Deploy Aave V3 to Metis Andromeda Mainnet

Summary Proposal for the deployment of Aave V3 on Metis Andromeda Mainnet.

Proposal: About Metis Born out of the need for permissionless and open collaboration, Metis Andromeda is an EVM Equivalent Ethereum Layer 2. MetisDAO Foundation is building a hub for the Web3 economy in 3 stages: an Ethereum Layer 2 providing top-notch scalability; built-in on-chain credentials through Nuvo, providing countless capabilities previously just available for Web2 and traditional finance; and a Decentralized Autonomous Company (DAC) framework facilitating the transition of Web2 onto Web3, and enabling Web3 and Web2 companies to build decentralized businesses on-chain. All the functionalities of real-world enterprises and all the security and decentralization of Ethereum.

Andromeda network utilizes an upgraded Optimistic Rollup architecture, allowing for high throughput while maintaining Ethereum’s underlying security. Currently, Metis is a Stage 0 Rollup, according to Vitalik’s proposed categorization framework. Metis Andromeda is a first-of-its-kind Smart L2. The concept of the Smart L2 explores the design space in between Rollups and Plasma architectures, combining rollup’s security with plasma’s scalability. Learn more about the Metis Smart L2. Our L2 is not where our vision ends, per se; our L2 is a means to the end of building an open collaboration framework to host the Web3 economy. This is the foundational base layer that will allow further developments and rollout of the next business verticals.

Our second vertical is Nuvo, a Web3 identity system providing infrastructure to mint and use non-transferable NFTs and toolkits for on-chain credentials: portable and composable credentials earned through on-chain achievements and history. Soulbound tokens will allow and enable no-coin governance, establishing provenance, decentralized key management, souldrops, and countless Web2 functionalities that weren’t previously available for Web3. Nuvo also offers a state-of-the-art cross-chain wallet, enabling account abstraction and several benefits for users. These features will help the ecosystem realize and embody its goals of decentralization, secure its long-term health, and make it the perfect setting for Web2 organizations looking to transition into Web3 without facing a substantial UI change.

Third, Koris: tooling and infrastructure for DAOs, and soon, seamless onboarding of Web2 to Web3 through our Decentralized Autonomous Company (DAC) framework. Koris provides tooling and infrastructure for DAOs to perform their day-to-day operations in a more efficient manner and will allow Web2 organizations to create and tailor DACs to their preference.

When combining all these components, Metis Andromeda will create a framework for open, decentralized, and trustless collaboration between individuals, dApps, and Web2 organizations transitioning to Web3. All the functionalities enabled by on-chain credentials, the scalability provided by the base Layer 2, and the tooling provided by Koris’ operational system. The perfect suite for dApps, Web2 platforms, or any builder.

MetisDAO Foundation announced earlier this month its upcoming transition to a Hybrid Rollup, either late 2023, or early 2024. This architecture will combine the EVM Compatibility and fast transaction confirmation of Optimistic Rollups, with the censorship-resistance, security, and fast transaction finality enabled by zero-knowledge proofs. Logically, this will be a huge step to secure the Decentralized Finance applications of the network, and provide a very robust base layer for the Web3 Economy.

Committed to supporting our ecosystem builders and seeing them succeed, MetisDAO Foundation can fund projects in 3 main ways: Builder Mining Rewards Ecosystem Grants Genesi DAC Investments *The Builder Mining Reward (BMR) program distributes 4000 METIS tokens each month based on how many txs out of the monthly total each protocol is responsible for (eg. if a protocol is responsible for 10% of the network txs, the protocol would receive 400 METIS that month as part of our sustainability grants / retroactive funding practices).

As we build the path towards a Web3 economy, it is crucial to establish strong and long-lasting decentralized finance foundations. A trusted and established money market such as Aave is a key foundational piece to building up strong capital markets in support of the Web3 economy we are building towards. Through this integration, Aave can also obtain additional revenue through protocol fees as well as through the Metis Builder Mining Program.

Metis envisions and builds towards a rollup-centric future on Ethereum, and seeks to invite Aave to be part of this mission and enable the Aave V3 front-end for Metis markets. Our robust and enterprise-grade network has a strong DeFi ecosystem, and there are borrowing/lending capabilities currently available, but having a Flagship protocol like Aave has always been our end goal in the realm of money markets. The deployment would be incredibly valuable to our ecosystem, while also complementing Aave’s multichain expansion. Technical Evaluation by BGD In the spirit of security and transparency, Metis worked alongside BGD (Bored Ghosts Developing) to perform a technical evaluation on the Andromeda network. The evaluation consisted of 13 categories, with 4 different possible scores: Optimal, Good, Acceptable, and Needs Improvement. Each of the categories scored as follows:

Oracle Infrastructure: Optimal Blockchain Explorer: Good Compatibility with Ethereum RPC standard: Optimal Compatibility with Ethereum account format (addresses): Optimal RPC public endpoints and providers: Acceptable Custom behavior (lack of) the execution layer: Optimal Support of wallet providers: Good On-chain multi-signature infrastructure: Good Transactions simulation infrastructure (fork): Good Chain data/indexing solutions: Acceptable Bridging infrastructure: asset, messages: Optimal Commitment in security-incidents: Optimal Network security/technical model: Good

*RPC public endpoints and providers: We integrated Bware services in order to increase the variety of RPC alternatives in the network. We are also in talks with other top tier providers to further bolster our RPC infrastructure. We were in communication with BGD throughout this process to ensure the providers we chose met their technical standards. *Chain data/indexing solutions: We’re currently finalizing talks with a top data indexing platform in order to enable the right tooling and services in the ecosystem.

https://governance.aave.com/t/bgd-aave-metis-infrastructure-technical-evaluation/11374

Risk Parameter Setting and Asset Listing with Chaos Labs and Gauntlet Gauntlet and Chaos Labs collaborated to provide a risk analysis and recommendations for the deployment of the Metis Andromeda network. We will follow the recommendations of these trusted risk parties for Aave, for setting both the risk parameters as well as the assets to be listed.

https://governance.aave.com/t/launch-aave-v3-on-metis/7056/61?u=metis

Incentivized Adoption

We are excited to propose a 100,000 Metis token liquidity incentivization campaign throughout a six month period shortly following deployment. We will be working with Chaos Labs to map out the most strategic allocation of these incentives to bolster strong market depth and sticky liquidity, ensuring to follow best industry practices and monitoring the efficacy in real time.

Next Steps

Assuming a passed deployment vote, we will coordinate with BGD to begin the Aave deployment process and implementation. We expect this process to take roughly four weeks. After the subsequent launch of Aave V3 on Metis, we will monitor the activity and launch the aforementioned liquidity mining incentive program. We will continue to stay in close communication with Chaos Labs and Gauntlet to keep a watchful eye on liquidity levels and inflows, to ensure proposed increases in market caps, congruent with increased liquidity depth on-chain. We look forward to the opportunity to collaborate with and provide value to both the Aave DAO and community at large, as well as the entire Metis ecosystem.