[ARC] Change Admin role of Optimism and Arbitrum V3 markets

[ARC] Change Admin role of Optimism and Arbitrum V3 markets

aip: TBA

title: [ARC] Change Admin role of Optimism and Arbitrum V3 markets

status: Proposal

author: Marc Zeller @marczeller, Miguel Martinez @miguelmtzinf

created: 20/09/2022

Title:

[ARC] Change Admin role of Optimism and Arbitrum V3 markets

Simple Summary:

Aave V3 Arbitrum & Optimism markets are currently governed by the Community Guardian, a 6/10 elected multisig of 10 Aave community members with the responsibility to enforce community decisions on snapshot on-chain.

This ARC intends to replace the community guardian in favor of Aave governance contracts for the administration of Arbitrum & Optimism V3 markets.

Motivation:

As cross-chain governance bridges received recent audits and in favor of more decentralization of Aave, this AIP intends to fade the community guardian role in Arbitrum and Optimism V3 markets in favor of Aave governance contracts.

This means that if this AIP is validated by Aave governance, every AIP concerning the Arbitrum and OP markets will require an On-chain AIP vote to directly modify the Aave V3 markets on these networks for example onboard a new asset or change an asset risk parameters.

The community guardian multisig always has been presented as a temporary solution in the wait of a cross-chain messaging solution allowing the Aave governance contracts to enforce directly onchain with no trusted intermediary for the governance decisions.

Fading the guardian role is a step forward in Aave protocol decentralization.

if this AIP gathers governance approval, the community guardian will keep an “emergency failsafe” role with the ability to freeze markets or cancel AIPs votes to protect the Aave markets in case of crisis or malicious AIPs.

The cross-chain governance bridge contract that allows more decentralization of the Aave protocol has been audited by ChainSecurity and Certora, and a report of the audit of this contract can be found in the technical link section of this AIP.

Technical specifications:

The cross-chain governance bridges is a set of smart contracts that serve as an extension of the Ethereum Aave Governance, receiving the approved actions by the community in Ethereum, and executing them in the target chain.

The details of the actions are described in a message which is passed from the L1 Aave Governance Executor contract using the native messaging mechanism of the chain:

The recipient of the bridged actions are the governance bridge contracts. Once actions reach these contracts, they are registered in the execution queue so they can be executed after a delay period. Queued actions are susceptible to being canceled for a period of time (e.g. grace period) by the Guardian. This is an “emergency failsafe”, a mechanism to protect the market in the target chain in case there is malicious or illegitimate action. This is a last-resort instrument that can be used by the Community Guardian Multisig.

A detailed specification of the contracts and workflow is outlined in this repository.

Technical Links

Optimism cross-chain governance bridge contract:

https://optimistic.etherscan.io/address/0x7d9103572be58ffe99dc390e8246f02dcae6f611#code

Arbitrum cross-chain governance bridge contract:

https://arbiscan.io/address/0x7d9103572be58ffe99dc390e8246f02dcae6f611#code

Cross-chain governance bridge Audit report:

https://github.com/aave/governance-crosschain-bridges/blob/master/audits/26-07-2022_ChainSecurity_AaveL2BridgeExecutors.pdf

Next steps:

If the community approves this ARC, a snapshot vote will be published after a minimum of 5 days delay. If YAE is the majority outcome of the snapshot vote, the Community Guardian will change the administration of specified Aave V3 markets.

6 Likes

This proposals allows the Aave Community to take over Optimism and Arbitrum markets while meeting the highest quality standards. A good day for decentralization!

3 Likes

Props to the work done by the OPs on enabling cross-chain governance execution on Optimism and Arbitrum. Given the ever-changing landscape of bridging technology, we have been a first-row witness to the technical effort done to move forward with the implementation.

Regarding the movement of permissions, even being up to the community to decide, we believe this is another step to improve decentralization, now that technical infrastructure enables it.

From BGD’s side, we will be supporting this development by expanding our cross-chain listing template to the specifications of Optimism and Arbitrum cross-chain governance on https://github.com/bgd-labs/aave-v3-crosschain-listing-template

1 Like

A significant step forward - and much needed, placing ownership in the hands of governance constructs.

We are grateful for the work and support of the current Community Guardian signers (too many to list) and look forward to a future of more community control.

We welcome the transition of more V3 markets if this change goes smoothly.

2 Likes

This proposal is now live on Snapshot: Snapshot

to save up on engineering resources and due to previous multiple success of Aave governance bridge with Polygon, approval of the snapshot vote will result in change of admin role of both markets without the creation of a “mock” AIP on chain vote.