Moonwell

Summary

This proposal aims to correct a mistake in the allocation of September’s WELL rewards to the VELO market on Optimism. Through the execution of MIP-O07 and MIP-MO08, WELL rewards were mistakenly applied to the old, deprecated v1 VELO market instead of the more recently established VELO v2 market. This proposal seeks to remove the incentives from the deprecated market and reallocate them to the correct VELO v2 market.

Background

In a recent rewards speed adjustment proposal, rewards were intended to be distributed to the newly established VELO v2 market on Optimism. However, due to an oversight, the rewards were mistakenly applied to the deprecated VELO market. The root cause of this issue was the use of an outdated market address (deprecated VELO V1 market) during proposal generation. The branch used for generating the proposal calldata contained the deprecated market address in the file where all the addresses are kept. The commit that changed the market address was in another PR, which had yet to be merged when the proposal went live. This commit has since been merged and this error should not take place again.

The specific proposals that led to this mistake was MIP-O07 and MIP-O08 Automated Liquidity Incentive Proposals. This proposal was divided into two parts due to gas limit constraints on the Moonbeam Network. MIP-O07 was intended to distribute and adjust liquidity incentives for the period beginning 2024-09-06 and ending on 2024-10-04.

Proposal Details

This proposal will:

1. Remove WELL Rewards from Deprecated VELO Market:

   • Remove the mistakenly allocated WELL supply and borrow rewards from the deprecated VELO market on Optimism.

2. Allocate WELL Rewards to the Correct VELO v2 Market:

   • Correctly allocate the WELL supply and borrow rewards to the VELO v2 market on Optimism.

3. Update End Times:

   • Ensure that the end times for these rewards align with the originally intended schedule.

Rationale

It is essential to ensure that rewards are distributed accurately and efficiently to maintain user trust and the integrity of the rewards distribution system. Although the amount of WELL rewards mistakenly allocated to the deprecated market is relatively small, reallocating them to the correct market is necessary to avoid any confusion or potential issues.

Conclusion

This proposal is a corrective action to ensure that the WELL rewards are properly allocated to the intended market. By approving this proposal, the community will help maintain the integrity and transparency of the rewards distribution process.