Is there an associated proposal by Interlay for this discussion?

This is a really good idea and a good target for treasury funds. It will add enormous value to the network to link with the most valuable project in crypto.

@danielk agree, but I dont think the value added to the ecosystem is what is in question here - but the process of deployment and coordination between networks, as well as how Council decisions affect an efficient use of resources.

The proposal is not published yet, but once it is I will make sure to share the link here.

"I feels somewhat rushed to launch on Kusama first. Why not simply wait for a common good slot and subsidies on Polkadot”

Why is launching this on Kusama "rushed" but launching Statemint or any other parachain not rushed? I would think that BTC liquidity was pretty crucial for both chains.

agree i would worry about regulatory attention from SEC if polka controls ksm

@wgolsen bridging Bitcoin to the Polkadot ecosystem is an important goal, for sure - that is not in question. I believe the particular comment you pointed out refers to the level of uncertainty it would bring if we rely on:

1. Deploying on Kusama
2. Migrating after from Kusama to Polkadot to accomplish the goal.

How this would work is not yet clear, technically speaking - we would need to see what the tech stack allows once it is deployed and how the team aims to execute the migration: hence the use of "rushed" part.

My understanding is there is no migration planned for a chain like Statemint or any other network aiming to become a parachain, unlike the proposal Interlay presented this week: so I am not sure if the comparison makes sense.

My understanding is that Interlay's initial proposal did not involve a migration, just the usual independent parachains on each network (like Statemint/Statemine and Acala/Karura), and that the modified proposal used migration as a compromise due to the council's misgivings about having two networks. Is that a correct assessment?

Correct. What some councillors pointed out is how using multiple limited resources (in this case, common-good slots) for only one project could result in an inefficient use of these resources - migration is a good alternative, but there are still some open questions regarding how this would work.

Then I think this points out an unexpected coupling between the projects' councils. The common good slots for both projects are being treated as a single resource pool, but the tokens are traded separately and bought on exchanges by investors who are unaware of this coupling. Even the compromise solution of migration is a bit alarming, as it soft-schedules an eventual but unpredictable removal of liquidity from Kusama to benefit a separate chain. Kusama was billed as an independent canary network, not a dependent testnet. I realize that these projects have a rather unique common origin and that many of the decisions involved in piloting sibling projects have few precedents in crypto, but they're not without precedent in traditional business and investing.

@kahnung Yes, it does seem potentially dangerous, from a regulatory perspective. Blended councils make it effectively impossible to be transparent in making and explaining coupled decisions.

I'm thinking specifically about the Ripple lawsuit.

is usdt still launching first on kusama or has the polka council now reserved it only for polka?

Here is the thing. At some point we have to accept that KSM MC could be worth more than DOT MC if both networks are allowed to develop organically. Having first mover advantage may be more valuable than having higher reliability at least for the next couple years. My concern with a mixed interest Kusama council, that is a council that holds both DOT and KSM, is that Kusama is intentionally sandbagged for the sake of DOT. What's best for the whole ecosystem is both networks try to maximize utility and value.

I am all in on KSM and don't own any DOT, because I think KSM is way undervalued relative to DOT. DOT has the same name as the ecosystem/project as a whole, "polkadot". As valuation starts to depend more on utility and less on future speculation I think KSM will converge with DOT in MC.

The Kusama council should put the original Interlay proposal up for community referendum before moving on to the more vaguely defined compromise proposal involving "migration" and unavoidable delays of indeterminate length. Since the original proposal was voted down in an anonymous, closed-door signal vote, there is no way for the community to know who voted against the original proposal, or (unless they're paying very close attention) that there even was an original proposal.

According to the Interlay slides, there were 11 nays to 4 ayes in the signal vote on the proposal to launch on Kusama as a normal non-migrating parachain. I would like to know which councillors voted against this, so that this knowledge can inform my vote in elections. Without this kind of transparency, the governance system doesn't really work; the community might only ever see dysfunctional compromise proposals, filtered through unknowable layers of potentially conflicting economic interests.

Hi @wgolsen answering here to your concerns regarding the process for these type of proposals.

As you might know, this process is quite new and has not been done before, so our first ground for experimentation is Kusama. In general, councillors' signals are considered part of the feedback for treasury proposals in order for teams to adapt their proposals before submission, and allowing them to minimize the risk of rejection and therefore slash. We do this with the majority of treasury proposals in order to maintain the funnel active and avoid proposers losing their funds in the possible event of a slash if the submission is rejected.

We tried really hard to follow a process we think is as simple as possible given the topics being discussed on this particular package by Interlay (including not only allocation from the treasury, but common good slot and governance design). The signalling process before public discussion allows us to harmonise council’s expectations with the proposal submission - and is part of the strategy of the governing bodies to be able to think long-term. Interlay requested this signalling process to know where the proposal stood before discussion, and I believe Interlay has the council seats that voted Nay, I mentioned them on a call. Maybe they can share them here or provide them to you, in order to inform your vote in elections.



If you follow the governance design of the networks, you will for sure know that for a common good slot to be allocated to a particular team, the proposal needs to ultimately be voted in referenda queue (root origin) - the Council’s intervention in this respect using "Adaptive Quorum Biasing" only works as a lever that the body can use to alter the effective super-majority required to make it easier for a proposal to pass. But the Council does not have the final decision on the common good slot allocation, the community does. 



