Second Envelope - Lobis: The Body
0x05Ce
November 27th, 2021

Intro

In the First Envelope, we explored the purpose and values of Lobis. Since then we have launched and taken the first steps towards building a better future for us all.

credit: aleks#1295
credit: aleks#1295

The first 72hrs

Pathway to decentralized decision making

Having an allocation for team members, VC’s, influencers or other investors would mean that insiders control Lobis. It would also enable external entities to centralize control and provide an outsized risk to LPs.

Clearly, this would be to the detriment of our independence and to the vision of DeFi. We could not lock Lobis in golden chains. We could not reconcile with such actions.

We proposed that there would only be Lobis, Olympus, and the community. This is what we did to make it happen.

We made Olympus and the OHMies our largest community members. True to our word an initial supply of 15,000 $LOBI was minted, 12,500 of these were sent to OlympusDAO with 2,500 set aside for the airdrop.

OHM

As per OIP-44, Olympus DAO provided initial liquidity for Lobis by pairing 6000 OHM ($5m) with 12,500 $LOBI tokens providing total liquidity of $10m on the LOBI-OHM Sushipair.

Following launch a frenzy of transactions quickly led to the oracle price of $LOBI to rise significantly, settling today around $2650.

At the time of posting the 12,500 $LOBI tokens sent to Olympus increased the backing of OHM by $33,000,000. Poetic.

The favorable DAO swap (towards Olympus) proposed in OIP-44 was realized. With Olympus DAO and OHM benefiting in 1 day from a net increase in backing by $27,000,000 without the emission of OHM.

The first-ever DAO token swap at launch of its kind and possibly one of the most profitable DAO trades ever.

Not bad for a first day — long may it continue.

The Sushipair has had over $90,000,000 in tx volumes generating over $295,000 in trading fees for LPs. As the majority LP on the pair (>80%) Olympus has benefited from the majority of these fees.

The LOBI-OHM pair was trending on Sushiswap generating one of the highest transaction volumes on November 23 — one for the history books. With pool utilization somehow at over 400% for the short history of the pair.

As of today Lobis has sold over $4m in bonds, $1,700,000 of LOBI-OHM, over $1,800,000 of FXS and $2,240,000 of CRV, totalling to $5,600,000. Faster than Yearn and Stake DAO for this period, combined. Another record set by Olympus and Lobis.

As a result, of the 1.1% bond fee hard coded into the Lobis contracts Olympus has received 42 LOBI ($111,300).

Symbiotic


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Did you hear, we’re doing an airdrop?

All airdropped $LOBI has been staked on your behalf to save on gas fees. The airdrop is underway and below you can find further details about it in our Official Notice - Into the Nether.


credit: fishballs4#7309
credit: fishballs4#7309

Current mechanisms.

$LOBI

Our protocol is governed by the $LOBI token. Each LOBI token is backed by a basket of governance assets (currently CRV and FXS, but more following decisions by the governance) in the Lobis treasury, giving it an intrinsic governance value and utility. By staking $LOBI in exchange for sLOBI, users can (|||,|||), participate in governance to determine any part of the Lobis protocol and more importantly participate in the governance of all of the reserve’s underlying platforms, while profiting as Lobis’s reserve size increases.

Staking

Staking is the primary value accrual strategy for Lobis. When users stake, they lock $LOBI and receive an equal amount of sLOBI, which are transferable and therefore composable with other DeFi projects. Unstaking your sLOBI will forfeit your upcoming reward rebase, governance rights and provide you with LOBI tokens.

Stakers earn rebase rewards by staking $LOBI on the app. The rebase reward is derived from the proceeds from bond sales and can vary based on the number of LOBI staked in the protocol and the reward rate set by monetary policy.

Staking is considered a passive, long term strategy, (|||,|||). The increase in your staked sLOBI translates in a constantly falling cost basis, meaning that, given a long enough staking period, the increase in sLOBI balance eventually outpaces potential price volatility.

Bonding

Bonding is Lobis’ secondary value accrual strategy. It allows Lobis to acquire governance tokens (CRV, FXS, and more in the future) and its own liquidity by selling LOBI at a discounted price compared to the market. This offering brings enormous benefits to the users. Firstly they can benefit from an active, short-term strategy by buying LOBI tokens at a discount and profiting after the vesting period. Secondly, since Lobis accumulates its own liquidity (POL), it ensures there will always be locked exit liquidity in the trading pools to facilitate market operations and protect token holders.

Moreover, when a bond enables to increase the reserves of the DAO, a new LOBI is minted and distributed to sLOBI holders. The minting rate is 1 LOBI for each voting point of the governance token or LP token bonded. A voting point corresponds to the voting right associated with one governance token and multiplied by a Reserve Scaling Variable which targets equally profitable bonds.

