3.3 KiB
| type | entity_type | name | domain | status | parent_entity | platform | proposer | proposal_url | proposal_date | resolution_date | category | summary | tracked_by | created |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| entity | decision_market | MetaDAO: Develop AMM Program for Futarchy? | internet-finance | passed | metadao | futardio | joebuild | https://www.futard.io/proposal/CF9QUBS251FnNGZHLJ4WbB2CVRi5BtqJbCqMi47NX1PG | 2024-01-24 | 2024-01-29 | mechanism | Proposal to replace CLOB-based futarchy markets with AMM implementation to improve liquidity and reduce state rent costs | rio | 2026-03-11 |
MetaDAO: Develop AMM Program for Futarchy?
Summary
Proposal to develop an Automated Market Maker (AMM) program to replace the existing Central Limit Order Book (CLOB) implementation in MetaDAO's futarchy system. The AMM would use liquidity-weighted price over time as the settlement metric, charge 3-5% swap fees to discourage manipulation and incentivize LPs, and reduce state rent costs from 135-225 SOL annually to near-zero.
Market Data
- Outcome: Passed
- Proposer: joebuild
- Created: 2024-01-24
- Completed: 2024-01-29
- Budget: 400 META on passing, 800 META on completed migration
- Timeline: 3 weeks development + 1 week review
Technical Scope
Program changes:
- Write basic AMM tracking liquidity-weighted average price over lifetime
- Incorporate AMM into autocrat + conditional vault
- Feature to permissionlessly pause AMM swaps and return positions after verdict
- Feature to permissionlessly close AMMs and return state rent SOL
- Loosen time restrictions on proposal creation (currently 50 slots)
- Auto-revert to fail if proposal instructions don't execute after X days
Frontend integration:
- Majority of work by 0xNalloK
- Mainnet testing on temporary subdomain before migration
Significance
This represents a fundamental mechanism upgrade for MetaDAO's futarchy implementation, addressing three core problems with the CLOB approach:
- Liquidity: Wide bid/ask spreads and price uncertainty discouraged limit orders near midpoint
- Manipulation resistance: CLOBs allowed 1 META to move midpoint; VWAP vulnerable to wash trading
- Economic sustainability: 3.75 SOL state rent per market pair (135-225 SOL annually) vs near-zero for AMMs
The proposal explicitly prioritizes simplicity and cost reduction over theoretical purity, noting that "switching to AMMs is not a perfect solution, but I do believe it is a major improvement over the current low-liquidity and somewhat noisy system."
The liquidity-weighted pricing mechanism is novel in futarchy implementations—it weights price observations by available liquidity rather than using simple time-weighted averages, making manipulation expensive when liquidity is high.
Relationship to KB
- metadao.md — core mechanism upgrade
- MetaDAOs Autocrat program implements futarchy through conditional token markets where proposals create parallel pass and fail universes settled by time-weighted average price over a three-day window — mechanism evolution from TWAP to liquidity-weighted pricing
- futarchy adoption faces friction from token price psychology proposal complexity and liquidity requirements — addresses liquidity barrier
- futarchy is manipulation-resistant because attack attempts create profitable opportunities for defenders — implements explicit fee-based defender incentives