RFC: POP V2 (Pool Onboarding Process, Version 2)

Centrifuge Governance Proposals
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Proposal type: CP-4
Author: @ctcunning
Contributor: @sirj
Technical/non-technical proposal: non-technical
Date proposed: 2022-12-14

Short summary

Proposal for an improved POP V2 from the current POP (V1) that exists today.

High level objective

To simplify the POP process for RWAs onboarding through the Centrifuge protocol and to increase the Community engagement and participation in the process. If this proposal is to pass in the future, it will be added as CP-5 (POP) to the governance process.

Background

The POP has been active for over 6 months. In that time, we’ve seen 12 POPs submitted, a number of Introductions, a couple of Pool Parties, and the discussion and engagement around RWAs continues to rise across the Forum.

A POP Workshop back in October revealed opportunities for improvement, with insights coming from both the Community and POPs directly.

For those interested in what the POP has accomplished to date, please review this POP Pipeline Summary.

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Why the POP Exists

Let’s quickly revisit why the POP exists.

The POP is a community owned and CFG governance-led process for onboarding RWAs into DeFi through the Centrifuge protocol.

The POP is intended to both simplify the process, as well as curate the quality of RWAs financed through Centrifuge in a transparent, open structure that enables participation from the community as well as from experts.

The process is held by the Community, and most specifically CFG token holders, using their tokens to vote on POPs.

Detailed description of proposal

This RFC begins an informal discussion around a POP V2 proposal, which I expect will result in a formal proposal led through governance sometime in January 2023. I am sharing this before the end of the year, to give the community time to review and provide feedback for improvement in the POP V2 below.

This POP RFC hopes to accomplish:

  • A long-term vision to develop a decentralized onboarding process owned by the community through on-chain governance
  • An immediate term way for easier access to the Pools and better investor engagement around high quality opportunities reviewed by the Credit Group
  • A more clear outline of requirements and process to launch a Pool through Centrifuge

I’d like to invite the Community, CFG token holders, and the broader realm of RWA participants in DeFi to review, comment, and improve this POP as initially drafted in the documents below.

The V2 process is simpler, provides on-chain voting to CFG token holders, and places the Credit Group more prominently into the process, to report on each POP.

Please review and comment on the Process (image below) and use the accompanying POP V2 - Process Appendix, which includes an explanation for each step above. There have also been adjustments to allow for more subjectivity and more description in the POP V2 - Proposal Template, while intending to be more helpful through the POP V2 - Proposal Guidance, which will be agreed upon by the Community to help provide guidance and direction to POPs before they submit a POP through governance.

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Alignment to the mission of Centrifuge DAO

This process attempts to decentralize the onboarding of RWAs and drive decisioning through governance and the Centrifuge Community.

The Next Steps

After the RFC period, which I would hope to be about 4 weeks’ time, the RFC would incorporate all feedback and input from the Community and be submitted as a formal Proposal.

I hope that the Centrifuge Community will take the time to review this documentation and this process to provide meaningful feedback and propose solutions to improve this process for future POPs who seek to finance RWAs through the Centrifuge protocol.

I will bring this up as often and publicly as possible through our Governance and Community calls. I also hope to see discourse and dialogue around this through the Forum.

Depending on the level of engagement to this RFC, we could host a POP V2 Workshop in January 2023 should the Community believe that would be of use to better understand this RFC, provide live feedback, and ensure alignment before moving to a proposal.

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The POP V2 Proposal Template is really clear and overall this process seems clear while being community governed which is a real win for the RWA Space and for prospective pools.

I would be interested to hear from some of the groups that submitted POPs in V1, also existing issuers and those who are interested being involved in future pools

What changes for you with POP2?
Is there anything you’re not clear on?

@Will_Coleman @OgTheKingOfBashan @LendEast @DarrylSteyn any thoughts on how this improved POP process might affect you?

@Ilhan please refer your contacts here

:cyclone: :ok_hand:

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Good day ctcunning
Nice work. Looks like POP V2 is much simple than POP V1:

image
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VS
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gd9xcBp_d3iu9TQAkheg4ecuSZdTi_aPsbVzLWMJJecGIt2njPIN4x7r-1vGQY4nHUqSGeJOBNCnZcVi0FFXXoKOG_wyQUvGMHyOwjveAF43k1JpGLehhWKkaICr6QyhpeNGmZKO1600Ă—95 40.2 KB

A lot of steps were removed but the essence remained the same. Great work!

