Simple Summary
This proposal is about diversifying the treasury by allocating 45M $PSP over the next 3 months to acquire $CVX that will be locked and used to create a gauge on Curve V2 for a future $PSP/ETH pool, and influence the rewards by voting. Until then we could also accumulate more governance power and/or yield with bribes earned.
Context
The rewards on Curve are changing every week, and are decided by votes, so we need an important voting power to influence the vote in favor of ParaSwap DAO. As a vlCVX (CVX locked) control several veCRV (CRV locked) but in the future, also other ve tokens like FRAX, we propose to start accumulating voting power with the DAO quickly.
More informations on the Curve war can be found here:
Use the CRV war to influence CRV rewards on future $PSP pools
Rationale
I’ll be working on a full proposal with @Jeanbrasse and @tokenBrice to explain all the details, as this proposal is only to vote on the total budget allocated.
However, here is a list of the possible ways to accumulate CVX:
Gnosis auction
Balancer LBP
PSP leverage
Uniswap V3 pool
UMA KPI Options
ParaSwap DAO bonds
The proposed budget is 15M $PSP/month for the next 3 months.
Voting options
Accept the Curve war & $CVX budget (45M $PSP, 18.93% budget)
Refuse the Curve war & $CVX budget (45M $PSP, 18.93% budget)
Abstain
Should we allocate a budget to enter the Curve WAR ?
Accept the Curve war & $CVX budget (45M $PSP, 18.93% budget)
Refuse the Curve war & $CVX budget (45M $PSP, 18.93% budget)
Some of these seem quite attractive would love to see a KPI Options or an auction/lbp, has there been any thought to using one or many OTCs ? Would be another way to not create drag on price.
Some of our Doxxed Private Market Makers like Wintermute and WOO actually have OTCs we could maybe reach out to if we want to pursue this as a possible option.
As said in PS reschearch Positive Slippage Income the positive slippage income accumulate some crv/cvx and ( 2,210 crv and 155 cvx ) links (again ) : ethscan and debank. Yes I agree with it’s not a lot to have an impact on voting power but we accumulate indirectly crv/cvx so , I think if we want accumulate CRV/CVX we must use crv/cvx positive slippage income to start our cvx / crv bankroll. it’s not a good idea to leave this token on this contract and don’t use it
Probably, one of the most exciting part of the budget. This is a real way to control liquidity, get voting power and give ParaSwap real intrinsic value with less $PSP price dilution effect on the long run.
The only questions I am wondering is diversification. Should we put everything on curve or curve like protocols ? Other solution like tokemak could be a nice choice as well …
For starters, I’m a fan of Paraswap, Mounir and the whole team.
Balancer Labs has been working on technical challenges with Paraswap and we are very happy with our collaboration. I think it would also be great if our DAOs got closer together and I see in veBAL a good alternative to the CVX purchases you are proposing. The new veBAL tokenomics proposal is not approved on snapshot yet but so far it has seen almost unanimous support so it seems very likely it will be approved by the end of this weekend.
If you engage in the BAL wars instead of the Curve wars, you have the huge advantage of being an early adopter which can prove quite advantageous to incentivize liquidity on the existing 80/20 PSP/ETH pool on Balancer. Our gauge system will also allow for joint liquidity mining incentives, so LPs in that pool could be getting both BAL and PSP.
Thanks for considering and let me know if you have any questions, happy to answer whatever I can =)
This is an interesting point. Perhaps our budget could be divided into multiple different token acquisitions. I’d be interested to know how much liquidity we could theoretically sustain with equal percentage yields or in other words how much dollar value emissions are we securing with this CVX buy. If we can determine this number we could estimate the APRs on different liquidity pool depths. I’d be interested to do the same type of analysis on BAL and other gauge tokens that could be used to build liquidity to see what we could expect on a per dollar basis.
We could definitely consider to split the governance token investments in several protocols to diversify and reduce the risk, and I agree that Paraswap could be very early on veBAL.
What do you think about a D2D TokenSwap, is it a possibility ?
Yes it is: there has already been a few token swaps like with TRIBE/FEI and GNO.
For this we would need a proposal on both forums. What would be the amount you would be looking to swap?
@Tenzent you can take a look at our current pools on app. balancer. fi and how much BAL is being given to each of them on app. balancer. fi/#/liquidity-mining