Origin Protocol (OGN)

Project with multiple products, among which a stablecoin OUSD and an NFT launchpad.

Basics

• Based in: USA
• Started in / Announced on: 2017
• Testnet release:
• The Origin Beta is live on the Ethereum Mainnet (4-2019)

History

• From a blog by Pantera, an investor in Origin (19-1-2023):

"Origin Protocol was founded by Joshua Fraser and Matthew Liu in 2017. Josh previously founded Torbit, a web performance and management service acquired by Walmart Labs, and EventVue, a conference social networking software. Matthew previously founded PriceSlash, a consumer price-saving tool acquired by BillShark, and Unicycle Labs, the creator of ecommerce apps on Shopify."

Audits & Exploits

• No bug bounty according to Blockchain Security DB (29-6-2020), which does show 1 audit (11-2018). Updated (8-3-2022): This protocol offers an active bug bounty of $250K.
• The docs show 6 audits for OUSD and 3 audits for OGV and OGN (7-2022).
• Scored 86% on DeFi Safety (8-3-2022):

"There are only API functions documented in Origin's documentation. This protocol has undergone formal verification on the token contract. The rest of the protocol was not in scope for Certora's review. OUSD has been audited multiple times, though each was post-launch."

With the comment:

"Despite a rocky genesis with a harsh lesson in shipping unaudited code, the team quickly learned and has shown incredible resilience in the face of this. Their protocol scores highly thanks to great oracle documentation, consideration of timelocks as well as strong testing. In addition, their formally verified token contract proves that this protocol's commitment to security has really grown into an integral part of its operation. This token might consider better documentation on software function documentation in contracts, as well as slightly clearer traceability of contract code to contract deployments. These are minor improvements to be made in the face of a great developer team with a good commitment to the highest process quality standards."

• From Secureum (24-1-2021):

"After the attack, they fixed the missing validation and reentrancy vulnerability (and other issues) as suggested by the ToB audit. They conducted another audit with Solidified, are engaging with Certora for smart contract formal verification and plan to engage with OpenZeppelin for auditing upgrades.

They integrated Slither/Echidna in their CI/CD process, check PRs more stringently for security aspects and review other DeFi hacks more carefully. They’ve introduced automated monitoring for large/failing transactions along with a fast-pause feature where two multisig holders can pause minting/redeeming to respond to any similar future incidents. They’re also working with Nexus Mutual and Cover Protocol for DeFi insurance.

They have since then relaunched with ongoing compensation and proclaimed deeper commitment to security."

Bugs/Exploits

• A further break down of what went wrong, with the audit itself used in the article (24-1-2021).

• From Bitcoin.com (14-12-2020):

"The Origin Protocol team has unveiled a compensation plan for its depositors who were adversely affected by the flash loan attack in November. According to the team, there is now a plan to provide compensation equal to 100% of the value deposited to OUSD at the time of the exploit. The update says founders will not receive any compensation as a part of this plan despite having lost over $1 million in the hack."

• From CoinDesk (17-11-2020):

"Stablecoin project Origin Dollar (OUSD) sustained a re-entrancy attack at 00:47 UTC Tuesday resulting in a loss of funds worth $7 million, including over $1 million deposited by Origin and its founders and employees. The team has disabled deposits Tuesday’s attack utilized a flash loan and flaws in OUSD contracts to initiate what is known as a “rebase,” according to Etherscan and an updated blog from the team. The attack artificially inflated the supply of OUSD tokens within the protocol before swapping the newly printed tokens on SushiSwap and Uniswap for USDT, the blog states. Early reports indicated that Origin Protocol had suffered a $3.5 million flash loan attack or pricing oracle attack. Although the attacker employed a flash loan, Origin has not cited oracle manipulation as the technical culprit."

• From this article (20-11-2020):

"Origin has now announced a $1 million bounty reward for anyone who can bring the hacker responsible for destabilizing its stablecoin to justice."

Governance

Admin Keys

• From their docs (4-2022):

"The Origin team uses two different Gnosis multisig wallet contracts in order to make changes to the protocol. These multisig wallets have been audited by OpenZeppelin, ConsenSys Dilligence, Origin’s team, and others. The primary admin is a 5 of 8 multisig contract which is required to make any code changes to the protocol. OUSD can only be upgraded from this 5 of 8 multi-sig wallet. The keys to this multi-sig are held by individuals with close ties to the company, and not even the Origin founders acting together have enough control to execute owner functions on their own. In addition, the OUSD contracts are owned by a timelock which places a 48 hour time delay before any changes to the protocol can be made. Once several upgrade cycles have been completed, we intend to transfer ownership from our company control to a decentralized governance contract, thereby allowing the community to vote and participate in future protocol updates.

