[RRC-XX] Enhancing Multichain Governance: Upgrading RARI DAO Token on Arbitrum and RARI chains

Proposals Parent DAO Proposals
#1

This is a draft proposal by the Rari Foundation to gather community feedback in order to finalize this proposal for submission to the Arbitrum DAO

Abstract

DAO seeks to enhance its governance framework by upgrading the RARI token contract and bringing governance from Ethereum mainnet to the Arbitrum ecosystem. This proposal outlines the implementation of a custom L2 token on Arbitrum, facilitating efficient governance processes while reducing user costs and improving overall accessibility for the DAO. To register the custom L2 token to custom gateway on Arbitrum native bridge there should be a voting on Arbitrum DAO. This proposal asks for the community feedback to finalize proposal to the Arbitrum DAO

Motivation

RARI DAO is governed by the $RARI token, which when locked in veRARI grants voting access. The current token contract is on Ethereum mainnet and is not upgradable. The RARI DAO wishes to upgrade its governance, a part of which is token contract upgrade with snapshots and delegations embedded but we lack the ability to change the mapping on the bridge router and custom gateway on the Arbitrum native bridge.

Rationale

The RARI DAO multichain governance upgrade is designed to make governance more accessible, by simplifying the UX, reducing gas fees, and enabling new token functions. This aligns with Artbitrum’s commitment to user-centricity and technical inclusivity.
With a custom L2 token implementation we will be able to perform the RARI DAO governance upgrade and move our governance fully into the Arbitrum ecosystem.

Key terms

RARI token: RARI DAO governance token (https://etherscan.io/token/0xfca59cd816ab1ead66534d82bc21e7515ce441cf

RARI DAO: body governing the Rarible Protocol and RARI chain

Custom L2 RARI token: upgraded and simplified RARI token to be used in RARI DAO multichain governance moving forward
Smart Contract in question is in this PR: Implement bridged RARI token for Arbitrum ecosystem (Arbitrum + RARI chains) by evgenynacu · Pull Request #305 · rarible/protocol-contracts · GitHub

Specifications

RARI token in question (https://etherscan.io/token/0xfca59cd816ab1ead66534d82bc21e7515ce441cf) does not have upgradability nor allows the owner to register in the arbitrum token bridge router.

As such, we’re requesting a custom L2 token implementation, and use the (standard) custom gateway. Lacking the ability to upgrade / owner-register, we are seeking Artbirum DAO’s approval to register the upgraded RARI token to the custom gateway so we can proceed with the custom L2 implementation.

The upgraded token contract was fully audited and can be found here

Steps to implement

  1. Deploy token contracts to Arbitrum and RARI chains. See implementation here:
  2. Change mapping for L1 → L2 tokens on bridge router and custom gateway (via Arbitrum DAO proposal)

Futher steps

New token contract is designed to be upgradeable. As soon as multichain governance is set up, permissions to upgrade token contract and to do other admin actions will be transferred to the DAO

Overall costs

N/A

5 Likes
RARI DAO Weekly Highlights - July 15-21, 2024
RARI DAO Weekly Highlights - August 19-25, 2024
#2

Audit is here
Rari Bridged Token Security Analysis (2).pdf (237.1 KB)

1 Like
#3

I’ll definately be voting yes for this, looking forward to being able to unlock new use cases for the $RARI token by having the contracts being deployed on Arbitrum and the Rari Chain. Also lowers transaction fees significantly.

2 Likes
#4

Thank you very much for explaining in detail during the Governance call today.

As I mentioned, I believe it’s important to give more context on how the token will be made available on Arbitrum (and other upcoming chains). It’s important to ensure there is sufficient liquidity on the target chain → which typically involves moving tokens from the treasury to the target chain. Many projects often launch incentivized pools to achieve this.

  • How many tokens will be migrated?
  • Are we planning to deploy the token on any other chains in the near future?
  • What is the plan for creating these liquidity pools?

I love the idea of upgrading the token. I’m just looking for more context on the plan to ensure the deployment to Arbitrum is successful.

