[PROPOSAL #82][REJECTED] ATOM 2.0: A new vision for Cosmos Hub

Sorry in advance, my answer is long, translated into English initially, then into the original French afterwards:

Hello Lexa, I looked at other proposals, I notice that it is a usual formula in those made by your team.
So I come back to a simple “no”.
As for Proposition 81…
I don’t feel alone at all… ^^
I still think that last paragraph is a really bad idea.
I don’t find myself in this one (that would be impossible of course), and it makes me feel trapped in someone else’s vision. As if the meaning of my vote had been taken away from me.
There is obviously no room, and that is normal at this stage, for “I agree, but I think the proposal has to go back to the anvil, several times”, or “there is a good idea in proposition 81 which should be tested: a gradation of majorities according to the importance of the subject and the timing”.
It is therefore already difficult enough for everyone to fit all their opinion into a single box, therefore towards a single consequence, to see themselves disguised in addition to this opinion.
You could say that it’s anecdotal, and that I got upset for nothing, but believe me, if I felt this distraught, I may not be the only one.

This also touches on a point that is particularly close to my heart:
The governance.
The characteristic of a revolution is that we cannot imagine what its consequences will be.
On the other hand, we can try to observe what surrounds us, and what it changes there:
Which habits, anchored so deeply that we confuse them with reality, will disappear, like the automatic search for a trusted third party.
What paradigms it completely lays bare, like currency and the simple consensus on which it is based.
What preconceptions it completely destroys: In a few years, “digital” and “virtual”, in the same sentence, will seem incongruous.
Which concepts it changes in order of magnitude, such as game theory.
What technologies are profoundly modified, such as the internet.
What concepts are intertwined, such as math and trust.
Finally, what will be our future relationship to information, in the mathematical/physical sense of the term.
In short, I forget some, I have my limits, like any individual, and I am also very wrong.

But I believe something has also been forgotten, from those who have their heads in the code, to those who saw light and walked in to make a ticket.

I know of no example in the history of mankind where the problem of the Byzantine generals has been solved on a comparable scale, with such guarantees, nor such scalability.
In other words, no group, pirate crew, tribe, company, city, nation, has ever had similar tools to build and improve its governance:
A trustless consensus engine whose complexity and efficiency of the algorithm has theoretical limits only those of mathematics.
In a battle, each point of concentration of decisions is a flaw of the same size, the only reason that keeps this hierarchical system going is efficiency.
We have already tried in the past to code efficient systems, but without any scalability or predictability, and the code almost got corrupted when it left the constituent assemblies… In addition to being so subject to the stacking of protocols and boring to modify that each time it took a change of regime to code a new one…
While we are talking here about a governance tool that can link fluidity, responsiveness, with the strength of consensus and resilience.
The holy grail for the revolutionary, as for the anarchist or the strategist.
Infinitely scalable, modifiable, adaptable, testable. With a complete history, to put the work back on the job again and again.
And if it’s not the blockchain that delivers, it will be quantum computing with its big cryptographic clogs.
Bitcoin, “fix the money first”, did the job, and its value proposition was known from the start.
Etherum, “code is law”, is still in the discovery phase, revolutionizes finance, the digital object, but misses in my opinion the DAO, not for a problem of code or research, but for a question of culture:
We do not improvise an “ex nihilo” consensus engine between such different actors and objectives, even with the best algorithm in the world, Bitcoin has proven that it is in pain and friction that a community is created and consolidates.

And Cosmos in all this?
Well for me, Cosmos is currently where this thing can happen, this third step:
Take advantage of the newly available tool, to already fix what is known and which has always posed problems in governance, and perhaps later invent new solutions.
Let’s agree: I don’t expect Cosmos to revolutionize the world, make coffee, and bring me croissants…
Nor that it does anything other than what it was designed for by its creators, or desired by the community.
On the other hand, I think that the entire ecosystem needs a real job to be done on this subject, which takes advantage of the new tools available.
Otherwise, others will seize it, and we will end up with empty pockets, as a footnote in the history books.
Here is, basically, the cause of my annoyance and my presence in this post:
For me, it’s not so much Atom 2.0 that matters, but how we get there.
Not for philosophical or altruistic reasons, but for a simple strategic approach to risk in a dangerous, complex, and surprising environment.
To create a decision-making culture that we can rely on when our survival depends on it.
So the drama “it’s the community that decides on two unsuccessful things because we’re angry and we can’t talk to each other anymore”, that pissed me off a bit.
That was long, thanks for reading.

