GFP-1: Whitelist Guard/BUSD and Guard/USDT Pools on KnightSwap - Process

Final GFPs
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Whitelist Guard/BUSD and Guard/USDT Pools on KnightSwap

Abstract

This proposal presents the idea to whitelist 2 KnightSwap (KS) LP contracts (GUARD/BUSD and GUARD/USDT). Due to BUSD support ending by February 2024, it is imperative that GUARD stable pair be switched as soon as possible.

Proposal Category

Process

About the Team

The KS team consists of individuals with a diverse skill set.

  • Wizard, Owner and Founder of KnightSwap. Runs a Development Firm that has full capability for Web 2/Web 3 projects from beginning to end
  • Frumpo/Lord Frumpsalot, Operations, Risk Analysis, Project Manager for KS. A Guardian of TGA.
  • RealJayDee, Backend Support Manager
  • V, Community Manager
  • Arrow, Graphic Artist

Motivation

Currently GUARD has a 1% tax on all transactions. This includes, buy, sell, transfer, and pairing/unpairing LP. This tax is a friction point for many current LP providers because they will be incurring 2x 1% tax transactions during the migration process; one for the unpairing, one for the pairing. By whitelisting these pool contracts, the 1% tax will not be incurred.

Benefit to Guardian Ecosystem

This will reduce a friction point thereby increasing the percentage of current providers migrating. This is very important because most LP providers are long term GUARD investors and to incur a 1% tax twice for an action that is in the interest of GUARD is counter productive.

In addition, future LP providers will also not incur a 1% by providing liquidity which removes one barrier to some users providing LP.

Rationale

Paxos has already halted the minting of new BUSD tokens. They will continue to be supported and redeemable through at least February 2024 Beyond that is uncertain.

Binance has also followed suit and withdrawals are disabled on their platform. All BUSD should have also been converted to FDUSD.

Link to Announcements

PAXOS will halt minting new BUSD

Notice Regarding the Removal of BUSD

Based on these developments, BUSD will be deprecated and phased out. There is no reason to keep the GUARD/BUSD pair. This only provides risk due to possible depegging. Depegging occurs when a stablecoin loses its underlying backing. In BUSD’s case, if Paxos no longer redeems BUSD, then BUSD has no value as the backing is no longer there.

To remove this risk, the GUARD stable pair must be switched to another pair. USDT is chosen as USDT has almost 4x the market cap of USDC according to coinmarketcap.com

Specifications

  • Smartcontracts
  • Knightswap

Steps to Implement

    1. Update Guard contract to whitelist 2 contracts
  • BNB Chain
    • GUARD/BUSD - 0xfC84B031a5221CED00b6470744aF5e5dA5710dDC
    • GUARD/USDT - 0xd55cbda67576e2620Cf4c869C031dC845502067D
    1. Wait 3 days for GUARD timelock

Note: Throughout each step, the KS team will provide updates on our Twitter and Discord announcements

Timeline

  • 1 day to whitelist contracts after proposal passing
  • 3 days for timelock to take effect

Overall Cost

0

14 Likes
2

Thank you @LordFrumpsalot for posting the first idea in the Guard Foundation.

Would you mind introducing yourself and letting the community know more details on why you brought this forward and how it can be achieved.

2 Likes
3

I agree with the necessity of this. I would propose this with an added incentive to the new pool(s) and discuss incentives for pools on other chains. (Arb and Polygon) I also am aware Polygons bridge is broken. (Maybe arbs as well?)

It’s crucial to get liquidity back in place, away from BUSD, but it’s also crucial to encourage those who remove liquidity, to put it back under the new USDT. Therefore, I think the incentive should be increased or discussed.

As I will be launching a project soon on Polygon, among others, it would be good to see guard have a sizable amount of liquidity there. (Correct me if I’m wrong in the bridges and other liquidity)

2 Likes
4

Sure! I’m Frumpo, Lord Frumpslot, real name Steven =)

The main reason I brought this idea forward is because BUSD is being deprecated or phased out, so all protocols are moving away from BUSD. Because Guard’s largest liquidity is paired with BUSD, it is crucial that liquidity providers switch their believe.

From what I have heard and seen in the different communities, there is a hesitancy to change any pairs right now due to the taxes from moving in and out of the BUSD/USDT LPs. Thus, my idea is to whitelist those contracts so users can freely un-pair and re-pair with the new USDT pair.

To accomplish this, after this idea discussion period, I will submit a formal proposal, get it voted, and we can get the change implemented.

10 Likes
5

I will discuss with KnightSwap team to confirm, but I believe we would be moving the multiplier from Guard/BUSD to Guard/USDT. Not looking at additional incentives at this time. I’m just thinking about removing the frictions for LP providers to switch pairs.

In terms of the liquidity on other chains, this is definitely an idea that can be discussed in future, but trying to keep this idea focused on the BUSD to USDT switch.

