[Token Migration Proposal] $QSR Token Migration (Set inflation to 0)

Authors: Quasar

Summary

This proposal seeks approval for a strategic migration of the $QSR token aimed at increasing distribution to our expanded EVM user base, accessing bigger markets, higher liquidity and more trading venues, and better aligning with our future product expansion and development across multiple chains and ecosystems. We propose a plan to decommission the current $QSR token with a snapshot of existing holders, followed by the distribution of a new token via an airdrop or claim process. The delisting will be temporary, with an expected relist on EVM during Q1/Q2 2025. A snapshot of $QSR token holders will be conducted at block height 8,425,300.

Background

Quasar has experienced a period of great traction, with our original vision of yield aggregation products (Osmosis CL Vaults) growing Quasar to 10k+ users with minimal incentives. However it's clear the success of our protocol and its correlation with our token performance, has not continued.

Cosmos has provided us with a strong foundation to launch both our chain and $QSR token, yet it has become evident that the liquidity downturn and reduced opportunities for growth across the Cosmos ecosystem have impacted our ability to scale. For many tokens outside of the major ones (ATOM, OSMO, and AKASH) liquidity can be challenging and listing on larger trading venues can prove very difficult due to the complexities and overheads involved. This raises the question of ‘where will our future users and token holders be?’

Quasar's long term mission has always been interoperability and expansion across ecosystems. With our current focus on creating unified products, we believe ecosystems with MetaMask support, strong traction, user adoption and engagement will greatly help Quasar and our $QSR to thrive.

After careful consideration and our expansion to EVM last week, we have decided that also migrating our $QSR token to EVM is the best path forward. This migration period will include, at a minimum, halting all token vesting during the entire migration period (including the team and private investors) until it is completed. This also includes potentially further delaying vesting cliffs and unlocks until well after migration is completed. EVM provides access to a larger active user base and strong liquidity environment where we believe we will find the growth and traction to realize our long-term vision.

Motivation

The decision to migrate the $QSR token and subsequently relist it on an EVM chain is driven by several strategic factors crucial to the long-term success of Quasar:

• Unified Products : CL Vaults grow Quasar to 10k users with minimal incentives. However, we are now focused on expanding beyond Comos to EVM chains and creating products that unify many of the underlying yield primitives into Layered Staked Asset’s (LSA) and complex multi protocol vaults. Having $QSR positioned on the core ecosystem that our new products will launch will help to ensure maximum reach and distribution to our future users.
• Cosmos Liquidity Challenges : The current Cosmos ecosystem presents significant liquidity challenges, which have hindered the effectiveness and growth potential of the $QSR token. Cosmos still has many accessibility issues making it hard for its related tokens to reach new users. We aim to address these issues and reposition the token in a more favorable market environment.
• Trading Venues : Many of DeFi’s token liquidity and distribution avenues are unattainable for newer, sovereign Cosmos chains and their native tokens. These challenges don't exist for ERC-20 tokens, and so a migration to EVM opens up a vast suite of potential venues to achieve the required distribution to put $QSR into the hands of many more users and future depositors.

Quasar Chain, Security and $QSR Utility

The Quasar chain will continue in its role as the liquidity controller for all our future products across multiple ecosystems and being the minter of future LSA’s (Layered Staked Assets). It will continue to ensure the security and decentralized management of funds through our Strategy Keeper Network.

The $QSR migration provides an opportunity for Quasar Chain to strengthen its security and ecosystem alignment by introducing more flexibility and adaptability. Multiple security models are being considered including:

• Becoming an AVS of Eigenlayer, Symbiotic or other
• Utilizing shared security on an L2
• Utilizing Osmosis’ Mesh security
• Utilizing Bitcoin security through Babylon

The $QSR token will remain a crucial element of our product strategy. The utility of the new token will be clearly defined and communicated closer to its relisting on EVM. Our current focus in this phase is preparing the ecosystem and aligning governance and liquidity structures to ensure the relisted token’s utility is robust and meaningful.

Proposed Actions

To execute this effectively, we propose the following steps to ensure a smooth transition of the $QSR token through a controlled delisting, migration, and eventual relisting.

• Snapshot of Holders : The exact blockheight of the snapshot will be 8,425,300. The snapshot of all $QSR holders will be taken across Osmosis chain and its liquidity pools (IDs 1314 & 1060) and Quasar chain and the QSR/OSMO vault. Holders of $QSR at the time of the snapshot will be eligible for the new token distribution. Note that other smart contracts are not guaranteed to be included in the snapshot.
• Sale Penalty : The Quasar team reserves the right to penalize users for the sale of the existing $QSR token after the snapshot has been taken. This penalty also applies to private investors and team members. Withdrawal of POL Liquidity: Quasar will withdraw its Protocol-Owned Liquidity from the Osmosis pool and QSR/OSMO CL vaults, marking the end of our official support for legacy $QSR token until it is relisted.
• Halt Vesting : At a minimum, all token vesting (including the team and private investors) will be completely halted for the period of the token migration. The team reserves the right to create a delayed and renewed vesting schedule for itself and private investors.
• Inflation Set to 0% : The inflation parameter for $QSR will be set to 0%, halting the minting of new tokens. This is a temporary measure. Post-migration, this will be revisited and adjusted to support better efficiency and alignment for long-term security.
• Halt of Delegation Program : The Delegation program will be halted for the foreseeable future and it will be revisited once we have higher clarity on the future of our L1 chain.
• Token Migration : After the migration period the new $QSR token will be relisted and distributed to eligible holders on EVM through either an airdrop or a claim process on app.quasar.fi.

Takeaway

We believe the $QSR token migration to EVM will position Quasar for growth and expansion. It provides $QSR with the ability to leverage more expansive markets and get immediate access to greater liquidity, increased user base, more Trading venues and better token distribution. Positioning $QSR at the center of our future ecosystem is vital in facilitating the development of our new unifying LSA products and maximizing their reach to our future users.

Voting

• By voting YES, you agree to set inflation rate to 0.
• By voting NO, you disagree to set inflation rate to 0.
• By voting ABSTAIN, you express no opinion on the matter.
• A NoWithVeto vote indicates a proposal either (1) is deemed to be spam, i.e., irrelevant to Quasar, (2) disproportionately infringes on minority interests, or (3) violates or encourages violation of the rules of engagement as currently set out by Quasar governance.