Bonjour Lexa, j’ai regardé d’autres propositions, je remarque que c’est une formule habituelle dans celles effectuées par ta team.

Je reviens donc à un simple “non”.

Comme pour la proposition 81…

Je ne me sens pas du tout seul… ^^

Je pense toujours que ce dernier paragraphe est une très mauvaise idée.

Je ne me retrouve pas dans celui-ci (ce serait impossible bien sûr), et cela me fait me sentir piégé dans la vision de quelqu’un d’autre. Comme si le sens de mon vote m’était enlevé.

Il n’y a évidemment pas de place, et c’est normal à ce stade, pour “je suis d’accord, mais je pense que la proposition doit retourner à l’enclume, plusieurs fois”, ou “il y a une bonne idée dans la proposition 81 qui devrait être testée : une gradation des majorités selon l’importance du sujet et le timing”.

C’est donc déjà assez difficile pour chacun de faire entrer toute son opinion dans une seule case, donc vers une seule conséquence, pour en plus se voir travesti cette opinion.

On pourrait dire que c’est anecdotique, et que je me suis énervé pour rien, mais crois-moi, si je me suis senti aussi désemparé, je ne suis peut-être pas le seul.

Cela touche également un point qui me tient particulièrement à cœur :

La gouvernance.

Le propre d’une révolution, c’est qu’on ne peut pas imaginer quelles seront ses conséquences.

Par contre, on peut essayer d’observer ce qui nous entoure, et ce qu’elle y change :

Quelles habitudes, ancrées si profondément qu’on les confond avec la réalité, vont disparaitre, comme la recherche automatique d’un tiers de confiance.

Quels paradigmes elle remet complètement à nu, comme la monnaie et le consensus simple sur lequel elle repose.

Quels a-prioris elle détruit complètement : Dans quelques années, « numérique » et « virtuel », dans la même phrase, cela paraitra incongru.

Quels concepts elle fait changer d’ordre de grandeur, comme la théorie des jeux.

Quelles technologies sont modifiées en profondeur, comme internet.

Quels concepts se trouvent intriqués, comme les mathématiques et la confiance.

Finalement, quel sera notre rapport futur à l’information, au sens mathématique/physique du terme.

Bref, j’en oublie, j’ai mes limites, comme tout individu, et je me trompe aussi beaucoup.

Mais je crois que quelque chose a aussi été oublié, depuis ceux qui ont la tête dans le code, jusqu’à ceux qui ont vu de la lumière et sont entrés se faire un billet.

Je ne connais pas d’exemple, dans l’histoire de l’humanité, où le problème des généraux byzantins a été résolu à une échelle comparable, avec des garanties pareilles, ni une telle scalabilité.

Autrement dit, aucun groupe, équipage pirate, tribu, entreprise, ville, nation, n’a jamais disposé d’outils semblables pour construire et améliorer sa gouvernance :

Un moteur de consensus trustless dont la complexité et l’efficience de l’algorithme n’a de limites théoriques que celles des mathématiques.

Dans une bataille, chaque point de concentration des décisions est une faille de même grandeur, la seule raison qui fait perdurer ce système hiérarchique est l’efficience.

On a déjà tenté par le passé de coder des systèmes efficients, mais sans aucune scalabilité, ni prédictibilité, et le code s’est corrompu quasiment à la sortie des assemblées constituantes… En plus d’être tellement sujet aux empilements de protocoles et chiant à modifier qu’il a fallu à chaque fois un changement de régime pour en coder un nouveau…

Alors qu’on parle ici d’un outil de gouvernance qui peut lier la fluidité, la réactivité, avec la force du consensus et de la résilience.

Le graal pour le révolutionnaire, comme pour l’anarchiste ou le stratège.

Infiniment scalable, modifiable, adaptable, testable. Avec une historique complète, pour remettre encore et encore l’ouvrage sur le métier.

Et si ce n’est pas la blockchain qui livre, ce sera l’informatique quantique avec ses gros sabots cryptographiques.