I have a couple of questions regarding this proposal.

  1. From the governance side I see that something could be improved or add to this RFC.
    I see the steps for onboarding POOL, but what is the procedure for pool offboarding? Why this procedure is not included in RFC POP V2?
    Once POP V2 will pass all governance steps and will be included in CP as CP-5 any additional changes will require time and additional voting.
    I would suggest including and describing the procedure of offboarding already in this proposal in order to save time and effort in the future.

  2. The POP Criteria remained the same as in POP V1?

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image
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## Stage 4 - Launch
4 Pool Launch: If the On-Chain vote (3.3) passes, the Pool is launched.
  • What is step 3.3 corresponding for?

If the On-Chain vote

  • Stage 3 - Approval require on-chain voting?

The V2 process is simpler, provides on-chain voting to CFG token holders, and places the Credit Group more prominently into the process, to report on each POP.

What does this mean? :face_with_raised_eyebrow:

On-chain voting means Opensquare Snapshot or approval via democracy proposal on-chain?

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Great to see the improval of the POP-process based on feedback from different involved parties. What happens with the running POP-submissions from V1? Do they need to switch to V2?

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For point 1, I’d like to see a solution proposed as I think this makes a lot of sense.

Point 2 - this proposal reframes “scoring criteria” into “guidance”. Also the information is different and the guidance is more subjective.

Ultimately the community discussion, the Credit Group report, and the commitment from the POP to execute this will determine success. Not objective scoring.

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3.3 no longer exists and has been condensed simply into stage 3.

On chain voting has also been removed and is now simply opensquare snapshot.

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What would you propose here @Tjure07 ?

My sense is that initial POPs are perhaps exhausted / disillusioned with what happens through V1 and the difficult of sourcing credit lines on chain.

I hope I’m wrong.

Perhaps we can invite those POPs to speak candidly on what they’d like to see the community do?

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I would recommend to proceed as follows:

  1. The POP-submissions “on hold” which have a serious chance to proceed to the next steps I recommend they should post a new submission within v2 and start from anew (depending on the status/step of their submission). Otherwise we have a mix between old and new which could be confusing
  2. To “clean up the forum” we should think about to move the declined submissions (without a chance to proceed) to a folder such as “deprecated submissions”

We appreciate every submission so far but need to find a way how to deal with POPs which didn’t pass and close them

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Thank you for your answer.
Before the submission to Github would be great to correct all information that no longer exist and correct on-chain vote with Opensquare Snapshot to avoid any misunderstanding in the future.

i’m definitely not an expert in POP, but i can share my vision.

CP-5.1 (OPP) Offboarding Pool Proposal

(Using the same acronym Pool Offboarding Proposal was intentionally avoided)

In order to offboard a pool a proposal has to be created.

This can happen in two ways (suggesting requested if i missed something):

  1. The Pool no longer wants to operate by itself.
  2. The Community/DAO wants to offboard the Pool.

In the first case, a few things we can do and we can not force the pool to operate, so this is completely the right of Pool to ask for offboarding and this also, in my opinion, could help Centrifuge DAO to prepare everything in advance (Legal stuff, engineering task and etc. whatever else).

I think that pool should inform in advance Centrifuge in the first case and give Centrifuge time to offboard it. I’m not sure this could be written in the contract and forced to respect this point, but I think that this would be great.

I.The Pool no longer wants to operate by itself.

GOVERNANCE PROCESS

The group/individual itself no longer wants its mandate within the DAO

STEP DESCRIPTION DURATION
1 Create a post (CP-5.1) on the Forum with an explanation of offboarding. 14/30 days (double check with eng and legal team)
2 Submit proposal to the Centrifuge Proposals Repository (on Github) to get a pull request # -

*i indicated 14/30 days in order to give time to the engineer and legal team, probably this step could be avoided. (please comment on)

Once the announcement has been made, and the proposal has been submitted to the Centrifuge Proposals Repository, the Centrifuge DAO will initiate the Pool offboarding from cent-chain.

II. The Community/DAO wants to offboard the Pool.

Here i think we should describe the case and motivation why this could happen: for example, continuing to delay in repayment and etc.

