Union, a member owned credit network protocol where any address can permissionlessly underwrite any address, is excited to deploy version 2 of its protocol to Optimism.

Version 2 of the Union Protocol is the culmination of a year of hard work and testing, and is a significant upgrade over v1. It solves the two biggest friction points with v1: size limitation of each members personal network and predictability of liquidity.

Union Version 2 was announced and deployed to the Optimism Goerli testnet 3/24, and after months of review is now live on Optimism!

You can start playing with it now at app.union.finance. (click v2 to see the optimism v2 option ;)

If you're familiar with v1, to become a member and get a credit line on optimism you will need to find someone to vouch for you on optimism, but thanks to the higher vouchee limits that someone can now be a smart contract. (make sure to read to the end for a surprise, and a bypass to having to know an existing member 🤖)

1. In Version 2, the maximum number of addresses one can underwrite has increased from 25 -> 1000 and be underwritten by from 25 -> 400 from a single account.

2. Bad debt no longer accrues indefinitely: If you vouch for a defaulter, the writeoff function becomes publicly callable after a set amount of time in default. This is essential for growing liquidity— on Optimism this will be set to 60 days, meaning if someone borrows and makes no payments, anyone will be able to call the function after 90 days.

3. Union Lens Contract : Union is a call-intensive protocol. This view layer contract consolidates view helpers making it a lot easier to build frontends and integrations.

4. More efficient and predictable gas costs : v2 uses struct packing and other techniques to dramatically reduce storage read and writes compared to v1 . Vouching now has a constant gas cost, in V1 the gas cost was dependent on number of vouchers(O(n)) but in v2 it is constant (O(1)).

5. Changed from block-based timing to seconds, makes 'due by' dates 1000x more human and integration friendly.

Credit!

Credit is a powerful economic tool. At it’s most basic it lets those with surplus resources allocate idle cash to those with ideas, or an immediate need. And when someone borrows to purchase something productive, Credit has the potential to create positive sum growth.

Optimism has a number of protocols oriented around identity, attestation, and reputation that when paired with a permissionless credit network enables a lot of exciting new forms of credit formation.

To hint at a few:

• Credit Associations: all variants of more traditional forms of credit can be implemented on Union. And protocols like Optimism attestations or Otterscore can enable the onchain and permissionless version of career based credit unions e.g. an isTeacher attestation by other teachers could give access to a "Teachers Credit Union", same with isCoreDev, isArtist, and so much more.

• DAOs underwriting their Members: dao’s can now vouch for most of their members from a single timelock or vouching contract. Maybe instead of straight cash for onboarding quests the DAO could underwrite new users or Optimistically give repeat governance contributors credit to permissionlessly spend, like a dao version of a company amex.

• More Available Credit: You can now vouch for large swaths of addresses with specific traits or attestations. — e.g. Take any number of on or offchain traits an extend credit at scale.

• Borrow from Hundreds of People: With the ability to be backed by hundreds of people and DAOs, users can access even more significant credit lines — What can you do with a dao-owned credit line backed by 400 people and dao’s?

• Exciting credit experiments:  the most underrated aspect of being able to vouch for 1000 addresses is you now have a statistically significant sample size, we expect to learn a great deal in the months ahead. If you’re interested in running a credit experiment, feel free to reach out.

The v2 core contracts were deployed 2 days ago and tested for soundness manually and with automated tests.

You can view the contracts and deployments at: https://github.com/unioncredit/union-v2-contracts/

As with previous L2 deployments there will be a launch period where an optimism-based multisig will have admin powers in the event that any change needs to be made faster than the 6 days of full governance, or the 1 day of the L1 emergency admin key. During that launch period the L1 governance will progressively increase the limits, and then when things are deemed stable enough, the optimism admin key will be revoked leaving just the optimism pause guardian and L1 governance.

A few post deployment notes:

1. Comptroller Drip - the comptroller on OP has been seeded with 50K UNION and an initial 30 day drip of 1 UNION per block. This will provide some initial UNION for early testers to register, but if UnionDAO wants to fully adopt this deployment the dao will need to put together a more long term proposal.

2. During initial testing the HalfDecay Point was set low at 1000 DAI, we didn't want anyone to earn more UNION than needed during the mainnet validation stage before going public. About 15min after this is posted to twitter this will be raised to 500,000 to ensure fairness.

Relevant Governance Addresses:

• 3 of 6 opMultiSig: 0x652AbFA76d8Adf89560f110322FC63156C5aE5c8 2.

• opPauseGaurdian: 0xF7dc916eC6ee854b3a32f5D8DcF2ED0582e05Dc3 3.

• opOwner: 0x946A2C918F3D928B918C01D813644f27Bcd29D96

If you find any oddities, bugs, or things that don’t make sense, please report them via Discord #support, Github Issues or DM @unionprotocol on twitter.

To celebrate Union deploying on Optimism, and also to highlight that a contract using Union can now vouch for 1,000 different addresses, we've created what we hope is the first of many experiments in smart contract based vouchers.

We have created an erc1155 Vouching contract that you can send the below Optimistic Redeemable Voucher NFT to, and on receipt it will vouch for you autonomously on Union.

While this is a toy example, it highlights one of the powerful things that makes onchain credit unique, not simply a copy of traditional credit systems. The "person" underwriting you can be a smart contract with any arbitrary conditions either expressed as logic in the contract or by accepting any kind of NFT as collateral or payment. And anyone can deploy as many as they want.

More near term, Onboarding via a vouch also has the added bonus that the seeding member set at launch will be a lot more decentralized.

If you’d like to try onchain credit and don’t know a current member, or just want to help stress test and get the voucher to 1000, Here's How to Participate:

1. Mint the above NFT

2. After minting you'll have a VOUCHER NFT designed by Unions talented design lead murf.eth

3. You can choose to keep it as a souvenir or you can send it to {0x17A8B52d34443AE1027852343B4e89014B8Fcf17} and receive a $20 vouch. //note that only the first 1000 to send to the contract will be able to redeem a vouch.

Credit is a critical piece of the Real Economy, its a life line and only source of funding for most people and small businesses around the world. Now that Union v2 is live on Optimism, we are excited to see a Real Economy take shape in DeFi!

Finally, I’d like to end by giving credit to all the Union devs who worked to build and deploy this upgrade to permissionless credit.