Some functionality, such as rebalancing funds between strategies or pausing deposits, can be triggered without the timelock and with far fewer signers. This allows the Origin team to react more quickly to market conditions or security threats. These signers, known as Strategists,  have the ability to execute a limited number of functions with only 2 of 9 signers. The strategist multisig can do the following actions on the vault:

1. reallocate - move funds between strategies
2. setVaultBuffer - adjust the amount of funds held outside strategies for cheaper redeems.
3. setAssetDefaultStrategy - which strategy mints and redeems pull from for a particular strategy
4. withdrawAllFromStrategy - remove funds from a single strategy and send them to the vault
5. withdrawAllFromStrategies - remove funds from all active strategies and send them to the vault
6. pauseRebase - pause all rebases
7. pauseCapital - pause all mints and redeems
8. unpauseCapital - allow all mints and redeems"

• From DeFi Safety (8-3-2022):

"Admin control information was well documented at this location. The relevant contracts are identified as upgradeable, as identified here. Some smart contract change capabilities are identified, but definitely not all of them. This protocol's pause control functions are documented and briefly summarized. This protocol has good timelock documentation which can be found at this location."

DAO

• From a Prime Rating Report (6-6-2022):

"Origin Protocol’s active voters are less than a number of the fingers in hand. It is hard to assume that there is a process of governance at all. Most proposals are voted by only the core developers with their significant staking power. There happens to exist extra voting participants here and there without any contribution or comment option due to a lack of governance forum or environment. The average user number that participating in proposals is only 3 to 5 core developers with their massive OGN powers, with some proposals approved by only 1 user. On top of that, there appear to be no proposals created from the community, only repetitive weekly allocation updates. There are 0 threads created in the CommonWealth account of Origin Protocol."

• For OUSD. From the docs (2-2022):

"veOGV holders are encouraged to participate in creating and voting on proposals that impact the protocol in the OUSD governance portal. Anyone with at least 10,000 veOGV in their wallet can create a new proposal using Snapshot. veOGV holders can also delegate votes to another account. That being said, in the very early days, it is imperative that the core engineering team can act quickly and decisively to build the foundational parts of the protocol. Decentralization will progress across four phases rapidly over the next few months. It is our intent to relinquish control and governance to the community as soon as possible."

Token

• Has the OGV, OGN and the OUSD tokens.

Utility

• Staking, governance and fee sharing (3-8-2022).

Other Details

• OGV is the governance and revenue token around OUSD.
• OGN is more related to NFTs.

Coin Distribution

• It's analytics board shows (3-8-2022) that 2/3rds of the OUSD supply is in the hands of wallets with more than $2M.

Tech

• Whitepaper or docs can be found here.
• Code can be viewed here. From DeFi Safety (8-3-2022):

"At 2887 commits, this protocol clearly pays due respect to its origin story."

Implementations

• Built on: Runs on Ethereum and uses IPFS

How it works

• To read about its OUSD concept, check the docs here.

"OUSD generates yields by deploying the underlying stablecoins that were deposited to the OUSD smart contract to other DeFi protocols such as Compound, Aave, and Curve. There may be new diversified strategies added to the vault in the future. Collected interest, trading fees, and rewards tokens are pooled and converted to stablecoins to produce OUSD-denominated yields. Over time, the protocol will move assets in and out of different liquidity pools in order to provide the best yield to the holders of OUSD.

The generated returns are passed on to the holders of OUSD via constant rebasing of the money supply. OUSD constantly adjusts the money supply in response to the yield the protocol has generated. This allows the price of OUSD to stay pegged at $1 while the balances in token holders' wallets adjust in real-time to reflect yields that have been earned by the protocol. The end result is a stablecoin that is easy to spend, earns outsized yields automatically, and is more desirable to hold than existing stablecoins."

Fees

• From their docs (28-7-2022):

"10% of all yield generated by OUSD is collected as a protocol fee. This fee will be used to buy back OGV on the open market to be distributed as additional rewards for stakers."

• For OUSD. From the docs (2-2022):

"A 0.25% exit fee is charged upon redemption with the vault. This fee is distributed as additional yield to the remaining participants in the vault (ie. other OUSD holders). Users can often avoid this fee by selling to an AMM instead."

Staking

• From their docs (28-7-2022):

"If you're familiar with Curve Finance's governance token model, you'll notice that OUSD's is similar in many ways. However, we introduced several improvements that drastically reduce the code complexity and gas costs for stakers of OGV. Here are a few differences between the two implementations:

1. OGV holders can stake for multiple periods of time from the same Ethereum account.
2. OGV stakers can delegate their votes, allowing for users to participate in governance from a hot wallet while holding a large amount of OGV in a cold wallet or with an insured custodian.
3. veOGV uses an exponential decay function as opposed to veCRV's linear equation.
4. veCRV holders see their balances go down as time passes, ending at 0 when their lock-up periods expire. veOGV holders see their balances remain the same throughout their lock-up periods. Instead of their balances falling, their share becomes a lower percentage of the overall vote-escrowed token supply."