Bitcoin, « fix the money first », a fait le job, et sa proposition de valeur était connue dès le départ.

Etherum, « code is law », est encore en phase de découverte, révolutionne la finance, l’objet numérique, mais rate à mon avis la DAO, pas pour un problème de code ou de recherche, mais pour une question de culture :

On n’improvise pas un moteur de consensus « ex nihilo » entre des acteurs et des objectifs si différents, même avec le meilleur algorithme du monde, Bitcoin a prouvé que c’est dans la douleur et le frottement qu’une communauté se crée et se consolide.

Et Cosmos dans tout ça ?

Et bien pour moi, Cosmos est actuellement l’endroit où cette chose peut se passer, cette troisième étape :

Se saisir de l’outil nouvellement à disposition, pour déjà fixer ce qui est connu et qui a toujours posé problème dans les gouvernances, et peut-être plus tard inventer des solutions nouvelles.

Qu’on soit bien d’accord : je n’attends pas de Cosmos qu’il révolutionne le monde, fasse le café, et m’apporte les croissants…

Ni qu’il fasse autre chose que ce pour quoi il a été pensé par ses créateurs, ou souhaité par la communauté.

Par contre, je pense que l’écosystème entier a besoin qu’un vrai boulot soit fait sur ce sujet, qui se saisisse des nouveaux outils à disposition.

Dans le cas contraire, d’autres s’en saisiront, et on finira les poches vides, en note de bas de page dans les livres d’histoire.

Voilà, fondamentalement, la cause de mon énervement et de ma sortie dans ce post :

Pour moi, ce n’est pas tellement Atom 2.0 qui compte, mais comment on y arrive.

Pas pour des raisons philosophiques ou altruistes, mais pour une simple approche stratégique du risque dans un environnement dangereux, complexe, et surprenant.

Pour se créer une culture de la décision sur laquelle nous pourrons compter quand notre survie en dépendra.

Du coup le drama en mode « c’est la communauté qui tranche sur deux trucs pas aboutis parce qu’on est fâchés et qu’on arrive plus à se parler », ça m’a un peu gonflé.

C’était long, merci de m’avoir lu.

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Why All in Bits Recommends a Strong No with Veto on Prop 82

After careful thought and consideration, All in Bits (AiB) recommends the Cosmos community cast a strong No with Veto vote on prop 82, ATOM 2.0.

As co-creators of Cosmos and its longest-standing contributor, AiB has a duty to safeguard the development of the Hub and protect the interests of the community at large. Unjustified changes to monetary policy deprioritize ATOM holders and fail to preserve Cosmos’ core values of accountability and transparency; while unproven experimental ideas and lack of prudence in proposed designs place the security of the Hub at risk. We are working to build a viable lasting alternative to the current financial system. Prop 82 recreates many of the existing problems we’re fighting so hard to resolve.

Innovation Should Not Compromise Economic Security

Cosmos has grown from an idea in a whitepaper to a flourishing ecosystem of independent interconnected chains – the Internet of Blockchains. At AiB, we are proud to have incubated, collaborated with, mentored, and learned from some of the brightest minds in the blockchain space and visionaries in their notions of Proof of Stake and governance. Ideas are the lifeblood of the community and Cosmos has evolved through their continued innovation. Yet, this innovation has always been carefully considered and adopted (or not) thanks to our advanced system of governance that ensures appropriate checks and balances are observed.

We believe that some ideas laid out in the ATOM 2.0 whitepaper hold merit and are worthy of exploring. However, these types of unproven and experimental suggestions should not be implemented directly on the Hub (and, not all at once). Neither should they be rushed through in an omnibus whitepaper but broken down into components to assess by individual merit. We have seen time and again through multiple examples of bleeding-edge iteration that high innovation can come at a high cost; most often, to the token-holding minority.

Observing the conservative, predictable, and minimal development of the Hub guarantees the economic security of all. We can continue to deliberate the concepts in prop 82, and we can implement them carefully, unhurriedly, and one by one. Should any of them fail, we ensure that the entire ecosystem is not endangered. Take the Interchain Allocator or Interchain Scheduler as examples. These proposals are innovative and may result in generating value for the Hub. However, they are untested and unproven; we have not conducted suitability tests and have no means of knowing whether they will work or generate value.

