[BSP:03] $BIFI Migration

TLDR: A non-binding signalling proposal to gauge support for a plan to promptly migrate our $BIFI token away from Multichain. Core proposes that $BIFI is redeployed on Ethereum, with a single universal governance pool, and the capability to bridge staked $mooBIFI tokens via a new bridging solution managed by the DAO.

We urge all users to immediately break any existing liquidity pool positions involving our $BIFI token.

Background

Over the last 2 months, Beefy’s bridging provider Multichain has suffered a series of critical failures affecting all assets issued and supported by their protocol. In the latest incident, c. 18,690 $BIFI tokens were moved from a Multichain router to another wallet controlled by Multichain, without Beefy’s prior knowledge or consent. This leaves a shortfall of backing for bridged $BIFI tokens (i.e. tokens not on BNB Chain).

Having become aware immediately of this movement, Beefy’s Core team sought details from Multichain. Though Multichain have confirmed that the recipient wallet is a Multichain wallet, but have not confirmed if it is currently controlled by their team, it has not provided any further context or reassurance as to the nature of this action. As such, Core now supports a complete and immediate migration away from Multichain.

As a preventative measure to avoid financial harm to our users, we are now recommending that all users break any existing liquidity pool positions involving our $BIFI token. With the shortfall in backing for bridged $BIFI, we recognise a significant risk of volatility in the token’s price and supply, leading to a likelihood of material impermanent loss for LP positions.

Migration

The full details of our migration plan are still being finalized, and a binding proposal and vote will take place if this signalling proposal finds support. Nonetheless, our outline has several core components:

Firstly, with the shortfall in backing for bridged $BIFI, we cannot effect a migration without Multichain returning the full outstanding balance. Instead we are proposing to redeploy $BIFI as a new token, to be distributed (whether by airdrop or otherwise) to holders of $BIFI on every chain. At this stage, we are proposing that the new $BIFI token should be deployed on Ethereum as its new home blockchain

Only $BIFI which is held in bridging contracts or the above reference Multichain wallet will be ineligible for the new distribution. All other $BIFI holdings on any chain will be recognised by the snapshot, though distributions of a new token would take place on a single chain. A public snapshot date will be agreed, allowing all users to decide whether or not to hold $BIFI and participate.

Secondly, we propose a complete redesign of our bridging process, whereby the native $BIFI token will be controlled by Beefy DAO, and issuance of any bridged copies will be handled by messaging protocols rather than by bridging. This could include multiple external service providers to avoid further reliance on individual providers.

Finally, we also propose a redesign of the current $BIFI governance pools. Though staking $BIFI on each chain is useful functionality, the Multichain situation has shown that this can present additional risks. When combined with the cost of hosting liquidity on each chain, the inequality of governance pool and the negative externalities of encouraging bridging between different chains for yields, we believe that a redesign of the system to implement a single universal governance pool would be advantageous. Core has also considered bridging staked $BIFI tokens ($mooBIFI) to other chains, to allow access to governance pools yields on any chain.

Further details will be released as they are finalized by Core.

Signalling Proposal

This proposal is being issued in advance of a full proposal, to gauge sentiment for the Core team’s plans. As a signalling proposal, the result is strictly non-binding and solely for the purposes of informing future governance direction. Holders are encouraged to vote even where their opinion is not firmly one way or another.

Should the proposal find favor, the Core team will aim to issue a full detailed proposal within a matter of days. All discussions are welcome on Beefy’s social media sites, with central discussions taking place in the #🏛-proposals channel (in the specific thread for this proposal) and the #💡-proposal-ideas channel on Discord.

Proposal

Beefy should immediately and completely migrate its $BIFI token away from Multichain and implement an alternative solution in line with details of this proposal.

Choice 1: For Migration

Choice 2: Against Migration

Choice 3: Abstain