Proposal: Disband SLC in favour of team-led liquidity incentives allocation process

Proposals
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Executive Summary

This proposal seeks to disband the StakeWise Liquidity Committee (SLC), transferring responsibility for reporting on the liquidity situation, budgeting, and liquidity incentives allocation directly to the StakeWise team. This proposal is driven by considerations around reduced bribing volumes, operational efficiency, and SWISE spend. Importantly, we seek to maintain the current monthly report structure and budget requests to ensure continued transparency into the incentives allocation process.

Motivation

The motivation to disband the SLC is based on three primary reasons:

  1. Reduced Bribing Volume: The gradual decrease in bribing volume for Balancer & Curve has made liquidity incentives allocation a more straightforward process, diminishing the need for a separate, dedicated committee to manage it. The previously complex calculations around the most efficient path to receiving liquidity have been reduced to direct incentives allocation, not least because of the token price decline. While the need for bribing may reemerge in the future, we believe the expert-led side of the SLC is currently not being utilized, and hence this expense can be spared.

  2. osETH Liquidity Stability: Through the SLC’s efforts, osETH has reached a robust liquidity position that no longer requires the intensive management and intervention that was essential during the early stages. The SLC’s original goal has been successfully achieved, where maintaining a dedicated committee is no longer pivotal for ongoing liquidity stability.

  3. Resource Efficiency: By disbanding the SLC, StakeWise can reduce operational overhead and reallocate resources, both in terms of SWISE spend and team bandwidth, towards critical growth-oriented projects. As the team’s focus sharpens on protocol and token expansion in the ecosystem, this streamlined approach will support sustainable growth.

Specifications

Should this proposal receive community approval:

  1. The external expert-led multisig (0xDb14C8bc1a98B6c79A2BD7d9fE1fc71437970704) will be removed as a signer from the SLC Master Safe (0x189Cb93839AD52b5e955ddA254Ed7212ae1B1f61). While the Master Safe will remain the vehicle for allocating incentives across various pools, it will be controlled solely by the team, which will continue requesting a monthly SWISE budget.

  2. The final compensation for all SLC members will be processed in early November to acknowledge their significant contributions to the protocol’s liquidity growth, and is baked into the November budget request (link).

  3. Monthly reports and budget requests will continue under the StakeWise team’s management to ensure continuity in the reporting structure and provide the community with consistent insight into incentives allocation.

Considerations

Disbanding the SLC may have certain implications that should be carefully weighed by the community:

Potential Loss of External Expertise: The SLC structure allowed for external experts to contribute their insights, which may no longer be as readily available. However, the team will remain open to external consultation as needed.

Responsibility Concentration: With liquidity incentives now directly managed by the team, some may perceive an increase in centralized decision-making. To mitigate this, the team will adhere to established transparency standards, including monthly reports and budget reviews, to maintain community confidence, and is committed to an open line of communication.

Discussion

The Snapshot vote is now live - please make your voice heard by voting Yes or No in this proposal. As always, we heartily welcome your comments & feedback :heart:

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