BIP 38 - Funding of Reliquary implementation

Intro

Hey everyone

This proposal is to determine part of the implementation of the new fBEETs reliquary farm. There are two options to consider:

1. fBEETs holders will go through a period of 8 days where no farm emissions are earned.
2. fBEETs holders that have migrated to the new farm will immediately get emissions, these emissions will be provided by the treasury. Estimated to be between 250k-300k if BEETs.

Motivation

As a recap, the reliquary maturity model will soon be replacing the current fBEETs model. The Reliquary design ensures that over a period of time, both your farming and governance power grow as your relic matures. In Reliquary, the staked fBeets remain liquid therefore you can remove your stake at any time or sell your relic on the secondary market.

The implementation of the new model will see a change in how fBEETs earns its farm rewards. Currently, the Beethoven X: Masterchef mints BEETs on a per block basis and this is allocated to various farms. Example diagram below:

Once we have transitioned to the new model there will be a subtle change in this flow. The Beethoven X: Masterchef will always be the only contract able to mint BEETs, this will not change. BEETs that are scheduled to go to the fBEETs farm will go to the Reliquary instead via an automated process.

Users will no longer receive fBEETs rewards through the Masterchef but through Reliquary. Here is an example diagram representing what the change looks like:

This change brings about a challenge around the initial implementation of the new model.

The “Reliquary” farm will need 8 days worth of BEETs in order to allow for a smooth and continuous flow post implementation. 8 days worth of BEETS allows for a regular harvest/transfer interval of one week and leaves 1 day of surplus emissions just in case.

The question is how to best go about it, this proposal looks to get approval of one of the following:

Option 1 - Turn off the fBEETs farm rewards for a period of 8 days and allow the new farm to fill up. While it is temporary, this will mean that for those 8 days there will be no farm APR on any of the fBEETs farms. This period of no rewards will coincide with the migration to the new fBEETS farm and relics, so it can be seen as a call to action. During this period, users can migrate the staked fBeets in Masterchef to the Reliquary. It is important to note, that while rewards are off, your relic will still mature and when they are turned on again your rewards will be representative of your relic level

Using a timeline, this will look like:

1. fBeets will get reward until day (t)
2. fBeets Reliquary will get rewards after 8 days have passed (t+9 days)

**Option 2 - ** Use Treasury to frontload the Reliquary. This will allow farm rewards to continuously flow but the Treasury will only be able to recover the BEETs once we have come to the end of our emissions. It is estimated that it will require between 250k-300k BEETs for this purpose. For reference, at the time of writing, the Treasury holds over 13.5m BEETS so it represents just over 2% of the balance held.

Using a timeline, this will look like:

1. fBeets will get reward until day (t)
2. fBeets Reliquary will get rewards immediately after 1 has happened (right after)

It is important to note, that there will be a firm cut-off time where the Masterchef emissions will end and in both instances the current fBEETs farm will stop earning rewards when minting relics goes live.

Risks The main risk identified:

Option 1 - with no emissions on the new farms, users may not migrate but rather exit their position.

Option 2 - Treasury will only be able to recover the BEETs used once the masterchef has stopped emitting BEETs, this is just under 3 years away.

Impacts Option 1 - Nothing. Option 2 - Except for the Treasury ask, there are no other impacts.

Specification

Option 1 - Nothing. Option 2 - Treasury is to send BEETs to the fBEETs Reliquary farm. (Contract address still to be determined).

Execution Plan

Option 1 - Nothing. Option 2 - Once the fBEETs Reliquary farm is available, the Treasury will send the required BEETs to fill the farm .