Please find the proposed SIP here:
Long form description and motivation talk can be found here:
https://twitter.com/SovrynBTC/status/1752724261532270609
12 Likes
I think itâs reasonable to implement SOV rewards for stakers at the presented rate.
Is there an end date for new stakes eligible for these rewards?
Of course, this will also depend on how popular these rewards are. But perhaps it makes sense to define a clear period in advance during which new RSK stakes can benefit from this. 3 months? 6 months? A certain number of staked SOV?
3 Likes
I am all in for rewarding SOV max stakers with 9%. Even more. They are vital part of the ecosystem, they must be rewarded.
For me in order to Vote YES, I would like an answer to the following questions:
- Total circulation of canonical SOV, Rootstock SOV, Ethereum SOV will remain 100,000,000 and there are no plans in increasing the circulation?
- Those who have liquid Rootstock SOV, ESOV will be able to transfer their assets on Day 1 when BitcoinOS goes live?
If the answer on the above is YES, then my personal opinion is the whole community will back this SIP no matter the status of SOV (stake,liquid,pool) one has.
5 Likes
I donât know what the correct timeline is. I think we could look to monitor effectiveness and make a decision. As written, it is open ended. We could make it 3/6 months extendable.
1 Like
There is no intention and nothing in this SIP to propose or suggest a change to the cap of SOV.
4 Likes
Is this proposal interfering with SIP24 rewards?
Means a staker being / still getting SIP24 rewards and extends by this proposed new rewards is cut off from either of them? Or should both reward programs be seen independently from each other?
I donât have that data, but Iâm sure your intention is to not only gather new stakers, but also have already running stakes being extended, of which many are still in SIP24 schedule.
2 Likes
Will rSOV stakers be earning rewards from other chains and BitcoinOS? I only ask, because it would suck to stake for 3 years and then BitcoinOS and other chain integration collects all the rewards, while RSK becomes a ghost town.
Plus, RSK stakers will continue to pay ungodly fees for collecting rewards. For small stakes, even with the subsidies, it might be beneficial to wait just to save on fees.
Does it not make sense to figure out what SOV looks like on other chains/BitcoinOS first?
Also, does it not make migration to other chains/BitcoinOS more difficult having long term stakers on RSK? If they stake for 3 years, does that mean RSK Sovryn will have to be maintained until stakes complete?
I guess itâs hard to understand any of this without clarity of what is planned for SOV on multichain/BitcoinOS, would be nice to mull this over in a separate forum post or discord chat until their is a reliable answer. IMO.
If Sov is being marketed as a solid interest bearing product, where people can put their hard earned money to gain a yield, then they should have as much information as possible to make an informed decision. Especially when subsidies are being used to try to force the decision.
Beyond that though, subsidies worked in the past. It seems a useful tool. I appreciate the time you have put in to this SIP.
5 Likes
Thank you @yago for putting this together.
One question just that I understand it correctly: We are getting SOV rewards on RSK that are then automatically moved to other chains via a bridge? Or are we minting SOV directly on other chains? Or is there SOV moved to other chains that are then the source for the rewards?
As for the cutoff date - will this be like the sunsetting of SIP 24 where we get less and less rewards until its phased out completely?
I am not sold on the total effectiveness just judging my own personal feeling here. Lets say we have a working BOSS at end of year and really takes off that might mean huge rewards by year 2. Having most OGs stuck on RSK for another year are we then increasing the rewards to match these? Or are we then having a path to move over our stakes completely? or is the only SOV on BOSS the rewards SOV so we can stake there and get all the fees anyway until our RSK stakes run out?
2 Likes
I too think that this projected path of going forward deserves more details before any incentives are thrown at staking.
1 Like
That is great Yago, thank you for clarifying that there will not be any increase in the circulation. Can you provide some more explanation how the transfer to the other chain is going to happen? Is it going to be 1:1 and available for everyone who holds SOV to move to the new chain from Day 1 when BitcoinOS is officially out?
2 Likes
100% Edan, solid proposal and stakers are vital to the ecosystem, thank you for your time on this one.
