Forced minipool exits

Pre-RPIP discussion of how RocketPool may use EIP-7002, exits initiated by the withdrawal address.

The withdrawal address in RocketPool’s case is a smart contract, so first: What are the mechanics of a smart contract initiating a withdrawal? Can it actually? I thought only EOAs could sign anything.

Provided there is a path, how should RocketPool use it?

  • Dissolve inactive minipools. With thresholds - start pinging on Discord at N weeks of inactivity (2?), put NO on notice at N2 weeks of inactivity (4?), forcibly dissolve minipool at N2 weeks of inactivity (12?)

  • MEV theft. Currently RocketPool has a 3 strikes rule for penalties. Regardless of what happens to penalties, create a 3 strikes rule for force-dissolution. 1 instance of theft, warn NO. 2nd instance, warn again with note that next instance will force-dissolve. 3rd instance, forcibly dissolve the minipool. The protocol protects itself - an NO who remains unaware across 3 proposals should likely step up their game; and we need a way to remove minipools in case of malicious, not accidental, theft.

Do not dissolve minipools for reasons of deposit pool liquidity. Let arbitrage incentivize NOs to dissolve minipools and thus make liquidity available for people who want out of rETH. Also the incentives committee have levers to pull. We don’t need to force-exit, unlike other LSTs with permissioned NOs.

:+1: to remove inactive (though I’d prolly go with veeery long timelines myself)

:+1: not for liquidity

:-1: MEV theft kicks. I don’t feel comfortable with using it for MEV theft while that’s an oDAO duty. It increases trust in oDAO quite a lot as they would be able to penalize arbitrarily and kick to harvest the penalties. This would be fine if it could be fraud-proofed, but I don’t think we’re there yet. Knoshua’s work at Guardrails - MEV Penalties - Analysis of oDAO Duties for sooome mitigation and MEV Stealing Proofs - Analysis of oDAO Duties for a real path to “solved”

Agreed that dissolving for MEV theft shouldn’t be an oDAO duty. We want fewer, not more duties.

We’ll have beacon block roots this hardfork and 7002 after that - the timing works. Remove MEV penalty duty from the oDAO and while doing so keep the concept of dissolving for MEV theft in mind.

Then when 7002 is live, see how it could be used in a non-exploitable fashion to stop on-going MEV theft.

Interesting point on MEV burn btw. I think that and ePBS are separate but connected ideas - ePBS unlocks MEV burn, doesn’t mandate it. And yes that could potentially remove this duty altogether, from anyone. Until then, we need a way to handle it, that doesn’t require the oDAO.