BIP-82: Emergency Proposal: Sonic maBEETS LST

Proposal

Launch maBEETS on Sonic utilizing an 80/20 BEETS and Beets-managed Sonic LST pool.

To align with the planned Sonic mainnet public launch timeline, this proposal has been set up as an Emergency Proposal with adjusted discussion and voting periods of 24 hours each. Otherwise the proposal could potentially not conclude before the launch of Sonic public mainnet and thus delay the maBEETS deployment.

Motivation

This proposal serves as an update to the previously approved BIP-78, which outlined the implementation of maBEETS on Sonic using an 80/20 pool pairing BEETS with wrapped S. BIP-78 also noted that transitioning to an 80/20 pool with the Sonic LST would be considered in the future.

The initial rationale for not pairing maBEETS with the LST from the start included:

1. Limited initial liquidity for LSTs on Sonic.
2. Potential delays in LST deployment.
3. Safety concerns surrounding a newly introduced token.

Since then, key advancements have addressed these concerns. With the successful passing of BIP-80, the Beets-managed Sonic LST underwent a comprehensive audit by Spearbit, a leading smart contract auditor that also reviewed the SFC contract used for S-staking on Sonic. The audit identified no high-risk issues, significantly reducing safety concerns. The final audit report will be shared with the community soon.

Additionally, the Sonic LST will now be available from the start of the Sonic mainnet public launch, eliminating deployment delays. Through strategic partnerships, we’ve also ensured substantial initial liquidity for the Beets-managed Sonic LST on Sonic.

Given these developments, we propose launching maBEETS on Sonic with an 80/20 pool pairing BEETS and the Beets-managed Sonic LST from the outset. This pairing not only enhances safety and liquidity but also positions the LST as a more robust and strategic option for the Sonic ecosystem compared to wrapped S.

Impacts/Risk Assessment

This tokenomic change offers significant advantages for both maBEETS stakers and the Beethoven X DAO. Stakers will enjoy higher yields from their positions, thanks to the enhanced earning potential of the liquid staked token (LST). Simultaneously, the DAO benefits from increased protocol revenue, driven by the LST protocol fee and the yield-bearing capture fee on the DEX.

The integration of the BEETS-managed LST on Beethoven X also sets a compelling example for other protocols to adopt and leverage the LST, amplifying its impact across the ecosystem.

These adjustments do introduce potential risk vectors through additional exposure to LST smart contracts. However, these concerns are mitigated by the successful completion of the corresponding LST audit.

Specification/Execution Plan

With the passing of this BIP, maBEETS on Sonic will be launched utilizing a 80/20 pool pairing BEETS with Beets-managed Sonic LST.