Hi @Callen_Wintermute!
Thanks for the thoughtful proposal.
I have quite a lot of questions regarding the proposal, even though not all of them are directly directed towards Wintermute.
First an obvious one: How can we verify the address actually belongs to Wintermute? Could you provide proof that Wintermute controls the address, e.g. via posting a signature and having Wintermute confirm your account? If it is not an EOA (e.g. precomputed contract address), would it be possible to send a dust amount of some token from a publicly known Wintermute address to it?
I assume this proposal does not come of out nowhere. The FORTH token is listed on cexs, such as Coinbase, since its inception and so far there is no publicly known agreement of mm’ing FORTH.
This pressures some questions - which I would also love some input from the genesis team (@Brandon @evankuo):
- Would this actually be the first agreement of Wintermute to mm FORTH and/or AMPL?
- If so, could you provide data as to why Wintermute (and/or the genesis team) thinks now mm is necessary?
- If not, does the proposal reflect the conditions of the prior agreement?
As I understand correctly this would be an unsecured loan. What kind of guarantees does the ForthDAO have of repayment? How did Wintermute handle such concerns in the past?
About the repayment token:
- The ForthDAO does not have any infrastructure on Bitcoin, so I assume you mean WBTC as the possible repayment token?
- Would the repayment token be decided by Wintermute or is it in the hands of the ForthDAO to decide the repayment token?
About the Strike Price:
Seeing this proposal from Wintermute about mm’ing MKR, Wintermute agreed to have a strike price of 10,000$ per MKR at a price (on the 28’th October 21) of 2,242$. The option from that proposal is only in the money at a price increase of nearly 350%. How do you avow the difference of nearly 1,300% compared to this proposal?
About mm’ing AMPL:
we pride ourselves in fostering long-term relationships and value-creation, partner-protocol alignment
If this is indeed a motivation, could you elaborate as to why the proposal only aims to mm FORTH and not AMPL itself? Referring back to the MKR agreement once more - via which you mm’ed MKR and DAI, why does this proposal only concentrate on the governance token? Isn’t it in the ForthDAO’s, and therefore also Wintermute’s protocol alignments, best interest of first and foremost concentrate on the protocol’s actual “product”?
About the FORTH token amount:
The ForthDAO currently holds around 3,7MM FORTH tokens with a total supply of ~15MM.
So Wintermute receives cheap call options for ~5% of the total FORTH supply… on top of receiving free mm inventory for a year… This seems like a hell of a deal for Wintermute, doesn’t it?