6 Likes
6

@Stash as @LordFrumpsalot alluded to he will have to discuss multipliers with the Knightswap team which is separate from GUARD foundation.

From my knowledge, the reason this particular change has to be proposed via GUARD fdn is that it requires a change to the whitelist in the GUARD token contract which concerns Guard fdn.

Any change to the multipliers for Knightswap is at the discretion of the Knightswap team and requires no input from the GUARD fdn community.

3 Likes
7

I second this as is idea.

I’ve learned from:

A. Being in leadership

B. Being part of a DAO previously,

That the more concise (binary) and thus simple an idea and ultimately proposal can be, the quicker it can be implemented.

In particular given the time horizon which is currently “February” (again things could change but this is the data we have now from Binance and Praxos)

AND if I recall the GUARD contract has a 3 day time lock on it for changes…we need to move efficaciously on this.

Let’s leave farming incentives to a separate GFP. Plus I believe that is a Knightswap (or whatever Dex desires to host LP) decisions…whereas the tax whitelist is a GUARD token issue and thus Guard FDN (unless I’m incorrect on the way the contract relationship works…but since @LordFrumpsalot put for this idea and he is on Wiz’s team and thus Knightswap I think he knows the technical path required on this)

Selfishly, I’ve brought a number of people into the GUARD ecosystem over the last 2 years and most of them are investors (they have forgotten about this project because they have a long time horizon and/or they may be less technically inclined).

So I know I’m going to need more than a couple of days (ie not end of month) in order to help them all transition LP.

I’d like to see this implemented in the next week so we have 2 weeks before end of month to make our moves.

6 Likes
8

I agree we shoudl swtich over to a new stable coin as well and since we has usdt it shouldnt be a big problem

5 Likes
9

For the proposal process, it’s 7 days of discussion, then formal proposal submitted and once approved will go up for voting for 7 days.

Then once approved, the pools can be whitelisted which requires the 3 day time lock.

So should be at least 15 days more.

2 Likes
10

Well…I’d put forth an official proposal ASAP then because that doesn’t
leave much wiggle room given current information and timeline…

Basically people will have about a week to make moves.

1 Like
11

I support this proposal and the sooner it can get implemented, the better from my perspective.

4 Likes
12

There are two time frames at play, as outlined in the governance document.

  1. An idea that is submitted requires a 7 day Q&A period. We are in day 2 of this right now.

  2. If the idea is approved by the council, it will then be submitted as an proposal and will be put up for vote for 7 days. This idea seems to be simple and straightforward so I do not see any issues with it receiving approval.

So the timeline will require at least 14 days to make the whitelist happen, if the proposal is approved by the Guardian Holders.

When the full proposal is available for review and vote we will know more specifics about the time involved to integrate the whitelist into the applicable contracts.

5 Likes
13

The governance docs also mention a quorum of 10% of the supply of GUARD to be met for the voting process to pass so even if the proposal goes through to vote but people are unaware that they need to be an active participant in this process it can still fail or if enough people disagree obviously it’ll fail as well.

So anyone who’s interested in this proposal, might be in their best interest to let others who may still be in the dark about the discourse to start doing some reading so we have a good chance at meeting quorum for this time sensitive issue.

10 Likes
14

I support this idea as well. The sooner the better.

3 Likes
15

I support this idea.

3 Likes
16

Maybe I am being thick… but could there not be a contract written that unpairs the LP from GUARD/BUSD and then converts the BUSD to USDT and repairs to GUARD/USDT and sends the new LP token to the same holders? Seemless transition and then no potential loss of LP (or minimal less fees etc)

17

To be clear I mean a button on the Knight website that when pressed completes the steps for me - and others, rather than remove from contract, unpair, swap BUSD to USDT, add back LP etc… think it would stop a lot of people just unpairing and then not adding back… just an idea.

4 Likes
18

That’s my fear as well. But adds a lot of moving pieces and time to build and test that contract which would probably be too lengthy.

This is why I think Knight needs to re-incentivise the pool.(I understand not part of this proposal) And that could be done today to encourage new entrants even before the others move.

The goal is to maintain liquidity. $2-4million liquidity is nothing to scoff at. Up USDT-Guard multiplayer to 10. Increase the APR.

In short, I agree with this proposal. Just want to make sure the team agrees that there is more than needs to happen to reduce risk of losing a large chunk of liquidity.

2 Likes
19

Interesting idea…would still be taxed which is the purpose of the idea, whitelist the contracts so no tax.

As far as the one click solution, that would be a Knightswap suggestion and that can be done without a GFP…but the tax would still remain unless this GFI goes to and passes as a GFP

1 Like
20

Great Idea Frumpo. Glad you stepped up and brought this up. Let’s talk privately to get your proposal dialed in so it’s ready to go for community vote.

6 Likes