2 Likes
#5

I support this proposal; one of the more common complaints about participating in RARI DAO governance is the high gas fees, so an Arbitrum implementation of the token will help here.

However, I would first like to hear how the issues addressed by @Jaf above will be addressed; liquidity is a big concern, especially considering that there will be two different token implementations.

2 Likes
#6

thanks @Jaf @Sixty @forexus for the comments

Here is the revised proposal with added context as discussed during the governance calls. Kindly read through it and shoot over any more suggestions or questions:

This is a draft proposal by the Rari Foundation, informed by discussion with the RARI DAO and the desire of the DAO to make RARI DAO governance more accessible and effective.

Abstract

The RARI DAO seeks to enhance its governance framework by upgrading the RARI token contract and bringing its governance from Ethereum mainnet to the Arbitrum ecosystem. This proposal outlines the implementation of a custom L2 token on Arbitrum, facilitating efficient governance processes while reducing user costs and improving overall accessibility for RARI DAO. This proposal asks to register the custom L2 token and to propose the Arbitrum DAO to implement a custom gateway on Arbitrum native bridge.

Motivation

The RARI DAO is governed by the $RARI token, which, when locked in veRARI, grants voting access. The current token contract and governance hub are on the Ethereum mainnet, making participation in governance costly due to high gas fees for locking, delegating and on-chain voting. The RARI DAO has repeatedly asked to reduce governance fees, which is now possible thanks to the possibility of migrating governance to RARI chain and upgrading core governance contracts, including the token contract.

The current token contract is on Ethereum mainnet and is not upgradable. The RARI DAO wishes to upgrade its governance, a part of which is a token contract upgrade with snapshots and delegations embedded. We will also need to change the mapping on the Arbitrum native bridge router and implement a custom gateway pending a successful Arbitrum DAO vote.

Rationale

The RARI DAO governance upgrade is designed to make governance more accessible by simplifying the UX, reducing gas fees, enabling new token functions, and allowing for multichain governance. This will allow for higher governance participation and will position the DAO to be able to govern the RARI ecosystem beyond Ethereum Mainnet, which is an imperative given that the Rarible Protocol is a multichain product and that the DAO governs the recently launched RARI chain.

As the RARI token contract is on Ethererum mainnet, and not upgradable, a new custom token contract needs to be deployed. This proposal outlines the plan for a custom L2 token implementation, starting with the Arbitrum ecosystem.

Key Terms

RARI token: RARI DAO governance token (https://etherscan.io/token/0xfca59cd816ab1ead66534d82bc21e7515ce441cf

RARI DAO: body governing the Rarible Protocol and RARI chain

Custom L2 RARI token: upgraded and simplified RARI token to be used in RARI DAO multichain governance moving forward

Arbitrum ecosystem: Arbitrum One and RARI chain L3

Specifications

RARI token in question (https://etherscan.io/token/0xfca59cd816ab1ead66534d82bc21e7515ce441cf) does not have upgradability nor allows the owner to register in the arbitrum token bridge router.

As such, a new customer L2 contract with snapshotting and delegation functions needs to be deployed. The proposed upgraded token contract was fully audited and can be found here: https://github.com/rarible/protocol-contracts/pull/305.

Token contract was deployed to Arbitrum Sepolia, RARI testnet (which is on top of Arbitrum Sepolia) and all contracts were tested manually as well.

For this contract to be deployed on Arbitrum One and RARI chain mainnet, a custom L2 token pathway needs to be enabled in the Arbitrum native bridge, for which the RARI Foundation will submit a proposal, pending this proposal will be voted in.

For context, there will be several more actions to take place for the governance upgrade to be complete on a technical level:

  • custom L2 token implementation
  • custom pathway in Arbitrum native bridge
  • multichain governor contract upgrade
  • current RARI token wrapping contract for mainnet tokens to be usable in the multichain governance

As a result, the L2 RARI tokens, and the wrapped mainnet tokens will be possible to use for RARI DAO governance as they are. The veRARI model will be dropped and all locks will release once as the upgrade is complete.