Regarding the possibility of 2 common good slots to Interlay: the majority of the Kusama Council, as I mentioned before, believes that given the characteristics of this project it is detrimental for both networks to have virtually the same token and two liquidity pools competing against each other, and that this should be taken into account if the Polkadot Council has signalled to give a common good slot to PolkaBTC. This reasoning is reinforced if we think of common good slots as a limited resource, at least at the beginning of parachains deployment. Projects like Karura/Acala (mentioned in your other post) won’t be applying for common good slots but will be participating in auctions: something the Councils cannot intervene on. Projects like Statemint, if I understand correctly, represent a different kind of parachain that cannot be really compared to the PolkaBTC bridge, given that 1. there is no competing liquidity pools, 2. the applications on the parachain on each network will be different and 3. any minted assets in one chain won’t be the same as its sister chain on the other network (different from a wrapped BTC unit on Kusama or on Polkadot). However, Statemint goes through the same process of Council discussing this and the community voting after.

Polkadot and Kusama are two independent networks in the same ecosystem, and given we think of them in the future as bridged, it is important that some level of coordination between them exists when it comes to common-good slots allocation. I can assure you the Council does see a BTC bridge as highly strategic for Kusama, and remember many teams (not only Interlay) are working towards this goal.

Thanks for your reply, @RTTI-5220.

In my opinion, it's a fallacy to treat the two networks as fundamentally and inseparably entangled. This implies that the tokens have an innate (and legal) ability to communicate and coordinate with each other in "non-classical" ways-- that is, by a blended council which treats the two as a single entity with shared resources and shared treasuries. But this is not how the systems were designed and deployed, or how markets work. Distinct exchange-traded tokens are classical creatures. DOT and KSM tokens are completely distinct from the market's perspective; nowhere in code or architecture or market dynamics are they defined to be coupled. The technical, political and economic views of the system must match or else there will be friction and, inevitably, schism. So the two networks' ability to coordinate with each other must necessarily be effected classically: via bridges and transactions and cross-chain messaging... not via unobservable council collaboration. Unobservable collaboration-- innocent and aspirational though it may be-- is still technically collusion from a market perspective. A Kusama council vote which reserves an opportunity for Polkadot, however justified by concerns about a shared ecosystem, would negatively affect the exchange price of Kusama's token.

Arguments referencing token prices are often dismissed out-of-hand as ugly "bag talk," but token value is an integral aspect of the functioning of the relay chains and was carefully baked into the design of the system's tokenomics. The politically symbiotic dynamic you describe codifies the acceptance of a Might Makes Right policy, with the weaker of the two networks always at the mercy of the stronger. The Kusama community can be forced to accept a period of fiscal austerity, waiting through an indeterminate delay for parachains to launch on Polkadot, in order to benefit the shared ecosystem in unquantifiable ways. This is a unidirectional pain channel. Does the Kusama council have the ability to inflict this kind of pain on the Polkadot community? If not, why not? Because its market capitalization is lower? Would the power balance flip if Kusama's market cap exceeded Polkadot's? Does Polkadot have a very strong incentive to prevent Kusama's market cap from rivalling its own?

The answer to that last question might, even in a just system, be yes-- in which case Kusama has the same incentive to leapfrog Polkadot and, once ahead, to remain ahead. That's the free market. And that, in my opinion, is the only way this ecosystem can function in the long-term. Polkadot should compete by competing, not by enforcing its will on Kusama through legislation. If the network distinctions in the initial design-- slow-but-safe-and-stable versus fast-but-risky-- aren't seen as conferring sufficient advantage to Polkadot, Polkadot could (for example) further differentiate itself through investment in exclusive internal projects, or even through competitive offers to external projects in order to secure exclusivity. In other words, Polkadot should have to pay for its advantages-- out of its own treasury and not out of both, or out of Kusama's preferentially (which is what happens when the advantage is legislated into existence by denying Kusama an opportunity, or by making it wait for it).

Ultimately, my concern has nothing to do with Interlay's proposal directly. It concerns the process by which the relationship between Polkadot and Kusama is being defined. I suspect that symbiosis cannot be imposed, top-down, on a technical/political/economic ecosystem any more than it can be on a biological, and that an attempt to do so will result in crippling pathologies in both systems, increasing their vulnerability to external attack, and creating justified regulatory anxiety for any project or investor who touches either.

Even the compromise solution of migration is a bit alarming, as it soft-schedules an eventual but unpredictable removal of liquidity from Kusama to benefit a separate chain.

It does? We should really try to get the PolkaBTC / InterBTC token to Kusama, even if the Bitcoin bridge chain is on Polkadot only. This of course depends on the capabilities of the DOT-KSM bridge.

For the Ethereum bridge, this will be even more important. There are many tokens that we'd want to have on Kusama, and the ability to interact with smart contracts will also be essential. With the Bitcoin bridge, there is one token and it will be easy to have logic to have it wrapped further on Kusama. And so Kusama not having its own Ethereum bridge is a lot more technically difficult to make equivalent in functionality to having our own compared with Bitcoin.

We should really try to get the PolkaBTC / InterBTC token to Kusama, even if the Bitcoin bridge chain is on Polkadot only. This of course depends on the capabilities of the DOT-KSM bridge.

My understanding is this will happen with the DOT-KSM bridge, indeed - I will ask the team working on this to leave their comments here. And I agree that with the Ethereum Bridge this is even more relevant: since the bridge will enable smart contracts functionality and we need to guarantee this on Kusama.

Will Kusama get an Ethereum Bridge (Snowfork) at its own launch, or only later, when parachains launch on Polkadot?

@wgolsen thats for governance to decide. And I would expect Councils to assess the specific elements of the bridge to decide on this.