veDAO Incubator - Alchemix Forum Proposal
SUMMARY:
- Build a "Multi-Tenant veDAO Launchpad" on Optimism and Mainnet.
- Create and Launch two Alchemix NFT Collections which raise ETH for two Community Owned LP DAO Treasuries.
- The NFTs "own" membership shares governing that treasury.
- Mainnet Collection: 95% of sales are deposited as collateral into Alchemix Vault.
- Borrowed alUSD is used to purchase ALCX - ETH LP and Lock AURA.
- OP Collection: 97.5% of sales are deposited as collateral into Alchemix Yearn Vault.
- Borrowed alUSD is used to purchase alETH - ETH LP and Lock VELO.
- Locked veVELO qualifies DAO for $OP Rebate, which is sold into alETH - ETH LP.
- Locked veVELO qualifies DAO for $AERO drop.
- DAO earns Weekly Bribes and Farm Yield for Initiatives while alUSD Loan repays itself.
- Create, Pitch and Launch Outreach Collections to additional partner groups.
Seeking 25 ETH Grant Funds for Development, Art, and Outreach:
- 15 ETH for DAOhaus for Development
- 5 ETH for SHIZZY for Art
- 5 ETH for Rootdraws for Art | Business Development
CONTEXT:
The OP Alchemix Treasury: [2.4M in assets]
https://debank.com/profile/0xc224bf25dcc99236f00843c7d8c4194abe8aa94a
The following assets provide a base level of liquidity for Alchemix Loans on Optimism.
- $772k veVELO [About 9.6M veVELO]
- $20k OP-alUSD LP
- $20k alETH - OP LP
- About $1.6M of OP | wETH | USDC tokens.
veVELO directs emissions of VELO to Alchemix LP pools.
The alAsset Pools allow Alchemix borrowers to exchange their borrowed funds.
Locking veVELO gives Alchemix weekly $OP Rebates:
Alchemix is now one of the Top 5 Holders of veVELO:
The Alchemix Treasury is committed to a four year veVELO lockup, to provide a foundation of liquidity for Alchemix borrowers.
veDAOs are Moloch DAOs, which allow the Alchemix community to share this responsibility, while retaining ownership of their contributions.
This proposal seeks funding to build a "multi-tenant veDAO launchpad".
- Launched veDAOs raise funds with NFT sales.
- veDAO Shares are issued to "Smart Wallets" registered to those NFTs.
- 90% of funds raised are deposited as collateral into an alETH loan.
- Borrowed alETH purchases and locks veVELO.
- veDAOs launched while the Tour de OP is active receive an $OP Rebate Grant on their locked VELO.
- Each Treasury is a Gnosis Safe, controlled by Membership Shares.
The assets of this Safe help Alchemix achieve deeper liquidity, and provide a way to engage "core speculators" of the Alchemix Community.
The launchpad provides the same opportunity to other partner groups.
Introduction to veDAOs:
The veDAO was pioneered by DAOhaus, as a community-owned LP Solution:
https://daohaus.substack.com/p/season-3-vedao-is-here-
veBAL and HAUS/ETH LP were raised and locked for one year by $HAUS Contributors.
Problems:
- Funds were Locked in Bear Market
- Expensive Mainnet Transactions
- No Bonus OP Incentives.
Whales who had been supportive moved their votes elsewhere, emissions dried up, and the veDAO contributors were slowly rugged.
Velodrome offers solutions:
- VELO is low Market Cap.
- veVELO is locked VELO, in NFT form, and is more liquid than veBAL.
- Optimism has Affordable Transactions
- Current $OP Incentives for locking VELO
- Income Stream of Weekly Bribes | Fees | Yield.
New & Improved Design:
- In Moloch v3, veDAO Shares are ERC 20 tokens.
- Using ERC 6651, “Token Bound Accounts” are registered to each NFT in the collection, allowing the NFTs to own Shares.
- Directing 90% of NFT Sales to a Treasury owned by NFT holders is disruptive.
- NFTs provide art assets for marketing
- NFTs provide a secondary market for Membership Shares.
