[NGV-01] Adopt a Balancer AutoRange Pool as Neverland’s Core DUST/USDC Liquidity Venue

Governance Governance Vote
1

[NGV-01] Adopt a Balancer AutoRange Pool as Neverland’s Core DUST/USDC Liquidity Venue


Vote

[NGV-01] Adopt a Balancer AutoRange Pool as Neverland’s Core DUST/USDC Liquidity Venue

Summary

This proposal seeks governance approval to migrate Neverland’s incentivised USDC/DUST liquidity from the existing Uniswap V2 pool to a newly deployed Balancer V3 AutoRange pool on Monad. The migration is designed to convert today’s headline V2 liquidity (much of which sits at prices far from where DUST actually trades) into concentrated liquidity that is meaningfully active at the spot price, without exposing LPs to the active range-management burden that has undermined previous concentrated liquidity attempts.

The expected outcome is materially lower slippage on routine trades, deeper effective depth where DUST actually trades, more productive LP incentives and fees per dollar spent, and a more resilient DUST price chart through the recurring epoch sell pressure cycle.

If this vote passes, the migration will begin on June 4, 2026 at epoch reset. nUSDC LP incentives, currently distributed via Merkl on V2 LP positions, will be redirected to holders of the AutoRange pool’s BPT. For the first week post-migration, LP rewards will be split 80% to the Balancer AutoRange pool and 20% to the Uniswap V2 pool to allow for a smooth transition. After the first week, the team will have the discretion to direct 100% of LP rewards to the Balancer pool. The initial pool parameters, suggested by the Balancer team, are a price ratio of 4.0, a centeredness margin of 5%, and a daily price shift exponent of 2%.

Background

Neverland currently incentivises liquidity in a Uniswap V2 USDC/DUST pool that holds approximately $797k worth of DUST and USDC. Because V2 spreads capital uniformly along the entire constant-product price curve, the effective depth at the spot price is a small fraction of the headline TVL. The recurring 7-day epoch veDUST unlock cadence (which produces a meaningful concentration of sell pressure in the roughly ±1 day window around each epoch end) interacts poorly with that thin effective depth, translating routine flow into outsized downward price moves and creating an attractive setup for predatory positioning ahead of each epoch end.

Prior attempts to address this via plain Uniswap V3 concentrated pools failed because DUST’s volatility caused LPs to converge on ultra-narrow ranges and rebalance constantly, producing rebalancing cascades that pushed passive LPs out of range and concentrated incentive capture among a small group of active managers, rather than building the durable, broadly-held depth that Neverland actually needs.

The Balancer V3 AutoRange pool resolves both sides of this problem. It delivers the capital efficiency of concentrated liquidity while encoding range management as a deterministic on-chain mechanism. All LPs share a single range and hold a single fungible BPT, the pool itself handles range adjustment automatically, and there is no manual range to set, no manual rebalancing, and no game to win against other LPs.

This Governance Proposal is the direct successor to RFC-01, which was opened for community feedback prior to this vote. Adjustments incorporated from the RFC process are reflected in the Proposal section below: notably, the introduction of a transitional 80/20 reward split for the first week post-migration, the clarification of the protocol-owned liquidity (POL) build-up plan, and the explicit specification of operational security and admin policy for the AutoRange pool.

Request for comments: [RFC-01] Adopt a Balancer AutoRange Pool as Neverland’s Core USDC/DUST Liquidity Venue

Proposal

This proposal authorises Neverland to migrate its incentivised USDC/DUST liquidity from the existing Uniswap V2 pool to a newly deployed Balancer V3 AutoRange pool on Monad, with the following finalised specification.

Initial Pool Parameters

  • Price ratio: 4.0

  • Centeredness margin: 5%

  • Daily price shift exponent: 2%

These parameters prioritise pool stability over rapid range adaptation, which is the appropriate posture for a pool that must absorb a recurring, mean-reverting epoch flow cycle every 7 days. The 4x range gives the pool meaningful headroom to absorb normal price movement without needing to chase it. The price range bounds are fixed at deployment. The centeredness margin and the price shift exponent remain admin-mutable post-deployment and can be tuned in the future as real behaviour is observed.

