MIP18: Meta-Parameter Adjustments

MIP18: Meta-Parameter Adjustments

Preamble

MIP#: 18
Title: Meta-Parameter Adjustments
Author(s): @LongForWisdom, Charles St.Louis (@CPSTL), Rune Christensen (@Rune23)
Contributors: n/a
Type: Process
Status: Formal Submission (FS)
Date Proposed: 2020-07-07
Date Ratified: <yyyy-mm-dd>
Dependencies:
Replaces:

References

n/a

Sentence Summary

MIP18 defines a process for modifying Maker Protocol Meta-Parameters.

Paragraph Summary

This proposal outlines and formalizes the concept of Meta-Parameters in the Maker Protocol. It also contains a list of the current meta-parameters used in Maker Governance, a meta parameter attributes table for each type of active meta-parameters, a meta-parameter Adjustments Subproposal process for modifications (changes, additions, or removal) of meta-parameters, and a meta-parameter option distributions list to which will be used for meta-parameter polls.

Component Summary

MIP18c1: Meta-Parameters

Defines key terms related to the Meta-Parameter Adjustment process.

MIP18c2: Meta-Parameter List

Defines a list of the current meta-parameters. Furthermore, it describes the intentions behind the meta-parameters and how they affect other system parameters, vote frequencies, and poll options.

MIP18c3: Meta-Parameter Attribute Table

Defines the attributes for each type of meta-parameter poll, including vote frequency, vote type, and vote options.

MIP18c4: Meta-Parameter Adjustments Process

Defines a process component to modify MIP18c2 and MIP18c3 by adding, changing, or removing meta-parameters or their respective polling attributes.

MIP18c5: Meta-Parameter Option Distributions

Defines the available option distributions for meta-parameter polls.

Motivation

This proposal aims to formalize a process for adjusting meta-parameters to make adjustments to the Dai Savings Rate (DSR) Spread and the Base Rate.

Specification / Proposal Details

MIP18c1: Meta-Parameters

Meta-Parameters are parameters that do not correspond directly to parameters within the Maker Protocol’s smart contracts.


MIP18c2: Meta-Parameter List

Base Rate

  • Primarily a monetary policy lever.
  • Adds a flat number to the Stability Fee for each collateral type in the Maker Protocol.
  • Stability Fee = Base Rate + Risk Premium.

Dai Savings Rate Spread

  • Primarily a growth/profit lever.
  • Modifies the difference between the Base Rate and the Dai Savings Rate (DSR).

MIP18c3: Meta-Parameter Attribute Table

Meta-Parameter Vote Frequency Vote Type Option Distribution Option Limits
Base Rate Weekly IRV Exponential-around-current -4, +4
DSR Spread Bi-Weekly IRV Exponential-around-current -4, +4, ≥ 0

MIP18c4: Meta-Parameter Adjustments Process

The MIP18c4 modification process is done through a subproposal process, in which MIP18c4 subproposals are submitted to the Monthly Governance Cycle like any other proposal.

MIP18c4 subproposals have the following parameters:

  • Default Feedback Period: 3 months
  • Frozen Period: 1 month

MIP18c4 subproposals must use the template located at MIP18c4-Subproposal-Template.md. This template is considered ratified once this MIP moves to Accepted status.


MIP18c5: Meta-Parameter Option Distributions

Linear-around-current

  • Options for the DSR value around the current parameter value.
  • Integer only
  • Example (around zero) -4, -3, -2, -1, 0, 1, 2, 3, 4

Exponential-around-current

  • Options for the DSR for the current parameter value.
  • Integer or non-integer
  • Example (around zero) -4, -2, -1, -0.5, -0.25, 0, 0.25, 0.5, 1, 2, 4

MIP18 MIPs Github Repository Source: https://github.com/makerdao/mips/tree/RFC/MIP18

2 Likes

Looks great. One minor mistake in the DSR Spread definition: the lower limit is currently greater than or equal 0 and not strictly greater than.

3 Likes

Good catch, Sam. Thanks.

1 Like

Updated to -4, +4, ≥ 0. Thanks, Sam.