RARI token holders will then be incentivized to bridge to the RARI chain (new governance hub), at minimum, by offering costless bridging. The RARI chain will in the meantime complete DeFi integrations to ensure there is liquidity and trading options for RARI tokens as they enter the ecosystem.

Steps to Implement

  1. upon passing of this proposal, the custom L2 token contract will be deployed on Arbitrum One and RARI chain
  2. RARI Foundation will then submit a proposal to the Arbitrum DAO to enable the custom gateway on the native bridge and investigate incentive funding possibilities
  3. Once the custom pathway is enabled, further proposals will be submitted to the RARI DAO to complete the governance upgrade (e.g. new governor contract, planned incentives)
  4. Full governance migration will be announced during fall '24; exact timing will depend on technical readiness

Timeline

A custom L2 token contract is ready to deploy upon this proposal’s passing.

The arbitrum proposal is ready to be submitted to the Arbitrum DAO’s forum upon this proposal’s passing.

Overall costs

N/A

3 Likes
RARI DAO Weekly Highlights - July 22-28, 2024
#7

Thank you, @JanaBe. This really clarifies the plan for me.
As per upgrading the RARI DAO token I fully support the idea.

However I still believe is important to address these 2 questions

I’m asking again because deploying $RARI on Arbitrum requires migrating DAO tokens to ensure sufficient liquidity. And at the same time we need to ensure that the DAO remains flexible and able to take advantage of future opportunities, should we decide to deploy $RARI on another chain later on.

2 Likes
#8

Thank you for this @JanaBe , exciting to see this happening! On to the future :slight_smile:

1 Like
#9

Indeed, @Jaf, there is flexibility in deploying the new token contract on other chains. The DAO can vote to deploy the token in any other ecosystem—the Arbitrum One + RARI chain is just to start and learn from, too, before the contract is deployed on more networks.

As per how many tokens to aim to have migrated to the new contract, we can aim for 150k RARI migrated & delegated at min to preserve the current level of participation (assuming 20k quorum, the threshold of 15% >> 100% is around 135k) - but this target can be discussed with the DAO as there could be strategies to deploy to have more than 1M RARI bridged.

2 Likes
RARI DAO Weekly Highlights - July 22-28, 2024
#10

Thanks for the prompt response.
Makes sense to me :+1:

1 Like
#11

Also excited to see the proposal. It’s one of the more obvious features to have a cross-chain token, also with regard to reviving RARI chain.

Do I understand correctly, that it will first be deployed on Arbitrum, and this includes RARI chain as L3?

And I assume voting on Ethereum will not be possible anymore, since veRARI will be discontinued? I support the idea to bring some sort of incentive with that and ensure liquidity, as @Jaf already pointed out, not that there will be less voting power in the end.

1 Like
#12

@bitblondy the new token would be deployed on Arbitrum One and on RARI chain to start with.
The original token on ethereum mainnet would still be available for voting, but it would need to be wrapped (instead of being locked into veRARI).

2 Likes
#13

StableLab supports this proposal for establishing a custom L2 RARI token on the Arbitrum ecosystem. By expanding governance beyond Ethereum mainnet to Arbitrum and Rari Chain, RARI DAO will significantly reduce user costs, simplify the user experience, and enhance accessibility for governance participation. This move aligns with our commitment to improving governance efficiency and ensuring robust participation within the DAO.

1 Like
#14

I fully support this proposal, and will be voting for.

Upgrading the RARI token contract on Arbitrum will benefit the RARI DAO by making governance affordable and accessible, while allowing compatibility with future upgrades and integrations within the RARI ecosystem.

1 Like
#15

Thanks for the clarification, sounds good that it would still be possible to vote with the ETH version.

1 Like
#16

Tokens were deployed on Arbitrum One and RARI chains:
https://arbiscan.io/address/0xcf78572a8fe97b2b9a4b9709f6a7d9a863c1b8e0

Bridges were not yet configured.
To configure Arbitrum Bridge an Arbitrum DAO proposal should be created

RARI chain bridge is WIP. ETA to complete - end of this week.

Let’s improve the governance, make it more accessible and easy-to-use

3 Likes