1 Like
Iâm starting to get a little confused by the use of âSOVâ. If I can call SOV on Rootstock ârSOVâ, and SOV on BitcoinOS âbSOVâ, I understand the proposal as follows: SOV stakers receive as rewards rSOV that effectively stays non-transferrable on Rootstock forever; however when BitcoinOS launches, the corresponding amount of bSOV will be issued to the SOV stakers and that bSOV will be transferrable. As the rSOV given as rewards to stakers are forever locked on Rootstock, we can consider them effectively burned, and in this way the circulating supply remains constant (supply becomes transferrable rSOV + bSOV). Have I understood the proposal correctly, or am I misunderstanding something?
Questions:
- The proposal says: âThe max SOV reward rate will be set at 9% for max stakersâ. How should I read the first âmaxâ in that sentence; does it mean that the rewards can go up to 9% but also be lower than that if more people stake? Or is the intended meaning âThe SOV reward rate will be set at 9% for max stakersâ?
- Is the SOV that will issued on BitcoinOS the only SOV that will ever be minted on BitcoinOS? (Or, in the terms I introduced, is the total supply of what I called âbSOVâ much lower than the total supply of rSOV now?) Or will there be additional ways in which rSOV can be moved over to BitcoinOS as well?
- I can see how this works for getting SOV to BitcoinOS without penalizing stakers, but how does the proposal cover the plan for Sovryn to launch across chains? Multichain will need bridges, I take it?
I think evaluation of proposals is best done against possible tweaks to Yagoâs proposal. Iâd be curious to hear what community members think of the following alternative:
Tweaked proposal: (1) create a general burn+issue mechanism: an option to burn SOV on Rootstock to get SOV on BitcoinOS issued to a specified address; (2) create a migration period at which the fee for early unstaking is set to 0. Give the additional SOV rewards as per Yagoâs proposal, and let it too become transferable (on Rootstock) during the migration period.
Motivation for this alternative. Arguably, some way to get the rSOV from Rootstock over to BitcoinOS will anyway be needed. Why? Because it seems to me that otherwise the SOV that remains on Rootstock (staked, but also used in AMM pools and other DeFi applications) risks being devalued the moment the SOV has been issued on BitcoinOS (as none of this rootstock SOV is still a gateway to the SOV to be issued at non-Rootstock places, the value created no longer applies to the old SOV); potentially destabilizing the Sovryn Dapp on Rootstock. I think we should avoid this at all cost, Sovryn on Roostock is a thing to preserve as best as we can.
As there would be a migration period during which early unstaking incurs no penalty, there is a lower bar to staking while having increased the rewards (with Yagoâs proposed SOV rewards), thus helping with the potential worries that Yago identified (regarding the focus on Rootstock Bitocracy, security and network participation and incentivizing growth). Iâd say this alternative meets these objectives better: as doing it this way means that the incentives for SOV existing elsewhere will continue to spread around across chains, also back to Sovryn on Rootstock. It is also more flexible, covering potentially both the move to BitcoinOS as well as the plan to go multi-chain (which, again, will anyway require bridges, I take it): create a migration period where stakers get to unstake without incurring a penalty and move their SOV, regardless of whether it is through reissue or bridges, regardless of where the SOV is moved to. With the dual strategy of introducing BitcoinOS as well as going multichain, I think we need a single flexible and easy to understand migration procedure that could apply across the board.
7 Likes
I believe this is explained by yago, it will be the same mechanism as SIP 24.
Is it not the idea to go multichain with SOV? So SOV will exist on Rootstock, but also keep existing as eSOV and also on BitcoinOS and hopefully other chains?
However never exceeding 100m tokens in total over all chains.
And hopefully freely transferable between all chains at all times.
or is this to much hopium?
2 Likes
THIS. I think Martin outlined it perfectly in the other forum post as well. bridge over when BOSS is ready. No unstaking penalty for longtime stakers to for the purpose of moving their tendis over to BOSS (or wherever). I think this should be set in stone BEFORE this SIP. So people know what they are getting before making the decision to stake for max time.
7 Likes
Or at least say âNo that will not be happeningâ so people can make there own decisions before committing to 3 years.
1 Like
There seems to be a lot of confusion about rSOV on Rootstock and SOV on BitcoinOS and so-called transferring.
As I see it, there is only one sensible way to transition canonical SOV to BitcoinOS. At the same time, itâs the simplest, most obvious, and fairest way to do it.
