Introducing: Moonwell Artemis Governance

One overarching goal of the Moonwell community has been to create financial infrastructure that will stand the test of time and outlive any contributing team or individual. Applications and developers that build on top of Moonwell should have confidence that the protocol will have the resilience to operate indefinitely. By decentralizing governance, removing single points of failure and empowering the community to ratify changes to the protocol, a viable path to this goal is created.

Today, we’re proud to announce that Moonwell Governance has been made the Moonwell protocol’s administrator. This will enable the community to recommend, discuss, vote and implement changes to Moonwell without requiring any sole individual or contributing team to ratify those changes. As a community, we will be able to govern Moonwell together! 🏛️🗳️💪

WELL, The Moonwell Artemis governance token

Governance rights over Moonwell are provided via the Moonwell Artemis governance token: WELL. 1 delegated WELL token (either to yourself or to another delegate) is equal to 1 vote.

The WELL token is a standard ERC-20 token on the Moonbeam network. Holders of the WELL token can delegate their voting rights to the address of their choice, either to themselves or to other wallets within the community. Additionally, all sales participants will receive the ability to vote with or delegate their unvested tokens. This opens a number of interesting possibilities — such as smaller coalitions of voters banding together to get a proposal enacted, or groups of WELL holders delegating their votes to a trusted representative that will advocate for their interests.

WELL token holders can also choose to help secure the Moonwell protocol by staking WELL in the Safety Module. Staked WELL tokens, or stkWELL, carry the same governance rights as native WELL, and 1 stkWELL held in a voting wallet imbues the same voting power as 1 WELL token.

Moonwell Improvement Proposals

The process to implement changes to the Moonwell protocol starts with a proposal, known as a Moonwell Improvement Proposal, or MIP. In general, proposals should start with a post in the Moonwell Governance Forum. Anyone can register for an account on the forum, and all discussions are publicly available. The community welcomes thoughtful proposals and discourse about those proposals from everyone, whether or not they are a WELL token holder.

Snapshot Voting

For proposals that will result in substantial changes to the Moonwell protocol, it is recommended that the proposal author first gauges community interest by capturing a “signaling vote.” Signaling votes are non-binding, since they don’t have the ability to directly change the protocol; however, they are a valuable means of measuring sentiment on substantive issues as well as garnering feedback to iterate and refine original proposal ideas. This process also enables the community to capture interest in proposals that might not require changes to the Moonwell protocol directly, for example, proposals that require humans to take some action in the real world, like engaging or providing a grant to an expert contractor to perform work that benefits the Moonwell community.

A snapshot voting portal is now live, where signaling proposals can be created by any WELL holder or delegate that meets the threshold of 200,000 votes (i.e., 200,000 WELL tokens). Signaling proposals will be considered to have passed if they receive a majority of Yay votes and reach a minimum quorum of 10,000,000 votes (i.e., 10,000,000 WELL tokens). These thresholds can be modified in the future by means of a community vote.

The Proposal Process

A Moonwell Improvement Proposal possesses both a description and code that will be executed on the Moonbeam network following its passage. The governance portal aims to make it easy to browse and vote upon MIPs that are currently undergoing active voting. The full proposal process is illustrated in the diagram below. Note that this is different from Snapshot Voting mentioned above, and has a higher proposal creation threshold, as the vote is binding on chain.

Proposal creation

A proposal can be created by any wallet that has enough voting power to meet the creation threshold, which is currently set at 400,000 votes (i.e., 400,000 WELL tokens). The proposal author must submit the description and code, which consists of a set of up to 100 operations that will be executed if the proposal passes. Once the proposal has been created, the active voting period begins after a short delay of 60 seconds.

Voting Period

The initial voting period is 3 days, during which any wallet with voting privileges (i.e., any wallet with WELL tokens (either vested or unvested) or stkWELL) can register a vote of Yay, Nay, or Abstain. At the end of the voting period, a proposal will be considered to have succeeded if it meets the following criteria: it has received a majority of Yay votes (i.e., the number of Yay votes is greater than the number of Nay votes), and a quorum of at least 100,000,000 total votes (i.e., 100,000,000 WELL tokens). The quorum threshold includes all Yay, Nay, and Abstain votes, but Abstain votes will not be counted when determining whether the proposal has passed. Therefore it is possible for Abstain votes to assist a proposal in reaching quorum and passing successfully, even if the total proportion of Yay votes does not make up the majority of all casted votes. If a proposal does not reach both the quorum and Yay votes greater than Nay votes requirements during the 3 day voting period, it will be considered defeated and will not be executed.

Timelock

After a proposal succeeds, it will be queued in the Timelock, which introduces a mandatory 24 hour delay before the proposal will be executed. This is intended to give the community time to react to a proposal before it is executed.

Execution

Once the Timelock delay has elapsed the proposal can now be executed by any account on the Moonbeam network, at which point all of the operations included in the proposal will be performed.

