5
• Summary of LBP launch medium[.]com/thxprotocol/thx-launch-mission-completed-learn-what-is-next-42345c88393b
• CoinGecko coingecko[.]com/en/coins/thx-network

(*sorry for the redacted links, having to work around the 2 links per post limit)

Protocol Description:

THX Network allows creators and communities to create and embed ERC20 and ERC721 tokens in their existing platforms, increasing engagement and enabling new revenue streams. $THX is the protocol’s governance token and it’s active on both Polygon and Ethereum mainnet. At $0.042 the $THX token sits near all-time-high (ATH) against ETH.

The project has received funding from the European Union’s Horizon 2020 research and innovation program under agreement No 82888 (Blockpool) and No 824509 (Block.IS).

Motivation:

The THX/USDC 80/20 pool doesn’t match the ‘kill Gauge’ criteria;

  • The 80/20 THX/USDC pool is the primary source of $THX liquidity, created after the first Liquidity Bootstrapping Pool (LBP) launch using Copper on Polygon working closely with Alchemist and Copper team members at the time (dec. 2021)
  • It has had up to 0.3% of the vote and would have gotten over 0.1% in the next round

Balancer has been vocal about and supportive towards projects bootstrapping with 80/20 pools, which suffer less from impermanent loss. In the weeks following the 80/20 THX/USDC pool launch, which was before veBAL existed, Balancer DAO has supported the pool with $BAL emissions. We believe supporting early stage projects adopt Balancer helps the whole ecosystem by building strong relationships right from the start and that this should also reflect when considering approval of Gauges.

Temporary Gauge

We’re aware of the changes coming with BIP-19 and understand that this proposal will effectively be for a temporary Gauge as we wait for Balancer to deploy the new pool factory. We hereby signal that we intend to launch a 50/50 THX/staked MATIC pool that will have the added benefit of having the ‘core pool’ status, once the changes in BIP-19 are effective.

Acquiring $BAL

In closing, our DAO is about to acquire $BAL and (decided mid June, see gov.thx.network/t/diversify-20k-community-treasury-usdc-into-bal-vebal/51) and will be requesting for its multisig address (0x4a30c80A2c41312ce4ee79f730C8D84cAD9f7B31) to be whitelisted for governance.

Specifications:

  1. Governance: DAO multisig 3 out of 4 with two being controlled by core team members employed by THX Network BV (limited company, established 2021, The Netherlands) and two from external community members; Evert Kors (co-founder Sherlock protocol) and Bram Rongen (former CTO Hubs).
    matic:0x14d4D5CA3Cc67879168dEC88aB018975B24E214b
    matic:0x2A430537e62e7620D7A984154045E3305977d84b
    matic:0xE554e4CC68cbD6Ea934C826cCAFec321f38ABCa5
    matic:0xe1E94562014da0CE71C72683eDcEE9D98936B533
    eth:0x14d4D5CA3Cc67879168dEC88aB018975B24E214b
    eth:0x2A430537e62e7620D7A984154045E3305977d84b
    eth:0xE554e4CC68cbD6Ea934C826cCAFec321f38ABCa5
    eth:0xe1E94562014da0CE71C72683eDcEE9D98936B533
    The multisig addresses control the $THX token allocations and the Treasury liquidity. September onward will see the launch of Snapshot voting for $THX holders, see latest AMA (28:00) and for the slides twitter[.]com/THXprotocol/status/1546457897755869184

  2. Oracles: no external oracles are used.

  3. Audits: docs.thx.network/other/audits

  4. Centralization vectors: our API and single sign-on (SSO) infrastructure introduces some centralization in exchange for better UX. Overview docs.thx.network/developers/network.
    Pools implement a RelayHub for executing signed transactions on behalf of our wallet. A single key is permitted to forward those signed transactions to the RelayHub.
    Context and mitigation: Private keys used by our backends are stored as encrypted secrets in our AWS parameter store. This store is only accessible with proper IAM access configuration. Two core team members are currently bearing those roles.
    Our authorization backend (OAuth2 OIDC) utilizes Torus network for private key distribution in our Web Wallet.
    Context and mitigation: we have added Metamask authentication for power users and are implementing Metamask transaction signing in our Web Wallet.

  5. Market History: the $THX token launched at $0.12 and currently sits at $0.042 and near all-time-high (ATH) against ETH. The pool has been active since dec. 2021 and generated $1.6M in volume since then. It has about $900k in TVL.
    Pool 0xb204BF10bc3a5435017D3db247f56dA601dFe08A (Polygon)
    Gauge 0xedb67dD52156E7ae887F948ECF7B63092Da33670 (Polygon)

  6. Value: The 80/20 THX/USDC pool is the primary source of $THX liquidity. The pool usually ranks number #10 by TVL and fees collected on Polygon.

2 Likes
2

I do want THX to remain on Balancer - it’s great to see you plan to acquire BAL. Since your discussions with the old liquidity mining committee many things have changed and it is simply too risky to have small cap tokens with 80/20 gauges except for very rare exceptions like a ve system built with the BPT. Temporary gauges are also not a great idea to me. I fully support your proposed core pool once we have the new weighted pool factory to make that possible. Unfortunately we don’t know when we’ll have that exactly which makes this a difficult situation.

just my personal views, others may feel differently. The best option here is wait for your new core pool.

1 Like
3

Yes, however why not kill the Gauge if and when any undesired events happen instead of moving proactively against a Gauge that doesn’t meet the kill criteria? PS. Note that we don’t have unlocked “whale sized” private sale allocations or holders. So someone suddenly showing up with a huge amount of $THX to LP and game the Gauge is very unlikely.

Would you support a 50/50 THX/stMATIC or THX/WMATIC Gauge at this moment in time?

2 Likes
4

If you’re amenable to going with THX/WMATIC 50/50 I would support that today, yes.

1 Like
5

Any thoughts about going for stMATIC instead of WMATIC; the latter seems a more durable alignment with Balancer’s goals considering the BIP-19 ‘core pools’ concept?

1 Like
6

that would be the ideal pool, problem is we’re waiting for a new weighted pool factory to allow Balancer to apply the protocol fee to yield bearing tokens. It might come by the end of August but the timing is not certain as development work is ongoing. Once we have it you could make that and become a core pool.

1 Like
7

We ran some calculations and are reading our multisig to seed a $70k 50/50 THX/stMATIC pool. The 80/20 pool wil be reduced 10% in size but other than that remain in place. Overall liquidity on Balancer will be increased and together both pools will provide the main source of $THX liquidity by far.

I’m reading up on the ‘Gauge Framework v1’ which makes sense imo. The 2% cap is no concern, we will be happily sitting at 0.1%-0.15% of the votes and going from there based on protocol growth and veBAL purchase strategy.

Any thoughts before we proceed with establishing the 50/50 THX/stMATIC pool?

2 Likes
8

this pool has to be created with the new version of the weighted pool factory which has not been released yet. As of yesterday the update was “98% there” so I expect early next week at the latest. You’ll have to use balpy to create it as there’s no ETA on when the pool UI will use the new factory. If you need help or prefer we make the pool for you, don’t hesitate to reach out to me.

1 Like