Introducing Marinade V2: The next chapter for Solana staking and MNDE
Marinade is evolving and growing, read more in this article.
As highlighted by last week’s mSOL Directed Stake launch, Marinade continues to build its way out of the 2022–23 bear market. We can point to real signs of progress like Solana’s chain performance and the relaunches of DeFi protocols like Solend and Mango, combined with new projects and migrating ones like Helium and Render. We’ve also observed an increase in Solana’s Nakamoto Coefficient to 34, pointing to an even greater decentralization of the network overall.
There has also been more interest in liquid staking so far in 2023, thanks in part to Ethereum’s Shangai upgrade introducing liquid staking to the former Proof-of-Work chain, and more awareness of the liquidity issues Solana faces in the wake of the FTX-Alameda collapse, and how locked stake is impacting the liquidity for the ecosystem.
Marinade has been around for about two years now since being founded through grants in the spring of 2021. It launched the Solana liquid staking product live on to mainnet in August 2021 and its DAO governance in the spring of 2022. Along the way, we’ve experienced, tested, asked, and learned a lot. Marinade has been working closely with the Solana community, from stakers to validators and many others, and gathered feedback on the delegation strategy, web app, staking program, tokenomics, and governance mechanics.
Reflecting on all the learnings and with improvements to Solana core and its roadmap in mind, we’re preparing to launch an updated version of Marinade — Marinade v2.
What’s new in Marinade V2?
Marinade V2 connects items already built with several other key initiatives that will launch later this year.
Here are 2023 Roadmap highlights so far:
✅ Saga Solana mobile phone DApp
✅ Update to MNDE allocations and milestones
✅ Stake Pool Delegation Strategy Revamp
And here’s what is coming up next this year:
In Marinade V2, the delegation strategy is now split in the following way:
Marinade has developed its in-house system to transparently track validators’ performance over time, which you can track on the Validator Dashboard. This way, Marinade can stake with the most robust and rewarding validators and swiftly identify the malicious ones that take advantage of their stakers or degrade the network (e.g., vote lagging).
Marinade’s new version will put the tracking system into full effect and include Solana’s redelegate feature. This will enable Marinade to instantly rebalance any stake without cooling it down which causes a reduction of staking rewards. That means even better staking rewards for all mSOL holders.
Staking 360: A product for all Solana stake
Liquid staking adoption on Solana has remained largely flat during the bear market. While 70% of SOL is staked, only about 2% is liquid staked despite its unique composabilty. In conducting many interviews and surveys about reasons why, several common themes from these participants emerge: taxable events, smart-contract risk, or the desire to support a single validator.
If you’ve been paying attention to what Marinade has been building, numerous items completed are lining up to serve as the foundation of what’s next. The Validator Dashboard, delegation strategy, directed stake, The Decentralizer (launched in 2022), and the Solana Snapshots grant completed in 2023, combined with a website revamp will be rolled up, optimized, and repackaged as Staking 360: This product will deliver the most comprehensive staking homepage on Solana, enabling you to stake your SOL anywhere you’d like — native or liquid, to one validator or multiple, while utilizing the most robust transparent tools available in the ecosystem.
Here’s what Staking 360 looks like:
A suite of products will be combined and optimized to present a full picture of Solana staking.
Staking is fundamental to Solana’s prosperity, and with 70% of SOL already staked, Marinade wants to use its learnings and public goods tooling created like the Validator Dashboard to facilitate smarter staking for everyone in the ecosystem.
mDAO Governance updates and MNDE
A more robust product offering opens the door to even more opportunities in the mDAO through the MNDE token and on-chain tooling through Realms.
Marinade is continuing its governance infrastructure upgrade from Tribeca to Realms, which was built by Solana Labs and Mango Markets, to more closely and transparently connect mDAO governance with the MNDE token as well as the rest of the growing number of Solana communities on Realms.
Phase one, moving two multisigs and ratifying the code of conduct and constitution, is complete. But that’s just the start. Marinade V2 will operate under the following governance system:
These changes will not only simplify but bring more efficiency to the governance system. | Keep up on the latest Marinade governance on Realms
Here’s how Marinade Council votes are displayed and executed on Realms.
MNDE token design
Two main factors of any token design are allocation and incentives. Since launching MNDE as a fair-launch token in October, 2021, we’ve learned many lessons. In Marinade V2, we’re tackling the main issues and rethinking (or simplifying) token design. Here are the main changes:
1. Allocation
We started by distributing 35% for bootstrapping the community, 35% for the treasury, and 30% for the team with a 6-month delay followed by two years of linear vesting.
As part of revisiting incentives, we recently decided to stop vestings for the team at the already vested 7.5% and only allow further unlocks when we get to grow the total value locked at Marinade. This means unlocking team tokens from time-based to performance-based to better align with the Marinade DAO.
The new simplified MNDE token split will become the following:
2. MNDE token buybacks
Currently, all Marinade protocol fees cover operations. Once the monthly revenue exceeds operational expenses, it will be possible to buy back MNDE from the market if the community proposes and approves it.
3. MNDE token ownership
MNDE holders that stake their tokens in governance will ultimately control and decide over the MNDE treasury and the Marinade program. The team will request funding through the DAO proposals. The liquidity mining program will be moved to the case-by-case MNDE grant proposals bounded by time.
We can sum up MNDE’s utility as follows:
The road thus far has provided the Marinade Chefs a clear focus to work on what matters most: supplying the ecosystem with the best possible staking tools, and moving mDAO governance into the next chapter so the Solana community can truly take control of this community protocol.
As Marinade builds out these products and enhances its governance and MNDE token design, we want the Chefs to be with us every step of the way. Bring your questions about Marinade V2 and listen in to hear the Master Chefs share the grand vision for 2023:
