Nothing new is being decided here, this only executes three existing decisions: NEST, the stablecoin Easy Track setup for LOL, and the CSM factory fix. I went through the script and found no discrepancies against the description.
Treasury stETH enters NEST through a separate funding motion, and LOL payments go out through their own Easy Track motions, with an objection window for LDO holders in both cases. The machinery gets switched on, the spending stays under DAO control.
Without this the DAO has no plan for a delisting except an emergency vote after the fact, by which point the pair is already gone. An authorization that sits unused costs nothing.
What I am less comfortable with is that the decision to actually switch this on never comes back for a vote. The Committee makes that call internally and the DAO finds out from the activation notice.
So the activation notice is where the DAO’s control actually sits. It needs to carry the numbers behind the decision, not just state that the threshold was met.
The BORG cannot operate without a Supervisor, and MetaLeX only leaves once a replacement is in place. The practical choice is Leeward or an empty seat.
Leeward already holds the same role at Lido Labs, so this is a known party, not a new one. Nothing moves on-chain and the seat can be reassigned by another vote if it does not work out.
Oracle and DSM operators currently hold protocol permissions on hot keys sitting in their daemons, and replacing one takes a full vote. That is the wrong way round, and this fixes it: the permission goes to a contract, the operator’s multisig decides which key is live, and a leaked key is revoked in one transaction instead of ten days.
Nothing leaves the treasury, four audits are published, and the whole thing goes through Dual Governance with a veto window for stETH holders.
The CMC gets to move the deposit reserve target through Easy Track, capped at 9,600 ETH and open to objection. Fine for the migration period, and the cap is immutable.
cp0x raised a set of questions in the LIP-37 thread that I think are worth answering. The short version is that the framework protects the operator against a leaked hot key, but if the owner multisig itself is taken, the operator has no lever left and the response falls to the DAO. That response path needs to be defined explicitly.
I’ve been arguing for buybacks in Lido since my Dynamic Buyback proposal last year, which is why this version worries me. Lowering the NEST trigger to $30M might make sense, but nobody checked what it would have changed over the past year, and the “dynamic” model in section 4 doesn’t name a single metric.
The 50% cut at Lido Labs isn’t something the DAO can decide, since staffing at the Foundation is up to its management. Our real lever is the budget, and the proposal says nothing about it and offers no calculations.
I’d support NEST changes with a real economic case behind them, not ones bundled with layoffs and an audit.
I think the buyback trigger should at least be lowered to 32 million.
Reasons are as follows:
Currently the Ldo to Ethereum exchange rate is too low. Accelerating the buyback progress at this time actually instead helps the growth of the treasury.
At the same time, it can make Ldo’s liquidity better.
Don’t let the NEST buyback gap remain in an expanding state for a long time.
I posted a proposal on NEST. It has been live since August and hasn’t bought anything yet, and I wanted to understand why and whether it can be fixed by tweaking parameters.
Short version: it can’t. Lowering the threshold or raising the share just means buying in years when the DAO is losing money. Cutting expenses would help, but right now savings don’t reach buybacks at all, because the threshold is a fixed $40M with no link to the actual budget.
So my ask is to cut the 2027 Foundations budget to around $30M and set the NEST threshold equal to the approved budget in the same vote. Any extra spending then has to be justified separately, and the threshold moves with it.
The full model, scripts and data are public. Would appreciate feedback from other delegates in the thread.
Voted for. I supported 0x02 CSM back on Snapshot. It lets smaller operators run more stake on the same bond, and the DAO gets 8% from it instead of 4%.
I’m keeping an eye on CMv1. Its priority exit threshold also goes to zero, so withdrawals will now be served from it first, and it still holds about two thirds of module balance. Hopefully operators keep up with consolidations into CMv2.