  1. The Community/DAO wants to offboard the Pool.
STEP DESCRIPTION DURATION
1 Create a post (CP-5.2) on the Forum with an explanation of offboarding. Minimum days 14 days
2 Submit proposal to the Centrifuge Proposals Repository (on Github) to get a pull request # -
3 Create a snapshot vote on OpenSquare Minimum 14 days
4 Create a Proposal post -

If the snapshot vote passes (majority of CFG vote to offboard the Pool ), the Pool should be offboarded from Cent Chain.

I think that the minimum duration should be 30-45 days for this procedure in order to give the Issuer chance to explain and in order to avoid spamming or bad actions vs Pools.

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Thanks @Kate_Bee ! I will review this over the weekend and follow up with my feedback by early next week :+1:

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Hi Kate,

Formalising POP through onchain interaction and CFG governance makes absolute sense and should improve the expected and then executed onboarding experience for an applicant through the DAO. It should also help bring clarity for applicants in terms of “who” they are addressing throughout the process.

I do think that at least 1 of the stage 2 items should be mandatory to keep the DAO involved via either its elected, qualified, and remunerated representation in the form of the Credit Group and its report, or through the direct interaction made possible by a Pool Party. This seems like an important step to allow both the applicant and the DAO to ensure an alignment of interests and expectations and address any concerns that may have been missed in the POP Post before voting.

Looking forward to what comes next!

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Hola here!
Another question related to scoring, Snapshot vote and onboarding information.

Right now for each step req. separate topic (In my opinion useless and just create misunderstanding).
I would like to suggest making all information regarding the POP in 1 topic:

  1. Introduction
  2. Q/a
  3. Scoring
  4. Credit group opinion (optional)
  5. Opensquare Snapshot
  6. Onboarding

In this way, anyone who is not familiar with the process can read and check only 1 topic without jumping from 1 topic to another in search of information.

Do any changes have happened in POP V2 regarding this?

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I actually like the idea of having all the information in the same topic - my only concern is whether the amount of information would be too overwhelming.

But I definitely don’t think each of the points above should have their separate topic on the Forum. If it is too much to add all of it in the same post, we could split it up into two posts maximum.

@ctcunning Another thing that I think we should consider is whether to submit the POP submissions to the Proposal Repository on GitHub, where all other Governance Proposals (CPs) are submitted before they can proceed to an OpenSquare Snapshot/on-chain vote.

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Let’s streamline as much as possible.

We should only send to GitHub those POPs that have a report from Credit Group to begin with.

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I think this makes a lot of sense to streamline the process so the POPs mimick the other CPs.

I agree with this. However, a POP should be submitted to GitHub before the issuer creates the OpenSquare Snapshot, to keep it consistent with our Governance Process in general.

I think it is important to mention this explicitly in the POP V2.

If this proposal for POP V2 passes, we will create a folder on our Proposal Repository called CP5, where all POP submissions can be uploaded to.

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Updating docs now with this feedback - please ensure it’s a part of your feedback / notes as well.

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I really like this proposal overall. I’m a big fan of simplicity and I think this further streamlines the simplicity of a POP. We just recently filled out a POP on the current version and while it wasn’t too overwhelming it was a bit of a learning curve and seemed like a lot of steps. This process is easier to understand and seems less intimidating, well done @ctcunning.

Also @Tjure07, personally I like the idea of Current POP’s that have already submitted be pushed on to Stage 2 of this newly proposed version however I do think it’s a good idea to have us issuers re submit our POP to keep things simple. We would be happy to resubmit to keep things clean in the forum and avoid confusion.

I’m happy to answer any other direct questions you guys may have for us on the new proposal but overall I’m in favor of it as currently proposed.

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@Tjure07 - I agree with both.

However, we should not “deprecate” existing POPs until the POP V2 has been officially accepted through governance in an on-chain vote.

I think all POPs have been sufficiently discussed, and the majority are no longer active.

There are a couple of actively discussing in the forum and we should ensure we communicate this transition process properly.

But this is secondary to the POP itself and I believe Facilitators could lead a transition process publicly through the Forum once/if the POP V2 is accepted.

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Absolutely agree here to wait until V2 of the POP officially goes live after the governance approval. The transition will and should be communicated once V2 is active. I will prepare a forum post how to proceed with POPs from V1 which didn’t show any activity for several months

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