(This is where the 1.1% fee for Olympus comes from!)

Code

All Lobis code including contracts and front end has been open-sourced and is available here. Anyone is able to iterate on top of the deployed code via GitHub projects.

The governance process around whether this code should be integrated and considered to be part of the DAO is explained below.

It’s important to note that anyone can build on top of Lobis, there are no restrictions or prerequisites. See something you don’t like? Change it.

The governance process is only for:

  • Applying for code submissions to be considered as part of the architecture of Lobis.
  • Submitting proposals to the DAO to request anything that is needed to support the code, developers or changes proposed.

If you have an idea or want to build on top of Lobis just create a project, define the requirements and submit a PR.


"The few" circa August 2021 (before Lobis) | credit: eiro3636#4152
"The few" circa August 2021 (before Lobis) | credit: eiro3636#4152

DeFi Governance - Redefined.

Together, we have designed a new form of the Olympus bonding mechanism, designed for the many, not the few.

We believe in strengthening DeFi by enabling more voices to be heard, a place where each user in the ecosystem can find a policy based on their values and goals. A multitude of different like-minded groups increases the utility received by the users, resulting in the growth and betterment of the ecosystem as a whole, and to the benefit of all groups involved.

Normalizing the idea of alliances that work in tandem to promote and grow protocols, not against them. Building more robust protocols, together.

Lobis even has the power to breathe new life into the ecosystem. Imagine a project abandoned due to failing governance, our community can provide public goods in the form of DAO tooling and freelancers to fix what was just “not quite right”.

Looking inside

We took an open-source mentality to govern ourselves. Lobis is a court where everyone has a voice, for or against. Freedom of speech is an important part of a fair and equitable system. What really happens when you enable 5,000 degens to build the future of DeFi governance?

Join us to find out.

In the short time since our genesis, we have already onboarded engineers, creatives, economists, and global communities for Chinese, French, and Russian Envoys.

But ser, how do we govern?

Lobis Improvement Proposal (LIP): A proposal to execute on any power delegated to LOBI holders or outside the scope of delegated powers of sub-daos.

Examples: formalize a new sub-unit and assign it power; Do anything outside the scope of proscribed powers, like change budgets, branding; revoke delegated powers from sub-daos; vote on new Emissaries; mint a new power, etc.

Tooling

  • Forum: A place to come together, share ideas, brainstorm, and debate.
  • Notion: Coordinate, track and submit the implementation of instructions as specified in Approved Lobis Improvement Proposals.
  • Vote: The place for our community to ratify decisions on-chain.

The protocol is maintained by various independent developers or "Envoy’s" of Lobis and governed by sLOBI holders.

Since the inception of Lobis, we have fostered a sub-dao structure encouraging the development of autonomous sub-dao’s consisting of freelance contributors.

Today these are fluid groups specialized in different but broad functions that help to make Lobis what it is. The intention is that these sub-dao’s execute day-to-day tasks as set out in LIP’s - Lobis Improvement Proposals that are approved by the community on our governance platform.

The sub-dao’s comprise various independent freelancers that execute tasks based on the instructions or laws specified in LIP’s and voted on by the DAO community on our snapshot.

Sub-dao’s are small, autonomous groups of freelancers empowered by LOBI holders to act independently in the best interest of Lobis within a specific domain of action and with discrete decision-making powers.

Each sub-dao will be organized around a group of Emissaries. The Emissaries for each sub-dao should be nominated by rough social consensus and be reasonably acceptable to the community.

It is important to note that sub-daos are not the only teams that can work on Lobis. Each of the current sub-dao’s emerged based on need as freelancers grouped around a specific cause.

More informal contributors are encouraged to join, alone or in groups, seeking to have their contributions ratified by LOBI holders on a granular basis; after the fact. These informal groups may also submit proposals to the forum to formalize their sub-unit.

Some of the existing sub-daos and their purpose is as follows:

  • Engineering - Build, maintain and decide what code is part of Lobis.
  • Policy - Determine policies for BCV, RFV, fees, etc.
  • Marketing - Share the message of Lobis.
  • Design - Represent and shape our identity in media
  • Community - Cultivate community and foster collaboration.
  • Operations - Design mechanisms to enable our community to execute.

Sub-dao’s and the community; how does it work?

As of today, the community holds decision making powers for

  • Managing sub-dao Powers: sLOBI Holders can vote to create, assign, or revoke discrete powers to or from sub-dao's.
  • Change Emissaries: sLOBI Holders can vote to change sub-dao leads or ‘Emissaries’.
  • Formalize sub-dao's: sLOBI Holders can formalize or deconstruct sub-dao's to control which sub-dao's can hold delegated powers
  • Spend Treasury Funds: sLOBI Holders can choose to spend funds from the treasury
  • LIP Power: sLOBI Holders have the power to propose a LIP on anything not already delegated.
  • Set Budgets: sLOBI Holders Policy can create budgets for grants, freelancers, operations, or other workstreams

As we progressively decentralize the current core team has transitionary powers to act in the interests of the protocol until a set of sub-dao delegated decision-making powers covers all needed transactions, actions, or processes. These powers are in place for 3 months starting on November 27 and running until February 27.

