TLDR:

• This is proposed as an amendment/replacement to this previous passed proposal
  • https://gov.bancor.network/t/proposal-to-sell-bancor-3-token-surpluses-for-eth/4369
• The challenge with the previous implementation is the complexity involved and risks when using a decentralized oracle (especially with long tail tokens). While possible, it seems a much simpler/cleaner/safer implementation is possible that will reduce:
  • Value leakage
  • Attack surface area
  • Complexity
• The new method will, in brief, start with a price from CoinGecko, multiply it by 2 (starting price) and then reduce the price based on an exponential decay formula until a taker buys TKN with ETH.

Summary of Flow

This essentially creates a reverse auction where prices start above market price and gradually fall until TKN is purchased.

• Create Carbon POL contract
• Expose a public function to withdraw surplus tokens
  • If the pool has trading liquidity of 0 & vault balance is greater than staking balance, anyone can call a function to move surplus TKN from B3 to the Carbon POL contract
  • Callers get an incentive of 0.2% of the TKN to call the function
  • 99.8% of the TKN goes to Carbon POL contract
• Determine the prices in ETH for each token
  • Get price from Coingecko
  • Multiply price by 2 to get initial sell price
  • Contract offers to sell token at initial sell price for ETH
    • For example, there are 100 TKN and oracle/CoinGecko price per TKN is 0.1 ETH.
    • Initial price set at 0.2 ETH per TKN
    • Any user can send 20 ETH to acquire the 100 TKN
    • The price of TKN drops as defined by an exponential decay formula with a 10 day half life.
    • Anyone can buy the TKN with ETH at any time.
    • These parameters can be adjusted by the DAO

Note

• There is no more min return as this is no longer traded on a DEX
  • This solves many of the risks noted above regarding oracle manipulation, slippage and some MEV attacks.
• These TKN are for sale only onchain, there is no UI for this (as there is no mechanism to slowly and programmatically decrease prices in Carbon).
• The contract will have a function to see the expected return price.
• The takers are expected to be arb bots or traders interested in buying tokens at a discount.
• As an additional layer of protection, this proposal sets a prerequisite that no tokens have their initial price set until the public open source arb bot supports this process and can be a taker.
  • Of course the bot can only be a taker if there is liquidity on integrated exchanges on Ethereum.

For

Update to POL migration and conversion to ETH method as detailed above with arb bot support as a prerequisite.

Against

Take no action