As previously discussed in this thread, we would like to allow the trading of Pre-IPO assets on the Mirror Protocol. Given the previous complexity of the original process, we propose a slightly modified version of the pre-IPO contracts.
|Traditional IPO||Mirror IPO|
|Estimated Price Range Published||Mint at published price within minting period|
|SEC mandated quiet period (25 days)||mPre-IPO Trading/LP|
|IPO||mPre-IPO becomes mPost-IPO with new price feeds|
We have essentially removed the ‘auctioning process’ that was originally proposed.
The user flow is explicitly,
- When the SEC published price range is out, a user can submit a governance proposal with the requisite pre-IPO and post-IPO parameters to be voted on (whitelisting process).
- Once the proposal passes, users are allowed to mint at the given price for a fixed period of time (minting period is decided by governance).
- Trading (in the same manner as the current AMM DEX) & pool/staking are all available.
- Once the IPO happens, the first trading price of the pre-specified oracle terra address will be used, and all parameters become the voted post-IPO parameters (migration from mPre-IPO → mPost-IPO).
- All minting related operations follow the current process with the new parameters post-IPO.
- During the minting period, a fixed price (the governance-voted mint price) is voted. Once this mint period is over, price voting stops. This effectively means mint positions are not only non-openable, they are also non-closable during this time period.
Below are some questions that I would like to ask the community:
- It is also possible to entirely remove the fixed price & minting period by instead taking the price feed for pre-IPO assets from an exchange such as FTX. Advantages include probably lower collateral ratios, removal of the minting period, and perhaps even closer UI/X to the current minting process. Disadvantages include the fact that the FTX contracts are backed by a risk counterparty (a firm) and potentially unreliable price feeds. Which would you guys prefer?
- IPOs can be cancelled by the firm/underwriter. In the case of a cancellation, how should already minted pre-IPO assets and positions be handled. An option is to use the current migration feature to allow users to burn/sell their mPre-IPO asset at the voted fixed mint price. A second option is to completely share the burden and responsibility to those who hold the mPre-IPO positions (‘trade at your own risk’). I am curious about your thoughts on these two options or suggestions for different solutions.
For your reference: