Kwenta State Log

A living document defining the state of Kwenta

Kwenta State Log

Kwenta Improvement Proposals

KIP-115: Reduce Staking Cooldown

Simple Summary

This KIP proposes changing the staking cooldown period in Kwenta from 14 days to 7 days, enhancing liquidity and user flexibility.

Abstract

The proposed adjustment will modify the staking cooldown mechanism within the Kwenta protocol. This change aims to provide a balance between maintaining secure governance and offering users greater agility in managing their staked assets.

Motivation

The existing 14-day cooldown is a preventive measure against voting manipulation but is overly restrictive for users needing quick access to their assets in a volatile market. Reducing the cooldown to 7 days aligns with the need for both responsive liquidity and reliable governance.

Specification

  1. Upgrade StakingRewardsV2 implementation so that the immutable MIN_COOLDOWN_PERIOD variable is reduced from 1 weeks to 0.
  2. Call the StakingRewardsV2.setCooldownPeriod(uint256 _cooldownPeriod) function with 7 day.

Technical Notes

Currently the cooldown period is adjustable via the StakingRewardsV2.setCooldownPeriod function. However it can only be set between the bounds of the MIN_COOLDOWN_PERIOD and MAX_COOLDOWN_PERIOD defined in that contract. Currently those values are set at 1 week and 52 weeks respectively: uint256 public constant MIN_COOLDOWN_PERIOD = 1 weeks; uint256 public constant MAX_COOLDOWN_PERIOD = 52 weeks; Due to the limitation of the MIN_COOLDOWN_PERIOD, we can only reduce the cooldown period to a minimum of 1 week via the setCooldownPeriod function with the current smart contract implementation. In order to reduce the cooldown period further, it requires a smart contract upgrade to change the value of MIN_COOLDOWN_PERIOD. Thankfully this is an extremely trivial smart contract upgrade - about as simple as it gets.

 Parameter Change Summary

We would make the following two parameter changes:

  • MIN_COOLDOWN_PERIOD goes from 1 week to 0
  • cooldownPeriod goes from 2 weeks to 1 week The argument for 0 for MIN_COOLDOWN_PERIOD is that it provides the maximum amount of flexibility, and the value can be safely set to 0 as a way of totally turning the cooldown off if we ever want to. The reasoning behind 1 week for the cooldown period is described above in the KIP Motivation section.