Governance Parameters

It is important to note that the governance parameters outlined below can be modified by the community through the voting process. The entire governance system can even be replaced with a new smart contract through governance itself, so the Moonwell community can ultimately decide whether this system works, or whether another form of governance is optimal. In fact, these governance parameters are merely a baseline for the Moonwell community to test, iterate and refine over time.

The initial governance parameters are set as follows:

Snapshot/Signal voting
Proposal threshold (how many votes are required to create a proposal):
▹200,000 votes
Voting period (how long the proposal can be voted on):
▹3 days
Quorum (how many votes are required for the proposal to pass):
▹10,000,000 votes

Governance Proposals
Voting delay (how soon the voting period begins after a proposal is created):
▹1 minute
Proposal threshold (how many votes are required to create a proposal):
▹400,000 votes
Voting period (how long the proposal can be voted on):
▹3 days
Quorum (how many votes are required for the proposal to pass):
▹100,000,000 votes

Governance Guardians

In the early days of governance there may come a time where, through some unpredictable and unknown bug or event outside the control of the Moonwell community, the governance system fails and the Moonwell Artemis protocol becomes “ungovernable”. For example, if a proposal accidentally changed the required quorum to an amount that was impossible to achieve with the available voting power then no further proposals could ever be passed. To mitigate this risk, the Moonwell community has selected interim “Governance Guardians” through signal voting. These guardians have been selected for their expertise in DeFi and governance, and they have special powers that are designed to only be activated during an emergency that results in a failure of the Moonwell governance system: they can invoke a “break glass in case of an emergency” function that returns the administration of the Moonwell protocol back to the previous administrator.

The Governance Guardians have agreed to only invoke their powers in case of a serious bug or deadlock in the governance system — the type of scenarios that would be catastrophic to the proper functioning of the Moonwell protocol, such as being unable to pass or execute any governance proposals, and they can never veto or cancel a proposal they disagree with. If this were to ever occur, the administrator would deploy a new Governor contract and, as soon as the threat has passed, return control of the protocol to the WELL token holders. The only actions performed during this hopefully never occurring circumstance will be in the strict interest of restarting governance and restoring its proper function in line with the community’s intentions. It is the hope that the Moonwell community will work as a decentralized collective to monitor and stay vigilant with respect to Moonwell governance such that the Governance Guardians never have to invoke such powers.

Initial Guardians

Niko Grzesiak, a Moonwell community member, created a snapshot vote that passed unanimously and enabled the community to ratify the proposed set of initial guardians below:

• Niko Grzesiak is a co-founder of the decentralized trading platform Firefly and a quantum physicist by trade.
• 0xMaki is a semi-anonymous contributor mainly known for cofounding Sushiswap and currently make the ecosystem omnichain via LayerZero & helping LP maximize their yield at Aura finance. He is daoist and love NFT art with implication in the Moonbirds & Nouns communities while he isn’t angel investing, advising numerous projects or signing transactions on the 10s of multisig keeping him up at night (Aave, Stargate, Balancer, 88mph, etc.)
• x0s0l — SolarApe is an anonymous co-founder of decentralized exchange Solarbeam and Solarflare. He’s also a contributor to the Moonwell Apollo and Artemis protocols.

The emergency powers are currently held in this multisig, which requires 2 of 3 owners to execute any of the emergency powers.

Sunset Provision

These emergency powers are temporary, and they are designed to be sunset after a 6 month time period has elapsed from the start of governance. Once 6 months have passed, it is the hope that the Moonwell community will have high confidence in the governance system, at which point a proposal can be passed through governance to permanently remove the Governance Guardians, and the emergency powers held by this multisig.

How to get involved

If you’d like to get involved in Moonwell governance, there are a number of immediate steps you can take to do so. The community is in need of active voters and delegates, and every contribution is welcome. Here’s how you can make a difference and have your voice heard:

Activate your Voting Power

You can activate your voting power through the Moonwell Artemis application itself, by delegating to yourself or to others. This is an important first step before you are eligible to vote on proposals. It’s important to note that simply holding WELL tokens in your wallet won’t give you voting rights/power until you delegate those somewhere, even to yourself.

Register at the Governance Forum

When you register at the Moonwell Governance Forum, you’ll be able to discuss proposals with other members of the community, register your interest in becoming a delegate, or find a delegate that aligns with your interests.

Register for Snapshot Voting

You can also register for snapshot voting, such that you can signal your support for Moonwell Improvement Proposals, and help shape nascent ideas that you’d like to see become full-fledged proposals. This is an important way to gauge community interest and help form new ideas into proposals that can later be executed.

Head to the Polls!

Once your votes are activated by delegating to yourself or others, visit the Moonwell Artemis governance portal to browse and vote on proposals. We can’t wait to see the amazing Moonwell Improvement Proposals that the Moonwell community creates!

About Moonwell Artemis

Moonwell Artemis is an open lending and borrowing DeFi protocol built on Moonbeam, and is supported by the Lunar Technology Foundation, which is responsible for fostering the development of the Moonwell protocol and its ecosystem.