Migration Timing and Reward Transition Schedule

  • The migration will begin on June 4, 2026 at epoch reset, conditional on this vote passing.

  • The nUSDC incentive program continues with the same Merkl distribution infrastructure.

  • For the first week post-migration, LP rewards will be split 80% to the Balancer AutoRange pool and 20% to the Uniswap V2 pool, to allow LPs and routers to transition smoothly.

  • After the first week, the team will have discretion to direct 100% of LP rewards to the Balancer AutoRange pool, based on observed transition progress.

  • The V2 Merkl campaign will be wound down accordingly as part of this transition.

Protocol-Owned Liquidity (POL)

  • Neverland’s existing protocol-owned liquidity, currently held in a Uniswap V3 position, will be withdrawn and redeployed as a passive Uniswap V2 backstop position alongside the new AutoRange venue, in the same coordinated migration action.

  • Beyond that initial redeployment, the V2 POL position will be built up over time using weekly revenue allocation, at the discretion of the team. This ongoing build-up is intended to deepen the V2 backstop and reinforce its role as a non-Balancer fallback that ensures DUST remains routable through V2-only paths.

Post-Migration Liquidity Structure

  • The Balancer AutoRange pool becomes the core incentivised liquidity venue. Aggregator routing should naturally prefer it on size because of the concentrated depth advantage.

  • The Uniswap V2 pool remains live as a non-incentivised passive backstop, providing redundancy in the unlikely event of an issue with the AutoRange venue.

Admin Rights and Parameter Governance

  • Admin control of the AutoRange pool lay with Balancer. Any adjustment to admin-mutable parameters (centeredness margin, daily price shift exponent, price ratio) will be done in coordination with the Balancer team and guided by data.

  • Parameter updates go through the Maxyz omni-safe, which is a 1/2 multisig. The two signers on that safe are themselves multisigs:

    • A 3/5 safe operated by the Maxyz operator.

    • A 3/4 safe held by foundation legal signers.

  • In practice, this means an attacker would need to compromise at least 3 private keys across separate parties to push any change. On the Maxyz side, all signers use hardware wallets, and several signers additionally sign from dedicated laptops isolated from day-to-day use. The threshold and operational security are designed specifically to prevent a single compromised key from harming LPs.

  • Price ratio updates are driven by pool performance and only adjusted when simulations show a clear benefit to LPs and the trading experience, so they are neither routine nor arbitrary. The Balancer team runs ongoing simulations to optimise these parameters, and any change is discussed with Neverland’s core team before being applied.

  • Important: this admin lever tunes pool behaviour and cannot move LP funds in any way. Even paused pools always allow withdrawals.

Security Posture of the Balancer Venue

  • Balancer V3 has been audited by multiple top-tier firms and designed with a focus on security. The specific AutoRange (ReCLAMM) pool type has been subject to independent reviews by Cantina, AgentArena, and Certora (linked in the References section), with no critical, high, or medium severity findings reported across the available reports. All low-severity findings identified by Cantina were fixed by Balancer.

  • The pool is monitored 24/7 by Hypernative, which has an automated pause module integrated with Balancer. Pools are paused immediately in case of anomalous activity.

Risk Considerations

Pool maturity

The AutoRange pool is a relatively new pool type. Although well audited and in production use across Balancer V3 deployments, it has less production track record than V2-style or static concentrated designs. The conservative parameter selection and the parallel V2 backstop are the mitigations for this.

Slow catch-up under sustained directional moves

A sustained directional price move in DUST would draw the pool out of range and trigger gradual repricing. At a 2% shift exponent, the pool’s catch-up is intentionally slow; good for stability, but during a strong sustained trend the pool may continue quoting prices that lag the market-clearing level for an extended period. The relevant mitigations are the built-in gradual shift mechanism, the parallel V2 backstop (which will exhibit different price dynamics under the same flow and create some arbitrage rebalancing), organic buy-side flow entering at depressed prices, and the ability to tune the shift exponent or centeredness margin in genuinely extraordinary conditions.