Liquid staking, while attractive to many participants in the ecosystem, poses a plethora of security concerns that must be addressed. Staked ATOM tokens deployed in DeFi can easily be lost through bad trades or liquidations at lending protocols. The amount of liquid staked tokens should therefore be limited to reduce systemic risk, primarily by limiting interchain accounts. It’s also possible that liquid staking may not be safe at any level; liquid staking combined with shorting markets would incentivize employees or insiders of validator companies to sabotage their own validator employer. As far as we are aware, nobody has considered this risk factor, because not enough attention is paid to designing safe systems.

Let’s remember, Cosmos Hub’s greatest strengths are stability and security – as demonstrated by its resilience to the collapse of Terra LUNA in May 2022 – nothing should interfere with these core attributes.

“ FTX <–> Alameda compounding is exactly the kind of systemic risk that unchecked LS (liquid staking) will bring to Cosmos unless we are proactive in putting checks on it, such as by limiting ICA (Interchain Account) staking. Vote NoWithVeto on 82 to save Cosmos,” wrote Jae Kwon on Twitter.

Most of Cosmos Hub’s tokenomics or proposed future value generation for ATOM stakers relies extensively on Interchain Security (ICS). When launched, ICS is expected to allow ATOM holders to benefit from the launch of Consumer Chains that request security from the Hub and, in exchange, distribute part of their staking rewards to the Cosmos Hub community. When you have a strong value proposition for the Cosmos Hub that benefits from security as the main feature, it is essential to take the proper measures to ensure that security at all times.

Proposed Changes to Tokenomics Are Detrimental to ATOM Holders

Proposed changes to the tokenomics are unjustified, and the passage of proposition 82 for ATOM 2.0 creates a dangerous precedent of minting scandalous amounts of new tokens to a treasury controlled by a few selected members. The whitepaper does a disservice to public education because it fails to explain to Cosmonauts that the ATOM token is intentionally designed to NOT be a deflationary monetary token for the purpose of security – to ensure that ⅔ of ATOMs are bonded. In fact, ATOM 2.0 doesn’t prevent exponential ATOM inflation either for this exact reason, so it isn’t any more deflationary than before. This makes moot the premise for the up-front (and following proposed mint tranches) in the first place (at the time of the proposal, around $500M). In addition, the inflated ATOMs would go to a treasury that isn’t controlled by Cosmos Hub governance.

Instead, we should change the existing parameter of the tax rate from 2% to something higher, with the flexibility to execute slight modifications to the ATOM inflation model to remove the minimum inflation bound of 7%. With these simple changes, we could create sufficient funds for development going into the Hub governance-controlled community pool, and with the adoption of ICS over time the inflation rate would approach zero and may even become negative, making the ATOM effectively a deflationary token. Yet still, we can explore alternative models of supporting deflationary fee tokens such as that proposed in the ATOM One Constitution draft, or otherwise, simply support any of the many tokens of zones connected to the Cosmos Hub.

The Hub’s clear, predictable, and calculated tokenomics are not something we should underestimate, undervalue, or take for granted. Can the system be improved? We believe it can – through public conversations and open dialogue – and using the existing tools that were specifically designed for this very purpose.

Using the existing framework, we can further ensure the fair and transparent distribution of the funds – without changing the monetary policy or sacrificing decentralization. We encourage the community to draft competing plans for increasing the tax rate and managing the community pool to fund multiple competing DAOs for permissionless experimentation. How can we best ensure that approved DAOs are held accountable for performing work contracts funded by the community pool and approved by the Hub? Let’s find out.

Final Thoughts

The Cosmos Hub was created with a guiding vision to enable decentralization and transparency. These core values (along with accountability, security, and simplicity) have been fundamental to the ongoing success of Cosmos. Further, the Cosmos Hub was outlined in the original whitepaper, built, tested, and released piece by piece after multiple testnets and strenuous troubleshooting. Prop 82 places this methodology of prudence, transparency, and decentralization at risk.

AiB remains committed to the continued growth of Cosmos and upholding its core values. The only way to do this is by voting No with Veto on Prop 82 and finding a way to collaborate on a renewed effort on a new ATOM whitepaper. Let’s propose a better way to move forward that builds on our legacy rather than tears it apart.