The Plan
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Set a specific timet for the transition.
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When the transition time arrives, the ownership of all SOV on Rootstockâincluding liquid, staked, and vesting SOVâis recorded.
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Using that record, the exact same allocation is made on BitcoinOS to the same addresses thereâliquid, staked, and vesting. Thatâs it.
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The rSOV held on Rootstock at that point remains exactly as it was, with all the original ownership and abilities it had continuing as before on Rootstock.
Implications
This essentially creates a spin-off protocol. A Bitocracy will remain on Rootstock that will continue to govern and claim rewards on Rootstock. But now there will be a copy of that Bitocracy on BitcoinOS. Anyone holding SOV in Rootstock at the time of the spin-off now has a share of two protocolsâRootstock Sovryn and BitcoinOS Sovrynâand anyone staking SOV now has voting power in both. Over time the two Bitocracies will diverge as people buy, sell, stake, and unstake.
If either SOV or rSOV moons or dumps due to this transition, it doesnât matter because SOV holders/stakers/vesters are holding/staking/vesting both. This is similar to the bitcoin fork to BSV. BSV turned out not to be worth much, but everyone holding bitcoin at the time was holding both bitcoin and BSV after the fork. So the total value didnât decrease.
Because it grants SOV in the exact same state it was in on Rootstock, it retains all the same economic entailments as it had before. Doing anything else seems unfair. For example, granting liquid SOV to users who had vesting SOV would suddenly unlock SOV that was earned under the condition of being locked for a period. That would be an advantage to the user receiving unlocked SOV but a disadvantage to all other SOV holders.
There is no need for a bridge or a transfer. In fact, bridged SOV would make no sense because that would make the underlying ârealâ token remain on Rootstock.
Non-Transferability
Yago proposed that rSOV rewards be non-transferable. Heâs not talking about not being able to bridge to BitcoinOS here. Heâs talking about not being able to sell or transfer the funds out of the rewards contract.
That is, he wants to ensure that rewards are actually rewarded to the stakers who earned them and are used to grant liquid SOV in the same amount on BitcoinOS to those stakers. So earned rewards will be locked in a rewards contract. They canât be dumped either. When the time comes to issue SOV as I outlined above, at that time rewards rSOV on Rootstock would be issued as liquid SOV on BitcoinOS to the same addresses. (I assume these rewards rSOV would also become liquid at the same time on Rootstock.)
6 Likes
While I wish there was a way to keep it one SOV sharing the 100mcap, I do agree it is the fairest suggestion this far.
Simple, fair, wonât tank token price (fairness to speculators), wonât screw stakers, and immediate clarity.
I wish other team members would chime in and comment on what they think, (pros, cons, alternatives if they protest).
I realize they are busy building and this might seem trivial, but a quick comment would put a lot of us in a better place confidence wise, especially with the current price appreciation.
Hopefully this gets some eyes.
Thanks @one_digit
1 Like
Thanks for your comments.
In your first paragraph, is your concern that there will be 100M SOV on each chain? Since theyâre on separate chains and only function on one chain, they wouldnât have dilution effects other than Rootstock Sovryn possibly having similar functions to a Sovryn protocol on BitcoinOS.
2 Likes
Yes, essentially there would be 200m, right? I realize it wouldnât matter in the end. As you mentioned in your post, it would be like BSV and Bitcoin, and eventually one would beat the other out.
I do agree with you though, because I see the benefit of RSK Sovryn needing to be continued.
What of the issue that rSOV depreciates greatly and it creates an easy way for bad actors to goble up cheap coins for VP? Maybe the subsidies provided will help protect that from happening?
1 Like
Yes, 200M total. But two parallel systems (at first).
It might take awhile for liquidity to build up on a BitcoinOS Sovryn rollup. Or, there may be reasons that it wonât catch on. Rootstock Sovryn would continue. If it became so worthless that bad actors gobbled up cheap coins for VP, then I donât think anyone would care. Another option would be for Bitocracy to vote to make all contracts immutable. Theyâd continue to get revenue, but there would be no changes that could be voted for. This might be palatable if itâs still mostly the same people who form the BitcoinOS Sovryn Bitocracy and that has become very successful. Iâm just wildly speculating at this point.
2 Likes