Merger Quick Eli5

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This doc is an Eli5 for what to expect as a user for the merger, and will be updated on any amendments that get passed.

The merger has 4 main components: Governance, Token Swap, RageQuit, GFX Payment

Governance

Governance for all Rari products will remain identical, simply substituting the RGT token out for TRIBE and using TRIBE quorum/proposal threshold of 25M and 2.5M, respectively. We will deploy a new OZ Governor Bravo that is powered by TRIBE to govern the existing Rari timelock. There will be 2 Timelocks and governance tabs on Tally, both powered by TRIBE.

Token Swap

All RGT will be able to convert to TRIBE at a 26.705673430 exchange rate (e.g. 10 RGT = ~267 TRIBE).

This contract will have an unset expiration date. If the expiration date is set by TRIBE governance post-merger, it will be at least 180 days in the future from the moment it is set.

RageQuit

The RageQuit allows TRIBE holders from block 13623378 to be able to sell their TRIBE for newly minted FEI at the “Intrinsic Value”. Intrinsic Value is calculated as Protocol equity / circulating TRIBE. Protocol equity is PCV - user FEI, and circulating TRIBE is total supply - treasury - liquidity mining TRIBE.

These holders can only exchange TRIBE up to the amount held at block 13623378. To check availability, look in the json map here: https://github.com/fei-protocol/fei-protocol-core/blob/feat/merger/proposals/data/ragequit_data.json.

Note that users can ragequit partial amounts, and ragequit multiple times up to a cumulative value of the amount held at block 13623378.

GFX Compensation

GFX will receive a one-time payment of 315,909.06 FEI for their work on the merger proposal.

It used the following math based on the joint snapshot vote:


rgt_votes = {333000: 99690, 0: 1160, 50000: 35}

exchange_rate = 26.7056734303

rgt_votes = {k: v * exchange_rate for k, v in rgt_votes.items()}

total_votes = sum(rgt_votes.values()) + sum(tribe_votes.values())

dot_product = sum(key * value for d in [rgt_votes, tribe_votes] for key, value in d.items())

print(dot_product / total_votes)

This payment does not preclude future engagement with the Tribe pending further governance and discussion.

Misc

In particular, the hack repayment will take place within 90 days from merger completion pending further governance discussions. Any community, branding, and other discussions will take place post-merge as well.

Timelines

Monday Dec 13 - Amendments Last Call
Wed Dec 15 - Close Amendment Voting
Wed Dec 15, 12pm PT - DAO votes on Rari and Fei begin (tentative)
Saturday Dec 18 - Fei DAO vote executes
Wednesday Dec 22 - Rari DAO vote executes, Peg Exchange Begins, TRIBE Ragequit Begins
Saturday Dec 25 - Tribe Ragequit Ends

2

thanks for the update!

As users have raised previously, is it possible to make the ragequit contract functional for a very long period of time, such as the 180 days for rgt token redemption? Will there be a GUI for the ragequit contract on the FEI website when it becomes active?

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Yes a GUI will be available!

Ragequit is scoped to the merger so it wouldn’t be in the best interests of tribe holders to leave it open for very long. The current length is 3 days but this can be voted on of course

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I would like to request an expiration date to be set for token swapping. While technically RGT will become useless after the merger, I would suggest that tokens that are deprecated to be removed from circulation quickly to minimize emergent behavior and extreme volatility in token prices (eg would secondary markets still be functioning? any staking of RGT anywhere?). As such I actually want to set this expiration date a lot sooner than the 180 day window proposed - perhaps 60 days or even less.

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A token swap is unprecedented, forcing users to migrate on a small timescale is potentially not a great idea. The peg swap will help maintain secondary value of RGT and RGT holders are incentivized to migrate to participate in governance.

Given that the swap could be considered a taxable event (debatable), I am not in favor of enforcing a swap deadline, but I am open to shortening the window so that a future expiration can happen more quickly. This would require an amendment but that seems feasible.

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What would be the numbers used if ragequit was done today. From Fei Protocol Protocol equity is 1,121,835,812-423,023,891 = 698,811,924 how do we see current circulating TRIBE?

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D. Pre-merger TRIBE Circulating Supply is TRIBE max total supply - Tribe Treasury Balance -Liquidity Mining Balance, for a total of 619,605,725.325389147 TRIBE.

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@joey Could you open up the numbers please. What is the current figures of

  • Tribe in circulation
  • Tribe treasury
  • Tribe liquidity mining
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Which regulator verified this merger for conflicts of interest?

In any case, we must not rush into this deal.
RGT token already costs $21 and everyone understands perfectly well that its real value is in the region of $1 - $2.

These are tough times now and we must save our PCV, not waste it buying bubbles.

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316K FEI for the development of a 10-page document, which was initially unnecessary because all rules have not been followed, including an obvious conflict of interest.

Do you know that you can get a prison sentence for this?

All RGT holders must go through the KYC procedure.
Who is doing this?

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Cross-posting a shorter version of my post in the amendment forum here to get immediate attention.

ELI 5: The current rage quit mechanic encourages ALL old TRIBE holders to rage quit because they can cash out at a 30%+ premium to the post-deal protocol equity allocable to each TRIBE. Their rage quitting will further reduce the protocol equity leaving future TRIBE holders with even less PCV, and potentially leave FEI undercollateralized.

Moreover, because of these incentives, all “old TRIBE” who are eligible to cash out should vote for it to transfer wealth to themselves from the entire protocol at a cost to the future TRIBE holders who are excluded from the rage quit. This is analogous to the old TRIBE 51% attacking the new TRIBE.

More detail here: Merger Ragequit Mechanics Amendment - #12 by court_jester

Solution: Remove the rage quit option until we can further understand the mechanics.