As part of the SPS Validator transition, three important cleanup tasks have been identified that require DAO approval:

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1. Fix Ranked Rewards Buckets

During the transition to the SPS Validator system, a misconfiguration occurred in the minting of SPS into the Ranked Rewards buckets.

The intended distribution for Ranked Rewards was 1.5 million SPS per season per format (Modern and Wild), which included:

• 900,000 SPS per season originally allocated directly to ranked battle rewards, and

• An additional ~600,000 SPS per season that used to be distributed via rewards chests (prior to SPS being removed from chest loot)

While the correct amount of 1.5 million SPS per season per format has continued to be paid out to players, only 900,000 SPS per season per format has been minted into the respective rewards buckets.

This has caused the buckets to drain over time, creating a 25 million SPS shortfall in both the Modern and Wild Ranked Rewards pools, for a total deficit of 50 million SPS.

Proposal Action:

Transfer 50 million SPS from the SPS.DAO to the individual reward buckets.

• 25 million SPS will be deposited into the Modern Ranked Rewards bucket

• 25 million SPS will be deposited into the Wild Ranked Rewards bucket

This one-time correction will restore the SPS Ranked Rewards reward system to its intended levels.

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2. Consolidation of Lite Account SPS

During the validator transition, some Lite Accounts (used by email-based players without Hive keys) had SPS and VOUCHER balances. These players no longer have access to claim or manage these tokens without intervention as lite accounts can not sign a HIVE transaction which means the validator can not validate any transactions for lite accounts.

To preserve the ability to recover funds for returning players and clean up token records, we propose the following:

Proposal Action:

• Create a new Splinterlands-controlled account: SL-CS-LITE

• Claim all outstanding staking rewards from Lite Accounts

• Unstake all SPS held in Lite Accounts, as a 1 time immediate action.

• Export a full CSV ledger of account balances for future customer support use

• Transfer all remaining SPS and VOUCHER balances from Lite Accounts to SL-CS-LITE for safekeeping and re-distribution to customers that may convert their lite accounts to full accounts at some point in the future.

This move will ensure any returning player with a verified claim can be manually credited by the Splinterlands support team, while simplifying on-chain accounting.

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3. Correcting SPS Staking Discrepancy

During an audit post Validator network launch, a discrepancy in the token balances between staked SPS and the system account where staked SPS is held was discovered. The amount is relatively small (571,849.75 SPS) and after monitoring the discrepancy we were able to deduce that the amount was fixed and not variable. After further research we were able to deduce the origin of the discrepancy stemmed from a decision made by a former developer that chose to manually adjust the number in the staking database that was used at the time rather than to accurately track the origin of the discrepancy and properly correct it.

To rectify that decision, we propose that the Splinterlands company supply the SPS tokens needed to restore balance and integrity to the staking accounts and that the DAO take the following corrective actions:

Proposal Action:

• Splinterlands should transfer 571,849.75 SPS to the $TOKEN_STAKING system account.

• The SPS Validator network will need to remove 571,849.75 SPSP from the $TOKEN_STAKING system account in the next fork.

This adjustment will ensure that in the event that every SPS were to be unstaked, the system account where these tokens are stored would be able to back every single SPSP with liquid SPS tokens.

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Conclusion

This proposal corrects a misallocation in SPS distribution for ranked rewards, responsibly consolidates Lite Account balances for long-term support handling and ensures that our on-chain accounting has the highest level of integrity possible. These changes are purely administrative and do not impact current or future tokenomics outside of fixing a prior distribution oversight.

We ask for your support to approve this one-time correction and cleanup.