5table Finance introduces Governance

Security is a top priority at 5table Finance, and we work with the highest standards in the industry to ensure that our users are safe while using our protocol.

Unlike most other projects, we have not audited just one contract, but all the contracts involved in our protocol (12 smart contracts). This choice of auditing the whole protocol is a clear sign that we care about security for real and we work to improve it.

All the issues that were found in the audit report were addressed and solved, but one important issue needed a bigger development to be solved efficiently without having a negative impact on the operation of the protocol.

What was this issue about?

Our main stablecoin vault uses a strategy contract that executes multiple operations automatically, turning that stablecoins into different stablecoins LPs and staking them across different farms and platforms.

Until now we were able to change those farms as we consider best without any restrictions, aiming to have a dynamic approach that could allow us to provide the most efficient strategy and therefore the highest APY on the whole network. But with that approach, there was a centralization risk, because we were able to move funds around without restrictions.

The solution

We needed to build a solution that eliminates centralization risks at the same time that we could continue to move funds around different farms dynamically looking for the best opportunities.

We came up with a DAO-related solution that involves governance from the holders. This way we can continue to add new farms and change allocation but only after the holders of the token approve (or not) that decision.

After building the solution, we have tested it heavily because it is an extremely sensitive feature to deploy since it implies renouncing ownership of the contract. Now the governance feature is deployed and all the holders can vote on the path of 5table Finance protocol.

The governance feature will not only be to decide the stablecoin vault strategy, but also for other important decisions about 5table Finance protocol

How does the governance feature actually work?

There are some things that we will still be allowed to do and some others that we won’t and will be subjected to vote among the holders.

We will be able to add new strategies contracts (new farms) to the main strategy contract of the vault, but with 0 (zero) allocation. This will allow us to later propose the votes including the new recommended farms.

The holders will be able to vote on the following things about the main stablecoin vault:

  • A) Change the allocation of funds between the existing farms.
  • B) Move funds from one farm (X) to another farm (Y).
  • C) Options A & B combined: Change the allocation of funds between the existing farms, and move funds from a farm (X) to another farm (Y).

Holders will be also be allowed to vote on different decisions about the protocol path, future developments, and any decision around 5table Finance future. There will be decisions of different grades of importance here, and more governance features will be deployed in the future to build a more democratic protocol.

Every vote will last 48 hours, and we will announce it on all our channels so everyone can get informed about it and vote. If the necessary quorum is achieved and the “Yes” wins, there are another 48 hours until the contract executes that action, providing time for everyone to do as it please according to the result.

The necessary quorum to move on with each Vote and make it valid is 14.28%

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