Overview

The Lybra protocol is governed by esLBR token holders, using three distinct components; the esLBR token, governance module, and Timelock. Together, these contracts allow the community to propose, vote, and implement changes to the lybra protocol.

Any addresses with more than 0.1M esLBR (0.1% of total supply) delegated to it may propose governance actions, which contain finished, executable code.

When a proposal is created, the community can cast their votes during a 7 day voting period. If there are more 'For' votes than 'Against' (i.e. a simple majority), and the number of 'For+Abstain' votes >4M (meeting the quorum), it is queued in the Timelock, and may be executed in a minimum of 2 days.

Governor

Initially, we will build a Governor without a timelock. The core logic is given by the Governor contract, but we still need to choose: 1) how voting power is determined, 2) how many votes are needed for quorum, 3) what options people have when casting a vote and how those votes are counted, and 4) what type of token should be used to vote. Each of these aspects is customizable by writing your own module, or more easily choosing one from OpenZeppelin Contracts.

For 1) we will use the GovernorVotes module, which hooks to an IVotes instance to determine the voting power of an account based on the token balance they hold when a proposal becomes active. This module requires as a constructor parameter the address of the token. This module also discovers the clock mode (ERC6372) used by the token and applies it to the Governor.

For 2) we will use GovernorVotesQuorumFraction which works together with ERC20Votes to define quorum as a percentage of the total supply at the block a proposal’s voting power is retrieved. This requires a constructor parameter to set the percentage. Most Governors nowadays use 4%, so we will initialize the module with parameter 4 (this indicates the percentage, resulting in 4%).

For 3) we will use GovernorCountingSimple, a module that offers 3 options to voters: For, Against, and Abstain, and where only For and Abstain votes are counted towards quorum.

Besides these modules, Governor itself has some parameters we must set.

votingDelay: How long after a proposal is created should voting power be fixed. A large voting delay gives users time to unstake tokens if necessary.

votingPeriod: How long does a proposal remain open to votes.

These parameters are specified in the unit defined in the token’s clock. Assuming the token uses block numbers, and assuming block time of around 12 seconds, we will have set votingDelay = 1 day = 7200 blocks, and votingPeriod = 1 week = 50400 blocks.

We can optionally set a proposal threshold as well. This restricts proposal creation to accounts who have enough voting power.

Governor Timelock Control