V.I Guidance
It is anticipated that as the M^0 ecosystem grows, an increasing number of stakeholders will have an interest in its continued development and improvement. These stakeholders are referred to as Think Tanks. Much as the Basel Committee and its cooperating international regulators have provided (theoretically non-committal) guidance and rules for the banking sector, it is anticipated that similar groups and perhaps new M^0-specific institutions will provide guidance for the M^0 ecosystem and protocol. The protocol is designed in such a way that it can formally adopt guidance through a governance vote and enforce this guidance throughout the system via the Validators. It is intended to function as follows:
Step 1
Think Tanks provide guidance.
Step 2
The TTG adopts or rejects this guidance by voting on a hash of the public document containing it.
Step 3
Permissioned Actors adjust their behavior accordingly.
Step 4
Validators withhold signatures, Cancel Propose IDs, or Freeze Minters who have not adjusted their behavior to be in line with the guidance. If there is still non-compliance, the TTG can remove errant actors from the system.
This combination of steps creates the “guidance feedback loop.”
Example
Think Tanks interested in the progress of the M^0 ecosystem and protocol determine that only certain jurisdictions are appropriate to host Eligible Custody Solutions. These Think Tanks put out guidance amending the definition of an Eligible Custody Solution to include a list of appropriate jurisdictions, and stipulate that all Minters should be in compliance with this list within 180 days of the proposal’s execution. The document is hashed so that all actors can validate they have the same and correct version of the guidance, and this hash is submitted to the TTG under a guidance list. The POWER holders will then vote on the proposal. If it passes, the guidance should be considered approved and enforceable. Once the 180 day window is complete (which is also defined in the guidance), Validators should begin to withhold signatures on Update Collateral calls from Minters that attempt to include Eligible Collateral held in an unapproved jurisdiction in their on-chain collateral value. Validators can also call Cancel or Freeze on a Minter that is errant in other ways not capturable in the Update Collateral method. Validators not enforcing the approved guidance should expect to be removed by the TTG.
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