The mechanics will be quasi-identical to Ethereum with the exception that withdrawals will not mint ETH, but disperse a staking token. Currently the deposit contract holds mGNO, which represents a claim of 1/32 GNO each, hold in a wrapper contract similar to WETH. Specific details on Gnosis chain’s shapella fork:
On each block, a system transaction will credit the withdrawn amount in mGNO to a target address. However, the contract could unwrap mGNO to GNO on behalf of the user. That way the user won’t have to do any action to have GNO available on the withdrawal address. Wether the contract unwraps or not must be decided at the network level and apply to all stakers. So this post has the goal to gather feedback on the following areas:
Is any DApp using or planning to use mGNO for any purpose incompatible with automatic unwrapping?
Is there any staker that prefers to receive mGNO instead of GNO?
For every other participant, stay tunned for updates and client releases; as always good community participation will ensure we have a nice successful fork
As a validator I’d prefer receiving GNO for full withdrawals and mGNO for partial withdrawals. When I do a full withdrawal of one deposit address I did an exit and are less likely to need mGNO. When a partial withdrawal happens I am more likely to reinvest into another deposit address to run an additional validator.
But this is just for convenience. Since the fees for transactions are very low on Gnosis Chain it doesn’t matter much for me either way.
If it has to be the same for both kinds of withdrawals, I’d probably slightly prefer GNO. A partial withdrawal might also be used to pay taxes. For that purpose GNO would also be more helpful.
agree, as long as there is a way to change one to the other it doesn’t matter much if GNO or mGNO are distributed. If one solution is simpler than the other this one should be preferred.
If:
There is no specific use case that requires mGNO vs. GNO (and I don’t think there is beyond the validator deposit)
And,
The deposit contract is what converts the GNO to mGNO (and I believe this is also true )
It seems it would follow logically that the withdrawal function would convert back to GNO. There doesn’t seem there would be a reason to deposit GNO and withdraw mGNO.
I see your logic, but if the partial withdrawl gives you a fraction of a GNO and the deposit function simply converts back to mGNO, would that change your thought?
GNO would be preferred and as @Dirk mentioned, the fees on Gnosis Chain are very cheap, therefore this question is not too important as long there is a mGNO <-> GNO converter.
Imo as long as mGNO isn’t supported by the Defi ecosystem, it makes no sense to pay out mGNO. A specific scenario where mGNO makes a lot of sense (don’t know if technically feasible or wanted for security/risk reasons) → You borrow on Agave and you can automatically repay your loan or increase the collateral with staking rewards
Sorry for not acknowledging before but thank you so much for your input! It was very useful to the internal discussions of this change.
This PR includes the relevant changes to drop mGNO from the deposit contract.
(I can’t post links sorry, please google this link!)
Github /gnosischain/deposit-contract/pull/31
Users can still deposit mGNO via a wrapper contract, which will be active before the fork. The mGNO wrapper contract will remain active so users can wrap and unwrap GNO if they want to.
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