t3ier.base.eth
@t3ier.eth
⚛️ Cosmos Hub: LSM removal and replacement Recently, many articles have been published about the Liquid Staking Module (LSM) implemented on the Cosmos Hub in August 2023 with the Gaia v12 update. ❓But what is the LSM?
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t3ier.base.eth
@t3ier.eth
1️⃣ This module brings several improvements: » Limiting the total amount of ATOM that can be liquid staked to 25% of all staked ATOM » Validators need to stake a certain amount of their own ATOM » Staked ATOM can be instantly liquid staked, without having to wait for 21 days
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t3ier.base.eth
@t3ier.eth
2⃣ However, several issues have been raised recently: » Nationality of the developers: a significant portion of the LSM code was written by developers with ties to North Korea. However, the vast majority of the code has been rewritten since then.
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t3ier.base.eth
@t3ier.eth
» Lack of transparency: Zaki Manian, one of the project's leaders, was reportedly informed of this involvement as early as March 2023 but did not share this information with the Cosmos community » Technical complexity: The implementation of the LSM required forking the Cosmos SDK
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t3ier.base.eth
@t3ier.eth
3⃣ To address these issues, the Informal Team has just published a draft proposal on the Cosmos Hub forum to replace the existing module. This replacement could take place in several stages ⬇️
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t3ier.base.eth
@t3ier.eth
» A 1 to 2-month grace period to let users un-tokenize their LSM shares » Update of the Cosmos Hub to remove the LSM + un-tokenize remaining tokenized delegations » Implement a new framework similar to what EigenLayer offers
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