QIP202: Migrate Locked QI LP to Ethereum

This proposal seeks to modify QIP198, which approved the implementation of aveQI.

Please see the QIP198 for additional context and a detailed description of the migration process.

Proposed changes

Migrate eQI to a QI-WETH LP on Ethereum, instead of forming a QI-WMATIC LP on Polygon PoS.

If this proposal is approved, QI will become native to Ethereum. QI on other chains will be bridged using official bridges. Users with QI balances outside of escrowedQI will be given new QI tokens based on a snapshot taken prior to migration.

Transaction fee considerations

Given varying transaction fees on chains, a few thresholds need to be put in place for QI’s migration.

• Threshold to receive QI-ETH position on Ethereum: 500 QI
• Threshold to receive QI on Polygon for eQI position on Polygon, instead of a QI-ETH LP on Ethereum: 50 QI
• Threshold to receive QI on each chain. 50 QI on all chains except for Arbitrum, Optimism, and Avalanche. Those chains will have a threshold of 75 QI.

QI holders must meet one of these categories to receive the new version of QI.

Motivation

Chain-specific risk: QiDao’s main LP and governance tool should exist on the chain with the highest degree of security and stability.

Ethereum has proven to be the optimal chain in this regard for the following reasons:

• The nakamoto coefficient for Ethereum is much greater than that of other chains and L2s. This makes sudden, unilateral actions improbable
• Having a large set of contributors and community members, changes to Ethereum are subject to much greater scrutiny and receive considerably more feedback

Addressable market: most activity on the blockchain currently exists on Ethereum mainnet, as does most of the blockchain’s total value locked. Moving QiDao’s main LP to Ethereum will significantly increase the DAO’s total addressable market, allowing it to onboard a larger community. Keeping QiDao’s core LP outside of Ethereum will only hamper the protocol’s growth.

Low project risk: WETH is a better alternative to an ETH liquid-staking token (LST), since it does not carry the project-specific risk that such a token has. LST projects are fairly new and carry far greater trust assumptions than WETH itself. These assumptions include lower decision-maker count, reliance on teams for secondary market maintenance, and additionally smart contracts.

Quorum Standard

The option with the most votes will be implemented.

Options

• Approve proposal
• Further discussions needed
• Abstain