For a call to action and more specific criticisms of the ATOM 2.0 proposal, take a look at Jae Kwon’s Call to Arms of True Cosmonauts.

By Cristina Cosmos

Notice: This content represents an official statement from All in Bits, and should not be confused with a statement made by the new Ignite entity.

10 Likes

Yeah ok :face_with_raised_eyebrow:. Everyone can see through this. Basically copy+pasted all of your boss’s thoughts and philosophy on this.

Don’t see why anyone should care what AiB thinks about the hub anyway, considering their abysmal track record with it the past few years.

Embarrassing that a founding org is being used as a pawn, frankly.

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They are presenting valid criticisms and supported opinions. your objection is like saying you use all the same math as your professor to solve equations…duh.
seems foolish not to accept new information and change your assumptions to more closely align with reality.

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I am still concerned this is too broad. Separate into each item to be voted on separately.
It is too much like Government stuff-in good/bad in the same bill to sneak things through. We should hone each major piece.

Specifically as we have seen the tokenomics is too big of issue to lump in. And has been discussed poorly on both sides. As you know, we have been defrauded enough times. I want what is best. Some of the assumptions are:

  • We need a community pool. - Other chains charge you to join, you need to get a communit behind you. (Polk-sama)
  • Trust in holders of the community pool - we are about trustless
  • Inflation - It sounds like it is recognized the ‘rapid coin minting’ (brrr) is okay be cause that goes to the stakers? (Or the stakers are not rewarded to off-set the inflation) and coins are diverted to the ‘community pool’ [much like government prints money for programs]).

Let projects raise their funds. If the Cosmos Hub team or others need money, then raise it from the community. Let the community TRULY, choose the projects with their support. (Stake-my-coins for a project and the project gets a %, or other ‘working together’ type programs).

Changing staking rewards is another topic. And should be directly proportional to minting and amount staked (so if you do massive print stakers still get the same %).
IBC - What was understood it would be ATOM % + others. (The others reward is highly questionable with the number of failures but saying they ‘make up’ for lost ATOM rewards. This another large topic before changing.).

I am not a fan of liquid staking it does cause unneeded instability/leverage. I hear you it is coming and hear whether I like it or not. And they are free to do it, but not sponsored by the chain. I would say liquid staking should have lower % since they are not committed to the same degree.

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The Flipside Governance Team has voted YES on Prop #82. Our full reasoning can be read on Medium on the Flipside Governance page.

Our tl;dr is that while Prop #82 is an imperfect proposal, it paves a way forward for the development of the Cosmos Hub. Advancement of the Hub has been stalled for too long, and it is much more risky to stakeholders to do nothing than to implement new modules while using treasury funds on onboard even more developers and community members.

While it is now looking unlikely that Prop #82 will pass, we will be around to support development of the Cosmos Ecosystem and look forward to what is to come next.

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does atom 2.0 have a reason not to use a photon type mechanism that is fixed supply and redeemable for atom through auction only up to a certain amount per month to avoid a native depeg and with no ATOM voting power? If capped supply, it would work similar to a savings bond because, assuming more Atom/month are bonded into photon than removed/month, the photon would mature over time to provide atom yield. it feels like 2.0 puts the interests of liquid staking providers before the interests of atom delegators.

This is what happens when the big fiat banks try to take control of the ideas and products of intellectuals.

After they destroy economies, like any kind of parasite they need to look for healthy new hosts : for an example of banks and crypto….

The fiat banks (in USA anyway), are almost all still underwater from the ‘illegal’ mortgage-backed securities market. Banks barely pay interest anymore…they are desperate to reinvent themselves. Look at JP Morgan acting as if they are all about defi (but regulated by banks)…isn’t it ironic?

I have loved ATOM project for years and hope they make the right choices.