Examples of these are:

  • Emergency Powers: Immediately intervene in case of attack or bug to shutdown or roll back on-chain DAO functions.
  • Veto Power: This power allows the Multisig to spike any decision to the community and is an emergency measure in place in case of existential risk to the DAO.
  • Execute tx’s: This power allows the Multisig to execute on-chain tx’s pertaining to the instructions from the community in LIPs e.g. deploy a new bond or spend the treasury as per a LIP.

The Multisig is currently comprised out of the team that has built Lobis so far @exaltedemissary#5165 @platone#5568 @icecube#8197 @lobbyist#7319, @heaume#0327, and @usgovtbonds2#0856

The community can submit requests for information or requests to change any of the powers stated above.

LIP’s - How does it work?

GuidelinesThese are instructions for any member of the community for getting ideas to LIP’s that change any part of Lobis. These are foundations that the community or operations sub-dao can propose to modify.

  1. Write down your idea and share it with other community members in the relevant Discord Working Group e.g. An idea to make custom emojis would work well in the #Design-general.

  2. Refine the idea, gather support from the community and write it down into the “Draft-Proposal” format as specified here.

  3. Share the “Draft-Proposal” on the Lobis Forum here and add tags for the relevant working group. After 3 days tag one of the Mods and they’ll validate that rough consensus has been reached.

  4. The next step is to create a “Formal Proposal” the mod will share this template for “Formal-Proposals”. This is a more detailed template to specify instructions for the DAO and sub-dao’s.

  5. Tag one of the Mods and they will qualify that the proposal meets the criteria and the proposal can be shared with the community on Discord and Twitter. The “Formal-Proposal” is open for comment for a grace period of 3 days.

    If a proposal is time-sensitive this must be specified on its posting and qualified via a signaling vote on the forum via a soft poll.

  6. A mod qualifies whether the “Formal Proposal” has met the requirements and that the community has had the opportunity to comment. If yes, then the mod will assign it a LIP number and move the LIP for on-chain voting by the community using staked LOBI ($sLOBI) on Snapshot.

Approved LIP’s must:

  • Reach a quorum with at least 1000 sLOBI voting on the proposal.
  • Have a 3-hour time delay in between being posted on Snapshot and for voting to begin to ensure the community has enough time to be informed.
  • Be available on Snapshot for voting for 2 days without any exceptions.

If the vote is positive, the LIP will be added to the pipeline on Notion where the implementation of the task can be updated. The community can track the progress of LIP implementation here.

After the fact; a grant previously decided during the Formal Proposal process, will be proposed for work done to the relevant freelancer. Any completed grants will go on the profile of the freelancers and contribute to their reputation. In the future, a vote delegation system could be implemented where the community can delegate sLOBI voting power to freelancers that consistently demonstrate the power to execute and good faith to the community.

To make adoption of the governance process easier there are some proposals and tasks ready for comment and contribution.

For example, all images in this envelope come from the community, born out of our Draft Proposal: creating branding and media content.

Or our Draft Proposal: creating a dune dash for Lobis.

We hope that this can be a good test run to evaluate the robustness of beta governance, and it is our intention to enhance this process as new proposals go through this process.


credit: aleks#1295
credit: aleks#1295

Progressive decentralization roadmap.

Our ethos is centered on open source community-driven development. True to our manifesto we want to create frictionless mechanisms for anyone to be able to contribute and build out the vision. The protocol should not be reliant on an incumbent set of volunteers but rather continuously attract and be able to detach talent with minimal friction.

We have a two-pronged approach to progressively decentralize.

  1. Implement LIP’s from the community and empower freelancers to produce composable, compartmentalized features that can be put together and deconstructed endlessly.
  2. Decentralize voting through token distribution to those that (|||,|||) with the DAO by bonding and staking. These LOBI and sLOBI tokens can then be used to vote on proposals on

Therefore, Lobis is constantly evolving. What Lobis is today, may not be what it is tomorrow — what you do after reading this may change Lobis forever. It’s up to you.

||| Our Purpose ||| Our Values |||

If our values and behaviors reconcile with you, you can contribute today.

Join our discord, join the DAO.


What’s next?

In our next Envelope, we will recap how beta governance has worked and outline the next steps on how to enable users to retain their governance rights.

Please keep in mind that this is a beta release: and we the core team plan to iterate over the next few weeks as we receive feedback and implement further refinements. If you’d like to provide feedback, head to our new discord channel.

END.

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