CMC’s plan regarding Deposit Reserve Target management ET
In light of the upcoming on-chain vote to add the Easy Track factory for Deposit Reserve Target management, CMC members want to share a preliminary plan for using this ET factory in a short term.
Step 1. Setting depositsReserveTarget to ZERO before 0x02 CSM goes live
depositsReserveTarget is currently set to 1500 ETH after SRv3 release. This value was chosen to ensure timely allocation of the initial deposits to CMv2 in case of a sustained withdrawal pressure. However, the reality turned out to be different, and CMv2 already has all the keys required for consolidations from CMv1 seeded as of today. In addition, CSM has a relatively small number of available depositable keys in anticipation of the upcoming 0x02 CSM mainnet release. That results in the majority of the deposit reserve capacity today being allocated to the now-legacy CMv1. Since all of the stake from CMv1 should eventually be migrated to CMv2, we believe that depositsReserveTarget should be set to 0 until 0x02 CSM goes live.
Step 2. Setting depositsReserveTarget to 1500-2000 ETH after 0x02 CSM release
Once 0x02 CSM goes live, it will be the most staking module with the highest reward share for the Lido DAO. In addition, it will also be fully permissionless, which makes stake allocation to this module even more attractive. We believe that if there is demand from Node Operators to run validators in this module, setting depositsReserveTarget to a value between 1500 and 2000 ETH (the exact value to be defined and communicated later) is a reasonable decision that will drive stake towards 0x02 CSM at a faster pace.
Further actions are hard to define at the moment. Hence, they will be discussed and communicated later.