[Migration] What should Migration #7 look like?

Question:

Which Style Migration Should Unifi Offer as Migration #7?

Further descriptions of each choice can be found below.

Choices:

1. Lottery
2. Fixed amount of UNFI per blockchain
3. Proportional based on the redeem value of UP on each chain
4. Proportional based on the market value of UP on each chain
5. Only liquidity providers can participate in migration

Introduction:

The UNFI referendum process is designed to allow Unifi to gather information and take guidance from the UNFI community. This is an integral part of the UNFI Global Governance Model (GGM). Referendums ensure that only UNFI holders have a voice in the discussion about the listed topic.

Core Referendums are intended to be a non-binding way for Unifi to take guidance from UNFI holders. However this Core Referendum will be considered binding by Unifi. UNFI holders will determine which style of migration will occur in migration #7.

Background Information

Migration was chosen as a term for the process of giving liquidity providers access to the UNFI Global Governance token. This term reflected the intent that there could be many potential ways to accomplish this access and move from UP to UNFI. It wouldn’t just be a simple ‘conversion’ process. The Migration Madness event is a series of migrations designed to gather additional data on the types of migrations preferred by the UNFI community. It also allows the community to have more migration data to analyze when making governance decisions on future migrations.

Migration #7 has the potential to try some migration styles which might be more difficult to model. It will reveal if UNFI holders wish to adopt one of the existing models of migration, or continue to try different methods and gather more data.

In a previous Core Referendum, UNFI holders identified the impact of migrations on the market price of UNFI as an important factor. To mitigate this risk, Migration #7 will be a maximum of 1000 UNFI. This should also allow UNFI holders to vote for their preferred option, without excess concern of a UNFI market price impact.

Each choice that can be voted on is explained below. An announcement of the winning choice will be written with full details on how the migration will work.

What choices are being proposed?

Below is a summary of the available choices. Additional details will be added to the announcement of the winning choice.

Choice #1 - Lottery

A lottery style migration could be accomplished by Unifi choosing 20% of Ethereum destination addresses that participated in the migration. All UNFI for this migration would then be claimable only by those chosen addresses.

Considerations: Some migration participants could receive much larger sums of UNFI than with other proposed systems. Some migration participants that migrate UP would receive no UNFI.

Example: From all blockchains where UP was contributed, there were 100 Ethereum destination addresses supplied. Unifi would select 20 addresses to split the 1000 UNFI. Each of those 20 addresses would receive 50 UNFI. All other supplied Ethereum addresses would receive no UNFI.

Choice #2 - Fixed amount of UNFI per blockchain

A fixed amount of UNFI per blockchain style of migration could be accomplished by allocating a predetermined amount of UNFI tokens to migration participants on a specific blockchain. On each blockchain, the amount of UNFI claimable by each participant would be proportional to the percentage of the total US dollar equivalent value (USDEV) of all participating UP on that chain. USDEV would be determined by that chain’s UP redeem value.

Considerations: Migration participants on different blockchains may see a result that is significantly different from migration participants on other blockchains. This could be a benefit to UP participants on blockchains where there is less UP in existence.

Example: The 1000 UNFI would equate to approximately 142 tokens per each of the 7 blockchains. All migration participants on Ethereum would share the 142 tokens in proportion to the percentage of that blockchain’s UP they contributed.

Choice #3 - Proportional based on the redeem value of UP on each chain

This migration would be in the same style as migration #5, the most recent event. This article can be referenced for further information on this style of migration. The migration style described in the article would be adapted to migration #7.

Considerations: This choice has been used as the standard for multiple migrations. The outcome could be more predictable based on historical trends.

Example: An example can be found near the bottom of this article.

Choice #4 - Proportional based on the market value of UP on each chain

This migration would be in the same style as migration #2. This article can be referenced for further information on this style of migration. The migration style described in the article would be adapted to migration #7.

Considerations: This choice was used as the for migration #2. The outcome could be more predictable based on historical trends. Complaints Unifi received on this style of migration were:

• It caused unpredictable or unsustainable fluctuations in the market price of UP
• It was subject to market price manipulation by large holder or coordinated groups
• It required a longer time between the close of migration and UNFI being claimable
• It created an emphasis on the market price of UP, which encouraged purchasing UP instead of earning UP by providing liquidity

Example: An example can be found near the bottom of this article.

Choice #5 - Only Liquidity Providers can participate in migration

In this style of migration, the amount of UP allowed to be contributed to the migration would be equal to the amount of UP claimed by that participating address. Note: an address would only have been able to claim UP if they provided liquidity. UNFI would be distributed to migration participants on all blockchains in proportion to the USDEV of UP based on its redeem value.

Considerations: This style of migration has not been used before. It would likely require an extended processing period between the close of migration and UNFI tokens being claimable. Since this would be an experimental migration, minimal development time would be available to create this system. This means user safeguards or information sources may not be available. Participant self-education and blockchain explorer knowledge could be required to successfully participate in this migration. UP token loss could occur if a participating address contributed more UP to the migration than the participating address had claimed as a result of providing liquidity.

Example 1: A BSC migration participant used an address where they provided liquidity and claimed 5 UPbnb. That address contributed 5 UPbnb to the migration. Each UPbnb would have its redeem USDEV determined. That migration participant would be able to claim an amount of UNFI in proportion to the total amount of redeem USDEV received from all blockchains.

Example 2: An Ethereum migration participant used an address where they purchased 1 UPeth from uTrade. The participant had provided enough liquidity with that address to claim 0.5 UPeth. The participant contributed 1 UPeth to the migration. The participant would be able to claim UNFI for the redeem USDEV of the first 0.5 UPeth. The second 0.5 UPeth would be burned, but would not generate any claimable UNFI.