FatMan

Our on-chain deductions suggesting Mirror governance is manipulated by TFL and Jump behind the scenes allow us to reframe some past events with the benefit of more context. Let's begin with a cautionary tale about the dangers of not paying attention that cost users $3m. (1/10)

Delta-neutral strategies are not as safe as they seem, and they require active management. A proposal to instantly (ie. sans laddering) raise mKO (Mirror's Coca-Cola stock) collateral requirements from 110% to 130% was voted in via Mirror governance on the 14th of April. (2/10)

This means that 3k wallets with $3m in mKO shorts would get instantly liquidated by bots as they fell within the unfortunate collateral requirement range between 110% and 130%. This did indeed happen, and a few people lost their savings due to bad advice from influencers. (3/10)

Even though there was no warning on the Mirror front-end (hmm...), there was an eight day period where users could track the governance vote - people with DN positions should have checked this daily. It was their fault - SFYL and DYODD next time. That's our tale. (4/10)

But that fateful night, a far better proposal sat abandoned in the distance: @MasterGerund of the Mirror steering committee (non-TFL) had proposed a plan where the CR would be raised slowly, 1% at a time, allowing people room to add margin and be warned via the front-end. (5/10)

An anonymous whale with massive sway over MIR pushed through the suboptimal proposal that would allow liquidation bots to make a quick $3m as opposed to the saner proposal that would protect users & positions in a fair manner with fair warnings via visible margin updates. (6/10)