Prop 10: v2 Software Upgrade

Babylon version v2 incorporates the following major features:

• Tokenfactory: Enables permissionless creation and management of native tokens using a Babylon-maintained fork of Strangelove’s x/tokenfactory module.

• IBC Callbacks: Enables atomic "send X, then programmatically do Y" operations in smart contracts. This allows seamless cross-chain interactions - such as asset swaps- without requiring gas tokens on the destination chain, significantly improving user experience.

• IBC Rate Limiting: Controls the inflow and outflow of assets over IBC channels to prevent malicious draining of funds within short time frames.

• Packet Forwarding Middleware: Enhances IBC capabilities by enabling automatic forwarding of packets to other chains. Incorporating this middleware would extend Babylon’s IBC functionalities, improving user and developer experiences by simplifying multi-hop token transfers and general cross-chain messaging.

• Interchain Accounts (ICA) and Interchain Queries (ICQ): Enables seamless cross-chain composability and programmability in Babylon Genesis network. Interchain Accounts allow one blockchain to control an account on another blockchain, while Interchain Queries provide a standardized mechanism to read data from remote chains.

A CosmWasm security patch is also included in this version.

Lastly, the x/crisis module is deprecated in this release, leading to the removal of the --x-crisis-skip-assert-invariants babylond startup flag.

To ensure a smooth upgrade, we kindly request the following actions from you:

During the governance proposal (until June 15, 12 PM UTC):

• If you are a CometBFT Validator, vote YES for the governance proposal (ref).

Prior to the upgrade height (before June 16, 12 PM UTC):

• Prepare the upgrade binary by following the instructions documented here.

When the upgrade height is reached (on June 16, around 12 PM UTC):

• Perform the steps documented here to upgrade your node
  • Make sure to remove the --x-crisis-skip-assert-invariants babylond startup flag, in case you were using it
• Verify that the upgrade was successful
  • If you are a CometBFT Validator, verify that your node is signing new blocks.
  • If you are not a CometBFT Validator, verify that your node is syncing the latest blocks.

We appreciate your prompt action to help minimize disruptions to the Babylon Genesis!