The Governance Facilitators, Sidestream, and Dewiz have placed an executive proposal into the voting system. MKR/SKY Holders should vote for this proposal if they support the following alterations to the Sky Protocol.

If you are new to voting in the Sky Protocol, please see the voting guide to learn how voting works.

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Executive Summary

If this executive proposal passes, the following actions will occur within the Sky Protocol:

• Smart Burn Engine (SBE) will be reconfigured featuring a new contract deployment that is changing the nature of the SBE.
• Transfer 10 million USDS and 320 million SKY to Sky Ecosystem Liquidity Bootstrapping.
• Distribute 124,745 DAI and 29.46 MKR for August Aligned Delegate Compensation.
• Trigger Spark Proxy Spell at 0xc80621140bEe6A105C180Ae7cb0a084c2409C738.

Voting for this executive proposal will place your governance tokens in support of the actions outlined above.

Unless otherwise noted, the actions listed above are subject to the GSM Pause Delay. This means that if this executive proposal passes, the changes and additions listed above will only become active in the Sky Protocol after the GSM Pause Delay has expired. The GSM Pause Delay is currently set to 16 hours.

This executive proposal includes an office-hours modifier that means that it can only be executed between 14:00 and 21:00 UTC, Monday - Friday.

If this executive proposal does not pass within 30 days, then it will expire and can no longer have any effect on the Sky Protocol.

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Proposal Details

Smart Burn Engine (SBE) Reconfiguration

• Authorization: Ecosystem Approval, Poll 1140
• Proposal: Forum Post

If this executive proposal passes, a new SwapOnly Flapper will be initialized. This reconfiguration changes the SBE from a buy-and-make to a buy-and-accumulate model through the following contract actions. Accumulated tokens will be held in the Pause Proxy.

Flapper Initialization

Initialization of the new SwapOnly Flapper will be performed by calling FlapperInit.initFlapperUniV2 with the following parameters:

• flapper_: FlapperUniV2SwapOnly (0x374D9c3d5134052Bc558F432Afa1df6575f07407)
• want: 0.98 * WAD
• pip: SWAP_ONLY_FLAP_SKY_ORACLE (0x61A12E5b1d5E9CC1302a32f0df1B5451DE6AE437)
• pair: PAIR_USDS_SKY (0x2621CC0B3F3c079c1Db0E80794AA24976F0b9e3c)
• usds: dss.chainlog.getAddress("USDS")
• splitter: dss.chainlog.getAddress("MCD_SPLIT")
• prevChainlogKey: bytes32(0)
• chainlogKey: "MCD_FLAP"

Oracle Wrapper

Initialization of the new OracleWrapper will be performed by calling FlapperInit.initOracleWrapper with the following parameters:

• wrapper_: SWAP_ONLY_FLAP_SKY_ORACLE (0x61A12E5b1d5E9CC1302a32f0df1B5451DE6AE437)
• divisor: 24,000
• clKey: "FLAP_SKY_ORACLE"

Additional Actions

Additionally, the following parameters will updated if this executive proposal passes:

• Increase the hop parameter (vow.hop) by 1,386 seconds from 10,249 seconds to 11,635 seconds.
• Decrease the bump parameter (vow.bump) by 40,000 USDS from 65,000 USDS to 25,000 USDS.

Sky Ecosystem Liquidity Bootstrapping

• Authorization: Delegate Poll Request, Poll 1144
• Proposal: Forum Post

If this executive proposal passes, then 10 million USDS and 320 million SKY will be transferred to the Sky Ecosystem Liquidity Bootstrapping multisig at 0xD8507ef0A59f37d15B5D7b630FA6EEa40CE4AFdD.

To facilitate the transfer of USDS the following actions will occur:

• Transfer 10 million Dai from the Surplus Buffer to the Pause Proxy.
• Convert this Dai to USDS using the DAI_USDS converter.
• Transfer the resulting 10 million USDS to the destination address.

To facilitate the transfer of SKY the following actions will occur:

• Convert 13,334 MKR held within the Pause Proxy to SKY using the MKR_SKY converter.
• Transfer 320 million SKY to the destination address.