Jamie Dimon: “As Bitcoin makes a slow pandemic-related recovery from its all-time high of $60,000, Jamie Dimon, CEO and chairman of JPMorgan Chase, says it’s “worthless” anyway.” Oct 12, 2021

JPMorgan Says Bitcoin Is Undervalued By 28%, Cryptocurrencies Are Now A ‘Preferred Alternative Asset’~ May 25, 2022

The crypto shift at JPMorgan ~JPMorgan has made strides to get more involved in the crypto industry since last year, when it gave its wealth management clients access to six crypto funds, including the Grayscale Bitcoin Trust.May 25, 2022

As for retail customers, Chase now integrates with major exchanges like Coinbase and has expanded its crypto offerings to include six crypto funds for its wealth management clients.Apr 18, 2022

Currently, CSI is the single provider that operates Infura which is dependent on Amazon’s cloud servers. This makes Ethereum vulnerable to a single point of failure. Now that JP Morgan owns a significant stake of this infrastructure, they basically own Ethereum.Mar 21, 2022

Buffett, who has been unsparing in his criticism of cryptocurrencies, made the fierce remarks against bitcoin on April 30, during the annual shareholders’ meeting of Berkshire. According to Buffett, he does not believe in investing in bitcoin as “it does not produce anything”.May 2, 2022

Story at a glance:

  •   Jamie Dimon, CEO and chairman of JPMorgan Chase, says Bitcoin is “worthless” but blockchain is cool.
    
  •   Dimon said being bullish for bitcoin is like believing in fool’s gold.
    
  •   JPM Chase has its own digital currency called JPM Coin that is similar to bitcoin but more exclusive when it comes to who can own it.
    

We need more “good” & “honest” people in government and banking.

How can we fix this?
Ferris? Anyone? Ferris? Anyone?? :sunglasses::joy:…but seriously; who from ATOM project or any project ,.is the right person to be leading an inevitable worldwide change in currency and all that follows? xx Colette

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Virtual Hive voted no for cosmos Proposal #82. We fully support Atom 2.0 and appreciate the improvements made on the Cosmoshub vision. However we believe that too much new features are introduced at once and believe further refinement and discussions here in the forum will help the adoption.

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For the few minutes the proposal is still live, we would like to take the time to also share our thoughts in Proposal #82: We believe some of the elements of the proposal make a lot of sense but some need to be clarified more in detail.

If we talk about the LSM for example, it makes sense from Cosmos’ perspective to have it but given the low-risk approach of the Hub in the past, we don’t feel this is aligned with that approach. This does not mean that we think the Hub should always take a low risk, low reward approach but given the fact that ICS is perhaps the most important development for the Hub narrative, LSM makes things complicated and introduces unnecessary risks to the Hub. What would have been ideal is for the Hub to directly host Liquid staking providers.
The next best thing is ICA but without clear incentive alignment between ICA controller and host zones it is a tricky one. Still the pros outweigh the cons because this is the best that can be done without all the other tech. That is why we lean towards YES.

For treasury, I think we have already seen projects mint additional tokens in the past to be able to support development. It does work, but for Cosmos, the politics itself is too tricky to manage. For this, more clarity on how exactly the funds would be managed and spent would make it a more convinced YES for us. The intent is obviously right, but due to the lack of clarity this part gets a NO and the fact that they will keep requesting for more funds in the future, which is not the best idea to split minting of new tokens in multiple tranches because it creates a bad narrative around token price. Plus, if ATOM has to gain more utility and value accrual, why issue new tokens?

For Scheduler and Allocator, it is again very tricky without knowing the details of how it will be built. The idea around an on-chain MEV relay market is good because it adds more transparency to the block space market. The argument against this is very simple: how do we know for sure that an on-chain MEV market is the right way to go? Not sure.

About the idea around having access to build and order transactions for a pre-agreed number of blocks, I think it makes sense for the Cosmos Hub to extract value from other chains, but other chains may not want Cosmos Hub to extract value from their chain. Commercially, this doesn’t seem the best model. We would prefer to see a mix of on-chain & off-chain MEV market.

So as conclusion, we do agree with some points and like some ideas in the paper, but we don’t agree with ‘ratifying the entire content of the paper’. In our opinion this proposal needs to be split up in separate actionable proposals.

We did however vote YES on this proposal to show our support and appreciation for the authors of the paper who try to make the Hub more valuable than what it is today. We think this can be seen as a signaling proposal that has woken up people and made sure everybody shared his or her vision on it, so this can be translated in a new (or several) updated proposals.

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I hope $ATOM can go as planned by the team

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