Intro
This is a proposal to allocate SWISE from the StakeWise DAO Community Treasury to the StakeWise Liquidity Committee to be used solely to incentivise the liquidity ecosystems of all StakeWise tokens. Please take the time to review the report from the previous month and the proposed budget for the upcoming month before voting. The vote is live and can be found on Snapshot here.
The migration of liquidity from StakeWise V2 to V3 has been a success. Liquidity generation for osETH has been fast and effective, allowing for our partner Redstone to begin work on creating an osETH-ETH Price Oracle without delay. This Price Oracle is due to go live before the end of the year and enable the next set of integrations for osETH.
SWISE emissions have also been well managed and ultimately reduced throughout the transition period. This reduction is in part due to the reduced amount of liquidity for osETH compared to sETH2, but more importantly, the quality of liquidity is greatly improved alongside the capital efficiency of incentives. For a high level overview of how StakeWise DAO’s SWISE emissions have evolved over the years, see the following chart:
Report on last month’s incentives allocation
| Inflows (Budget) | Outflows | |
|---|---|---|
| sETH2 farms | 3,300,000 SWISE | 1,100,000 SWISE |
| SWISE liquidity pool | 500,000 SWISE | 500,000 SWISE |
| osETH liquidity pools | 0 SWISE | 1,575,139 SWISE |
| SLC compensation | 81,625 SWISE | 81,625 SWISE |
| Total | 3,881,625 SWISE | 3,256,764 SWISE |
Starting SLC Safe Balance: 6,881,625 SWISE
Ending SLC Safe Balance: 3,624,861 SWISE
Extending sETH2 farms
The SLC continued to deploy incentives into the sETH2 farms up until the launch of StakeWise V3. Of the 3.3M SWISE that was budgeted for the month, only 1.1M was spent with the remainder held in reserves.
osETH liquidity pools
The SLC successfully launched and deployed incentives to all three of the DAO-approved osETH liquidity pools. Capital inflows were fast and exceeded expectations, with osETH liquidity rapidly reaching a total of $50M across the pools.
SWISE liquidity pool
500k SWISE was deployed over the month into the pool and there are no major inflows or outflows to report.
Proposed budget for Month 3
| Budget | |
|---|---|
| SWISE liquidity pool | SWISE 500,000 |
| osETH liquidity pools | SWISE 2,700,000 |
| SLC compensation | SWISE 56,350 |
| Total | SWISE 3,256,350 |
SWISE liquidity pool
Continue with the same amount of incentives as per the past several months (500k) to maintain current liquidity levels.
osETH liquidity pools
The current liquidity depth is strong vs the overall TVL of StakeWise V3 and should be maintained. The expected cost for doing so is around 2.7M SWISE per month at current market prices.
SLC compensation
$5k in SWISE @ 0.08873 USD per SWISE (30d avg) => SWISE 56,350 (as approved by the DAO during the implementation of the SLC).