osmosis

Prop 922: Unwind MNTA/OSMO Liquidity Pair and Return Assets to MantaDAO

This proposal seeks to unwind the MNTA/OSMO liquidity position established through Proposal 639, return the MNTA tokens held in the Osmosis Community Pool and Supercharged pool LP position to the MantaDAO multisig, and receive all OSMO deployed to Kujira by Manta DAO in return.

This aligns with both MantaDAO's sovereign chain migration strategy and Osmosis' broader move away from OSMO pairings with smaller, non-correlated assets as outlined in Proposal 891.

Motivation

In 2023, the Osmosis and Manta DAO communities collaborated on a $50k OSMO <> $50k MNTA token swap (Proposal 639) aimed at deepening cross-ecosystem liquidity and cooperation. Each side deployed matched liquidity to their respective DEXs — Osmosis and Kujira’s FIN — creating protocol-owned liquidity (POL) in both ecosystems.

Since then, Manta DAO has initiated a strategic migration to Rujira, and recently passed Proposal 51, which mandates unwinding all active token swap deals, including MNTA/OSMO, to repatriate assets and simplify token management pre-launch.

Concurrently, Osmosis has adopted a new treasury strategy centered around OSMO decoupling (Proposal 891), which calls for the dissolution of liquidity pairings between OSMO and lower-cap, non-correlated assets. These are being phased out in favor of stablecoins and high-cap assets with deeper and more efficient trading routes.

Assets

  • Assets currently held by MantaDAO <> Osmosis Treasury Swap Custody Multisig
    • ~300,000 MNTA and ~40,000 OSMO in the MNTA/OSMO Supercharged pool
  • Assets currently held by MantaDAO Ops
    • ~212k MNTA and 68k OSMO in the MNTA/OSMO BOW pool
    • ~26k OSMO in a stOSMO/OSMO pool
  • Assets Currently Held by Osmosis:
    • ~37,000 MNTA in the Community Pool (unused excess from original deployment)

Execution

  1. This proposal transfers the ~37,000 MNTA from the Community Pool to the MantaDAO <> Osmosis Treasury Swap Custody Multisig.
  2. Approval is granted to withdraw the MNTA/OSMO Supercharged pool on Osmosis This will be performed at approximately the same time as the withdrawal from the OSMO/MNTA pool on Kujira.
  3. The stOSMO/OSMO pool liquidity will also be withdrawn on Kujira to compensate for the ratio discrepancy caused by the concentrated position on Osmosis not maintaining a 50/50 ratio.
  4. Send all OSMO and stOSMO (~94k OSMO equivalent) from the Manta Ops subDAO to the MantaDAO <> Osmosis Treasury Swap Custody Multisig.
  5. Send all MNTA from the MantaDAO <> Osmosis Treasury Swap Custody Multisig to the Manta Ops subDAO.
  6. Return all OSMO (134k) to the Osmosis Community Pool and MNTA (549k) to the Manta DAO.

Debrief

This liquidity deployment initially deployed 312,290 OSMO and, if both MNTA/OSMO pools were to be dissolved, would only receiving ~108k back. The pool has historically generated around $3500 in taker fees resulting in a net loss.

Some of this loss could be recouped through the sale of excess MNTA above the 1:1 value ratio, however this would incur high slippage.

Manta Ops have agreed to liquidate their stOSMO/OSMO holdings to bring the ratio of assets closer without resulting in high slippage.

This should result in the recovery of approximately 134k OSMO from the original 312k deployment.

Forum Post: https://forum.osmosis.zone/t/unwind-mnta-osmo-liquidity-pair-and-return-assets-to-mantadao/3579