• From their website (3-8-2022):

"When OGV is staked, it's converted into veOGV (or “vote-escrowed OGV”) and becomes non-transferable while earning fees as OUSD adoption grows. On day one, veOGV holders can claim 10% of the yield generated by the protocol. As OUSD adoption accelerates, the benefits accrue to the holders of veOGV. The maximum staking duration is 4 years. The minimum is 30 days.

You can buy OGN tokens and stake them to earn part of the commissions that Origin Story makes on NFT primary and secondary sales."

Oracle Method

• From their docs (4-2022):

"As a decentralized protocol, OUSD must rely on non-centralized sources for these prices. OUSD uses Chainlink oracles for pricing data for DAI, USDC and USDT. You can read more about our decision to work with Chainlink on our blog."

• From DeFi Safety (8-3-2022):

"The protocol's oracle source is partially documented at this location. The contracts dependent are identified. There is no relevant software function documentation, but the deltas of each price source are clearly outlined. This protocol documents front running mitigation techniques. This protocol documents flashloan countermeasures at this location. It has implemented Chainlink. This could be stated explicitly to reassure users."

Regulatory

• From a Prime Rating Report (6-6-2022):

"Origin Protocol has two different legal structures: Origin Protocol Inc is listed as Corporation based in the USA, and Origin Protocol Labs which develops Origin Protocol is listed as a legal entity based in the Cayman Islands. According to records in OpenCorporates, Origin Protocol Inc. is founded in Delaware (US) in 2017, opened its branch in San Francisco - California (US) in 2018, and assigned Co-founder Matthew Liu as the representative agent. Established the non-profit live company named Origin Protocol Foundation in Singapore in 2019. Lastly formed another for-profit corporation in Colorado (US).

Origin Protocol Labs is a Privately Held company established in the Cayman Islands and its primary industry is listed as Financial Software according to the Terms of Service document provided on its website.

With both legal entities connected to the protocol and public information about those entities available to the extent of the project co-founder as a representative agent, users and partners can hold the protocol accountable in case of a breach of the agreement."

Their Projects

Origin Dollar (OUSD)

• From CoinDesk (17-11-2020):

"OUSD is backed by deposits of USDT, USDC and DAI and is designed to act somewhat like a savings account."

• It got hacked for $7M in a flash loan attack (17-11-2020).
• Cover Protocol, has added coverage support for OUSD (25-1-2021).

Roadmap

• Can be found [Insert link here].

Pros and Cons

Cons

• After a flash loan attack (17-11-2020) the team halted deposits for their stablecoin, this hints towards centralization.

Team, Funding, Partnerships, etc.

Team

• Full team can be found here.
• Josh Fraser; Co-Founder (also advisor to MARKET Protocol)
• Matt Liu, Co-Founder
• As advisors it names Melody He (Spartan Group), Paul Veradittakit, Joey Krug, Andrew Kang, Justin Blau (3LAU) and Paris Hilton (3-8-2022).

Funding

• From a Prime Rating Report (6-6-2022):

"Origin Protocol has so far been required to raise money only from accredited investors. This requirement is because they are based in the United States, a country with strict laws and guidelines for raising money through private placements. In the beginning, Origin Protocol took the attention of Pantera Capital Venture with its decentralized sharing economy approach and raised $3M in Dec 2017 as Advisor Sale. In April 2018 Origin has raised a $28.4M Strategic Sale round from strategic partners around the world to capitalize on the project and broaden its global presence. It is reported that they held one-on-one conversations with each investor to ensure they were committed to delivering additional value beyond their capital contributions. Reportedly there were about 190 investors have committed and most of those investors were friends of Origin Protocol co-founders. When some investors' backgrounds and current positions were taken under consideration, the potential value of those strategic partnering emphasized itself:

1. Foundation Capital, a venture investor in sharing economy companies like Uber, Luxe, and Peerspace
2. Garry Tan, former Y Combinator partner and first investor in Coinbase and Instacart
3. Alexis Ohanian, founder and former CEO of Reddit
4. Gil Penchina, AngelList’s top syndicate lead
5. Kamal Ravikant, an investor in Protocol Labs (creator of IPFS and Filecoin)

In July 2018, Origin Protocol has raised an additional $6,6M from CoinList Sale Round where total raising fund intentionally capped to $6,6M and focused to increase the number investors participating to protocol with limiting maximum amount investing per investor. Paris Hilton invested in the Origin Protocol and joined as an advisor (6-8-2022)"

• Has investment from Consensus Capital ("we’re a partner who supports their growth.")

Partners

• Has a partnership with MARKET Protocol (still as of 8-2019)
• Part of the portfolio of SVK Crypto

(:

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