chore: finalise v1.3 upgrade handler (#113)

Co-authored-by: Troy Kessler <troy.kessler99@gmail.com> (cherry picked from commit 3c2ca41)
KYVENetwork · Jul 14, 2023 · bed8c6d · bed8c6d
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Showing 3 changed files with 37 additions and 10 deletions.
diff --git a/.github/README.md b/.github/README.md
@@ -18,7 +18,7 @@ You can find the `kyved` binary in the `./build` directory.
 If you need binaries for alternative architectures than your host:
 
 ```shell
-make release
+make release ENV=mainnet
 ```
 
 The different binaries can be found in the `./release` directory.

diff --git a/CHANGELOG.md b/CHANGELOG.md
@@ -12,34 +12,37 @@
 
 # CHANGELOG
 
+An '!' indicates a state machine breaking change.
+
 ## [Unreleased]
 
 ### Features
 
-- (ibc) [#30](https://github.com/KYVENetwork/chain/pull/30) Integrate [Packet Forward Middleware](https://github.com/strangelove-ventures/packet-forward-middleware).
-- (`x/bundles`) [#99](https://github.com/KYVENetwork/chain/pull/99) Use weighted round-robin approach for uploader selection.
-- (`x/bundles`) [#108](https://github.com/KYVENetwork/chain/pull/108) Store stake security for finalized bundles.
+- ! (ibc) [#30](https://github.com/KYVENetwork/chain/pull/30) Integrate [Packet Forward Middleware](https://github.com/strangelove-ventures/packet-forward-middleware).
+- ! (`x/bundles`) [#98](https://github.com/KYVENetwork/chain/pull/98) Split inflation rewards between chain and protocol layer.
+- ! (`x/bundles`) [#99](https://github.com/KYVENetwork/chain/pull/99) Use weighted round-robin approach for uploader selection.
+- ! (`x/bundles`) [#108](https://github.com/KYVENetwork/chain/pull/108) Store stake security for finalized bundles.
 
 ### Improvements
 
-- (`x/bundles`) [#62](https://github.com/KYVENetwork/chain/pull/62) Payout storage cost directly to the bundle uploader.
-- (`x/pool`) [#74](https://github.com/KYVENetwork/chain/pull/74) Improve parameter validation in pool proposals.
-- (`x/stakers`) [#46](https://github.com/KYVENetwork/chain/pull/46) Allow protocol validator commission rewards to be claimed.
+- ! (`x/bundles`) [#62](https://github.com/KYVENetwork/chain/pull/62) Payout storage cost directly to the bundle uploader.
+- ! (`x/pool`) [#74](https://github.com/KYVENetwork/chain/pull/74) Improve parameter validation in pool proposals.
+- ! (`x/stakers`) [#46](https://github.com/KYVENetwork/chain/pull/46) Allow protocol validator commission rewards to be claimed.
 
 ### Bug Fixes
 
 - [#96](https://github.com/KYVENetwork/chain/pull/96) Track investor delegation inside auth module.
 
 ### Client Breaking
 
-- (`x/stakers`) [#46](https://github.com/KYVENetwork/chain/pull/46) Include `MsgClaimCommissionRewards` for claiming commission rewards.
-- (`x/bundles`) [#104](https://github.com/KYVENetwork/chain/pull/104) Improve schema for finalized bundles query.
+- ! (`x/stakers`) [#46](https://github.com/KYVENetwork/chain/pull/46) Include `MsgClaimCommissionRewards` for claiming commission rewards.
 
 ### API Breaking
 
 - (`x/query`) [#87](https://github.com/KYVENetwork/chain/pull/87) Correctly return pools that an account has funded.
 <!-- TODO: Switch this link to the release tag. -->
 - (`x/stakers`) [#46](https://github.com/KYVENetwork/chain/pull/46) Emit an [event](https://github.com/KYVENetwork/chain/blob/main/x/stakers/spec/05_events.md#eventclaimcommissionrewards) when claiming protocol validator commission rewards.
+- (`x/bundles`) [#104](https://github.com/KYVENetwork/chain/pull/104) Improve schema for finalized bundles query.
 
 ## [v1.2.2](https://github.com/KYVENetwork/chain/releases/tag/v1.2.2) - 2023-06-08
 

diff --git a/app/upgrades/v1_3/upgrade.go b/app/upgrades/v1_3/upgrade.go
@@ -37,9 +37,15 @@ func CreateUpgradeHandler(
 	return func(ctx sdk.Context, _ upgradeTypes.Plan, vm module.VersionMap) (module.VersionMap, error) {
 		logger := ctx.Logger().With("upgrade", UpgradeName)
 
-		CheckPoolAccounts(ctx, logger, poolKeeper)
+		// Multiple Bundle Versions
 		UpdateBundlesVersionMap(bundlesKeeper, ctx)
 
+		// Configure Inflation Splitting
+		CheckPoolAccounts(ctx, logger, poolKeeper)
+		SetBundleParams(ctx, poolKeeper)
+		AdjustOperatingCost(ctx, poolKeeper)
+
+		// Vesting Account Delegation Fix
 		if ctx.ChainID() == MainnetChainID {
 			for _, address := range InvestorAccounts {
 				TrackInvestorDelegation(ctx, logger, sdk.MustAccAddressFromBech32(address), accountKeeper, bankKeeper, stakingKeeper)
@@ -108,3 +114,21 @@ func UpdateBundlesVersionMap(keeper bundlesKeeper.Keeper, ctx sdk.Context) {
 		},
 	})
 }
+
+// SetBundleParams initializes the parameters for inflation splitting.
+// The inflation share is 8.45 % resulting in a 40% APY on 10M target stake for the CosmosHub Pool.
+// This value needs to be adjusted by the governance in the future.
+// The inflation payout rate of 5% turned out to be a good damping factor for the inflation payout.
+func SetBundleParams(ctx sdk.Context, keeper poolKeeper.Keeper) {
+	keeper.SetParams(ctx, poolTypes.Params{
+		ProtocolInflationShare:  sdk.MustNewDecFromStr("0.0845"),
+		PoolInflationPayoutRate: sdk.MustNewDecFromStr("0.05"),
+	})
+}
+
+// AdjustOperatingCost calculates the new operating. Because of inflation splitting the
+// operating cost needs to be adjusted to a lower value to maintain the same pool APY.
+func AdjustOperatingCost(ctx sdk.Context, keeper poolKeeper.Keeper) {
+	cosmosHubPool, _ := keeper.GetPool(ctx, 0)
+	cosmosHubPool.OperatingCost = 3_100_000 // 3.1 $KYVE
+}