Summary:
We propose to wind down the AMKT Security Council in connection with the recently approved wind-down of AMKT.
In AMKT-IP-6, AMKT holders voted to add a three person security council to the AMKT governance process to help ensure that no single group of actors could unilaterally upgrade the AMKT smart contracts. The existence of a Security Council also helped to ensure that there would be readily available technical support in the event of a security concern.
Since that time, AMKT has struggled to maintain its tracking to NAV, as redeeming out of each of the components is too costly on mainnet and liquidity for many of the underlying components is reduced or non-existent. For that reason, in AMKT-IP-11, AMKT holders approved rebalancing and reconstituting the AMKT index into just two assets, WBTC and wstETH, from the previously-supported 15 assets in order to manage an orderly wind-down of AMKT.
Now that the rebalancing and reconstitution has been completed, AMKT is composed of two highly liquid assets. Given the simplified portfolio of underlying assets and the reduced support for AMKT going forward, the need for the AMKT Security Council is correspondingly reduced.
With this proposal, the Security Council would be eliminated and its power (the ability to propose upgrades to AMKT on the same level as AMKT token-holders) would be revoked. Going forward, AMKT holders can still propose, and the AMKT multi-sig can implement or veto changes to the AMKT smart contracts.
Motivation:
The purpose of the Security Council was to help ensure that the AMKT multi-sig is not able to unilaterally upgrade the AMKT smart contracts and to provide a group of security engineers to oversee security concerns relevant to the AMKT DAO. With the simplification and eventual wind-down of AMKT, we believe that the risks the Security Council was designed to mitigate, and the corresponding functionality provided by the Security Council, are sufficiently reduced so that the Security Council can reasonably be eliminated.
Risk Factors:
The absence of a Security Council means that only the AMKT DAO will be able to propose changes. We believe this risk is mitigated by the fact that the AMKT token is now considerably less complex than in its previous (pre-wind down) form; for that reason, changes to AMKT should therefore be less necessary, and can still be proposed by the AMKT DAO.
The absence of a Security Council means that there is not a team of people who provide technical support in the event of a security concern. We believe this risk is mitigated by the fact that (1) the AMKT token is now considerably less complex that in its previous (pre-wind down) form, and the security risks are therefore correspondingly lower; and (2) other members of the AMKT community possess sufficient technical knowledge to provide technical support to the AMKT DAO on an informal basis in the event of a security issue.
Conclusion:
We recommend AMKT holders vote FOR our proposal to wind down the Security Council.