Dear community,
The team is preparing the contracts and website front-end for the upcoming $Armor/$vArmor to $ease/$gvEase token swaps.
The largest $Armor token holder is the DAO, as the DAO contract owns 400 million $Armor tokens.
These tokens also need to be swapped and then transferred to the Ease DAO, but as the Armor DAO controls them, an Armor DAO on-chain vote will be needed to do so. (See also arP-002 Executed by the Ease DAO » ease.org DeFi cover)
However, this could create some practical issues that could range from a hassle to complete loss of those tokens. Let me explain:
- An $Armor DAO vote needs to pass in order to have the Token Swap go ahead.
- A 2nd vote will be needed to transfer the swapped tokens to the Ease DAO.
The Armor DAO voting system has some specifics:
See Armor launches DAO and its governance token vARmor » ease.org DeFi cover for all details, but the most important and limiting factors are the 30m Quorum needed and the 3 days Voting length.
The first 2 proposals on Tally | Armor were passed with 45m and 54m votes in favour, so well above the 30m threshold.
However, the swap can only take place automatically if the contracts are launched and accepting tokens to swap, and a vote to do so needs a 30m quorum in a vote that lasts 3 days.
- If half of those Armor DAO voters that voted in favour for the ARP-001 & ARP-002 already swapped their tokens for $ease before voting, then the quorum would not have been reached.
- Any follow up proposal would also fail as there would not be enough Armor DAO voting power left to pass any proposal.
- Even if the swap would succeed, the above is then again true for the needed proposal to transfer the tokens to the Ease DAO.
- A malicious voter could even amass several millions of $Armor, and vote against the proposal.
- In all cases this would mean that the Armor DAO would still own the 400m $Armor tokens, but have no way to swap or transfer them, leaving them effectively burned.
Technically, there would be a way to pass the vote, have the swap happen and pass a second vote that transfers the tokens to the Ease DAO, but the risk of failure is very much present, so the team wants to prevent this.
How to prevent this?
The team proposes to do the following:
- Create a vote that will send the 400m $Armor tokens back to the Treasury mulltisig.
- Swap the tokens using multisig
- Send the tokens to the new Ease Timelock contract, so it will be controlled by the Ease DAO.
Though this is not optimal as it means that the team (the signers of the Treasury Multisig) will regain control of the $400m tokens, the team thinks that this is the most practical solution to prevent any problems regarding tokens loss or Governance attacks.
Also note that Treasury/multisig controlling the tokens was also the case all the way from launch until 24th December, when the 400m $Armor tokens were sent to the DAO Timelock contract.
We welcome your thoughts and suggestions/feedback and if positive will prepare a vote, to be executed before the tokenswap will commence.
