SLC Request - Incentives for March 2025
This is a proposal to allocate SWISE from the StakeWise DAO Community Treasury to the StakeWise Liquidity Committee (SLC) 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 (link) 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 previous months, see the following chart:
Report on the incentive allocation in February
| Inflows (Budget) | Outflows | |
|---|---|---|
| SWISE liquidity pool | 860,000 SWISE | 860,000 SWISE |
| osETH liquidity pools (Mainnet) | 5,940,000 SWISE | 5,720,000 SWISE |
| osETH liquidity pools (Arbitrum) | 600,000 SWISE | 600,000 SWISE |
| osGNO Liquidity pools | 400,000 SWISE | 0 SWISE |
| Total | 7,800,000 SWISE | 7,180,000 SWISE |
Starting SLC Safe Balance: 899,690 SWISE (1-February-2025)
Ending SLC Safe Balance: 1,519,690 SWISE (1-March-2025)
osETH liquidity pools (Mainnet)
Liquidity in the osETH-ETH pool on Balancer remains solid, with a current total value locked (TVL) of $43 million based on ca 19.5K ETH worth of tokens. The osETH-rETH pool on Curve remained stable month to date, with liquidity of around $18 million based on ca 5.5K ETH worth of tokens.
We highlight the decline in osETH-USDC pool liquidity from $50K~ish levels to $7K as the incentives have been stopped. The original purpose of the pool was to direct more volume to the osETH-ETH pool as part of the arbitrage trades, creating trading volume, fees, and checking the box for needing 3 trading venues for osETH to qualify for a Chainlink oracle. However, in recent months liquidity in the pool has been dropping despite consistently high incentives, which led to a decline in volume accrual for the osETH-ETH pool, defeating the original purpose of issuing incentives. In addition, obtaining a Chainlink oracle was deprioritized as the Redstone oracle is actively being used instead. Hence, we have decided to stop incentivizing the osETH-USDC pool, and will not request incentives for it.
osETH liquidity pools (Arbitrum)
The combined liquidity levels for osETH pools on Arbitrum sits at around $0.6 million vs ~$1M a month ago, consistent with the decline in ETH prices.
At current TVL levels, allocated SWISE incentives provide an APY exceeding 15% for LPs. The team will continue to monitor the impact of incentives on liquidity, and will reduce the expenditure if liquidity doesn’t pick up.
osGNO liquidity pools
The osGNO-GNO liquidity pool on Balancer sits at around $1M in TVL vs $1.5M a month ago, consistent with the decline in GNO price. This pool is not currently receiving SWISE incentives, being incentivized instead by the Gnosis ecosystem participants. With ca 14% APY for LPs, we believe the level of incentives provided in the pool is already attractive, which has held us back in allocating SWISE in the pool as well. The team will continue monitoring the situation and will commence liquidity incentivization if needed.
SWISE liquidity pool
There are no major inflows or outflows to report.
Proposed budget for March 2025
| Inflows (Budget) | |
|---|---|
| SWISE liquidity pool | 860,000 SWISE |
| osETH liquidity pools (Mainnet) | 5,720,000 SWISE |
| osETH liquidity pools (Arbitrum) | 600,000 SWISE |
| osGNO Liquidity pools | 0 SWISE |
| Total | 7,180,000 SWISE |
osGNO liquidity pools
With a substantial reserve built up from the previous months, and the high level of incentives in the pool as of today, we are not requesting any new tokens for the osGNO-GNO pool in March.
SWISE liquidity pool
The aim is to maintain current liquidity, requiring 860k SWISE per month at current market prices.
osETH liquidity pools Mainnet
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 5.94M SWISE per month for mainnet.
osETH liquidity pools Arbitrum
The liquidity depth of osETH pools on Arbitrum is currently below optimal levels and requires improvement. To address this, an allocation of 600,000 SWISE per month has been designated. A repeat from February, this allocation has failed to attract more capital into the pools in the last month, but we’re willing to give it another try this month. Should it fail to improve liquidity in the pool, the team will consider lowering the incentives.
Vote
Vote for the new incentives package here: Snapshot
Please share your feedback and comments below!