MEV implications of admin-mutable parameters

The admin-mutable controls (centeredness margin, daily price shift exponent, price ratio) carry MEV implications when used, particularly the price ratio update. Routine use of these controls is not anticipated. The operational policy described in the Proposal (Balancer-led simulation, prior discussion with Neverland’s core team, and the multisig structure) is designed to keep usage rare, deliberate, and data-driven. As noted, these levers tune pool behaviour only; they cannot move LP funds, and paused pools always allow withdrawals.

Operational security

The 1/2 Maxyz omni-safe, with 3/5 (Maxyz operator) and 3/4 (foundation legal signers) underlying multisigs, means at least 3 private keys across separate parties must be compromised to push any change. Hardware wallet enforcement and isolated signing environments further reduce the practical attack surface. Hypernative’s 24/7 monitoring with an integrated automated pause module provides a continuous reactive layer on top of this preventative structure.

Transition friction

The 80/20 first-week reward split is designed to smooth the LP transition rather than force a hard cutover. There is some residual risk that the 20% V2 share retains stickier LPs than expected, or that the routing transition takes longer than a week. The plan retains team discretion to manage the post-first-week reward direction accordingly.

Governance Approval

A successful vote authorises the following:

  • Migration of the nUSDC LP incentive program starting June 4, 2026 at epoch reset.

  • A transitional 80% Balancer / 20% Uniswap V2 LP reward split for the first week post-migration.

  • Discretion for the team to redirect 100% of LP rewards to the Balancer AutoRange pool after the first week.

  • Withdrawal of Neverland’s existing Uniswap V3 protocol-owned liquidity and its redeployment as a passive Uniswap V2 backstop position, with subsequent build-up of that V2 POL position via weekly revenue allocation, at the team’s discretion.

  • Acknowledgement of the admin-rights structure: admin held by Balancer, with parameter changes coordinated with the Balancer team and routed through the Maxyz omni-safe and its underlying 3/5 and 3/4 multisig signers.

The exact incentive budget remains out of scope of this vote and will be adjusted at the team’s discretion once the pool is live and baseline TVL response can be observed.

Voting Options

Choose the voting options this Governance Vote should include:

  • Option 1: Approve the migration as specified.

  • Option 2: Reject the migration as specified.

  • Abstain

[NGV-01] Adopt a Balancer AutoRange Pool as Neverland’s Core DUST/USDC Liquidity Venue

Execution Considerations

T-0, June 4, epoch reset (conditional on a passing vote): The Merkl campaign on the V2 pool is reweighted, and a new Merkl campaign on the AutoRange BPT begins. The LP reward split for the first week is set to 80% Balancer / 20% Uniswap V2.

Same window: Neverland’s existing Uniswap V3 protocol-owned liquidity is withdrawn and redeployed into the Uniswap V2 backstop position.

T+7 days: First-week transition window ends. The team may, at its discretion, redirect 100% of LP rewards to the Balancer AutoRange pool. If observed LP behaviour or routing dynamics warrant continuation of a split, the team may adjust the timing accordingly and report back.

Ongoing: The V2 POL position is built up over time using weekly revenue allocation, at the discretion of the team.

Ongoing: Admin-mutable parameter changes, where appropriate, are coordinated between the Balancer team and Neverland’s core team and routed through the Maxyz omni-safe (1/2) and its underlying 3/5 (Maxyz operator) and 3/4 (foundation legal signers) multisig signers. Hypernative’s 24/7 monitoring and the integrated automated pause module remain active continuously.

Closing Statement

The choice before governance is whether Neverland continues to pay for liquidity that mostly sits idle, or redirects the same incentive budget toward depth that is actually useful for execution. The RFC process has surfaced and resolved the operational questions that informed this specification: a defined migration start, a transitional reward schedule, a preserved and progressively reinforced V2 backstop, multisig-gated admin governance, and a continuously monitored security perimeter.

A vote in favour authorises the team to execute that specification at the June 4 epoch reset. A vote against preserves the current V2-only incentive structure, along with the recurring epoch-end inefficiency that motivated this proposal in the first place.

Governance participants should weigh the structural gains against the residual risks documented above before casting their vote.


References

4 Likes
[RFC-01] Adopt a Balancer AutoRange Pool as Neverland’s Core USDC/DUST Liquidity Venue
2

Seems a structural upgrade for Neverland. Trusting team.

1 Like