Aligned Delegate Compensation

• Authorization: Atlas 2.6.3 (legacy)
• Proposal: Forum Post

If this executive proposal passes, then a total of 124,745 DAI and 29.46 MKR will be distributed to six Aligned Delegates and their teams as compensation for August 2024.

DAI Distributions

Delegate	Amount (DAI)	Address
BLUE	54,167	0xb6C09680D822F162449cdFB8248a7D3FC26Ec9Bf
Cloaky	20,417	0x869b6d5d8FA7f4FFdaCA4D23FFE0735c5eD1F818
Kohla (Cloaky)	10,000	0x73dFC091Ad77c03F2809204fCF03C0b9dccf8c7a
Ennoia (Cloaky)	10,000	0xA7364a1738D0bB7D1911318Ca3FB3779A8A58D7b
JuliaChang	8,333	0x252abAEe2F4f4b8D39E5F12b163eDFb7fac7AED7
Byteron	8,333	0xc2982e72D060cab2387Dba96b846acb8c96EfF66
Rocky	8,065	0xC31637BDA32a0811E39456A59022D2C386cb2C85
BONAPUBLICA	5,430	0x167c1a762B08D7e78dbF8f24e5C3f1Ab415021D3

MKR Distributions

Delegate	Amount (MKR)	Address
BLUE	13.75	0xb6C09680D822F162449cdFB8248a7D3FC26Ec9Bf
Cloaky	12.00	0x869b6d5d8FA7f4FFdaCA4D23FFE0735c5eD1F818
JuliaChang	1.25	0x252abAEe2F4f4b8D39E5F12b163eDFb7fac7AED7
Byteron	1.25	0xc2982e72D060cab2387Dba96b846acb8c96EfF66
Rocky	1.21	0xC31637BDA32a0811E39456A59022D2C386cb2C85

Spark Proxy Spell

• Authorization: Ecosystem Approval, Poll 1141
• Proposal: Forum Post

If this executive proposal passes, then the Spark Proxy Spell, prepared by Phoenix Labs, and reviewed by Wonderland and Certora, at address 0xc80621140bEe6A105C180Ae7cb0a084c2409C738 will be triggered.

[Mainnet] Collateral Onboarding of cbBTC

If this executive proposal passes, the Spark Proxy Spell will onboard cbBTC as described below:

• Token: cbBTC
• Token Address: 0xcbB7C0000aB88B473b1f5aFd9ef808440eed33Bf
• Oracle: Chronicle Labs BTC/USD
• Oracle Provider: Chronicle Labs
• Optimal Utilization: 60%
• Base: 0%
• Slope1: 4%
• Slope2: 300%
• Stable rate func (deprecated): N/A
• Borrow Enabled: Yes
• Isolation Borrowable: No
• Stable Rate Borrowing: No
• Siloed Borrowing: No
• Flash Loan Enabled: Yes
• Loan To Value: 65%
• Liquidation Threshold: 70%
• Liquidation Bonus: 8%
• Reserve Factor: 20%
• Supply Cap: 500 cbBTC
• Supply Cap Absolute Maximum Exposure (max): 3,000 cbBTC
• Supply Cap Target Available Exposure (gap): 500 cbBTC
• Supply Cap Automator Cooldown Period (ttl): 12 hours
• Borrow Cap: 50 cbBTC
• Borrow Cap Absolute Maximum Exposure (max): 500 cbBTC
• Borrow Cap Target Available Exposure (gap): 50 cbBTC
• Borrow Cap Automator Cooldown Period (ttl): 12 hours
• Isolation Mode: No
• Isolation Mode Debt Ceiling: N/A
• Liquidation Protocol Fee: 10%
• High Efficiency Mode (Emode) Category: 0

Review

Community debate on these topics can be found on the Sky Governance forum. Please review any linked threads to inform your position before voting.

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Resources

Additional information about the Governance process can be found in the Operational Manual.

To add current and upcoming votes to your calendar, please see the Sky Governance Calendar.