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 here.
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 | |
|---|---|---|
| SWISE liquidity pool | 800,000 SWISE | 830,000 SWISE |
| osETH liquidity pools | 6,300,000 SWISE | 6,747,995 SWISE |
| SLC compensation | 144,300 SWISE | 144,300 SWISE |
| Total | 7,244,300 SWISE | 7,722,295 SWISE |
Starting SLC Safe Balance: 12,817,443 SWISE (18-Apr-2024)
Ending SLC Safe Balance: 5,164,300 SWISE (15-May-2024)
Recent SWISE price performance and negative economics for bribing (where $1 spent on bribes yields less than $1 in incentives) resulted in the doubling of our monthly token expenditure towards liquidity mining incentives.
We recognize the burden this has on the token - increased emissions are never a good thing - but believe that maintaining existing levels of liquidity is important for the further development of StakeWise and osETH.
Our liquidity strategy has been really effective in getting osETH onboarded to Aave within a short timeframe, opening up significant growth opportunities for the protocol. With the ongoing application to get onboarded on Compound, which could be another growth catalyst for StakeWise, we feel that maintaining the current level of liquidity, and thus accepting the significantly above-average amount of incentives, is warranted to ensure continued success for planned osETH integrations.
osETH liquidity pools
Liquidity levels remained strong across all pools, with no major capital inflows or outflows to report.
SWISE liquidity pool
There are no major inflows or outflows to report.
Proposed budget for Month 8
| Budget | |
|---|---|
| SWISE liquidity pool | 860,000 SWISE |
| osETH liquidity pools | 6,720,000 SWISE |
| SLC compensation | 182,640 SWISE |
| Total | 7,762,640 SWISE |
SWISE liquidity pool
The aim is to maintain current liquidity, requiring 860k SWISE per month at current market prices.
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 6.7M SWISE per month at current market prices.
SLC compensation
$5k in SWISE @ 0.02738 USD per SWISE (30d avg) => SWISE 182,640 (as approved by the DAO during the implementation of the SLC).