- Alchemix Loans provide a layer of risk management, which protects the DAO while also allowing max-locked VELO.
When the underlying ETH Collateral has repayed the loan, the veDAO may vote to withdraw their initial deposit and continue to manage the veVELO, or dissolve the DAO.
EXPECTED OUTCOMES:
Alchemix Community Benefits:
veDAOs help "core speculators" work together to support the liquidity of their Tribal project.
More LP, and veVELO means:
- Attracting LP with VELO Emissions.
- Less Slippage for Large Trades
- More Trade Volume
- Filling the Aave aWETH Vault with Collateral Deposits as partners use the launchpad.
- Each DAO gets an Income Stream for initiatives.
OP Ecosystem Benefits:
Partner Protocols can take advantage of Alchemix Loans, and the Launchpad to support their own Liquidity Goals.
- Good for Velodrome.
- DAO LP and veVELO is "stickier" than Mercenary LP.
- Hedging Positions is easy with Gnosis Safe and Kwenta.
- Good for creating a more engaged OP DeFi Community.
PROJECT DESIGN:
NFT Membership and Moloch v3:
ERC-6651 allows for “Smart Wallets” to be registered to NFTs. The contracts include a registry, which connects the NFT as the "owner" of its “Token Bound Account”.
The NFTs themselves are the shareholders of the veDAO.
Some Benefits:
- Secondary NFT Markets for DAO membership are now an implicit part of Moloch DAOs.
- Existing NFT collections or New Collections can hold the shares.
- Small batch launches allow each community to raise for a specific purpose, and control membership size.
- Gamified DAO membership is possible, as well as revitalizing dead communities.
Resources:
https://eips.ethereum.org/EIPS/eip-6551
https://moloch.daohaus.fun
https://toolbox.daohaus.fun/getting-started
Role of DAOHaus in the Alchemix veDAO Launchpad:
DAOhaus has deployed Moloch v3, and has committed to moving their their headquarters to Optimism.
ERC 6651 has been deployed to Mainnet, and is possible to deploy to Optimism.
Dekan of DAOhaus solved the solution for integrating 6651 with Moloch v3, to allow NFTs to own DAO shares during the onboarding process:
https://hackmd.io/@Dekan/Bks7bcWE2
Summary:
- An administrative contract called a “Shaman”, accepts a tribute of 1 ETH to the veDAO.
- 90% of these funds go to the veDAO Treasury
- 5% of these funds go to the DAOhaus veDAO Treasury
- 5% of these funds go to Art and Development
- If a minimum tribute has been received, the Shaman mints an NFT to that account.
- The Shaman then registers a "Token Bound Account" for that NFT.
- veDAO shares are then sent to the Token Bound Account.
DAOhaus is currently seeking grant funding from Alchemix to prioritize building an Alchemix Branded “multi-tenant veDAO Launchpad”.
Most of the work remaining is frontend development.
Marketplace Considerations:
ERC 6651 adds a complexity to NFT Secondary Markets, because a check needs to be made at the time of sale, to make sure that the Token Bound Account still has claim to all of the assets represented in the sale.
Otherwise, a person could sell an NFT, but drain their share of the veDAO — scamming the buyer.
The Marketplace must:
- Check DAO shares at the time of Sale
- Stream Royalty payments to the veDAO(s) owned by the NFT.
Different Options for Building the Marketplace:
- DAOhaus could partner with Velodrome to expand their veNFT Marketplace.
- DAOhaus could work with Quix.
- DAOhaus could build a Marketplace alongside the launchpad on Alchemix.
A marketplace will be needed, though it is not included in the scope of this proposal.
In addition to grant funds, DAOhaus also receives:
- 5% of each collection sale directed to the HAUS veDAO to support HAUS liquidity.
- 3% of each collection sale directed toward an ongoing development and maintenance fund.
Shizzy Aizawa as Artist for Alchemix veDAO Collection, "Alchemistresses"
Scoopy has spoken with Shizzy, and wants her to create the Alchemix veDAO Collection.
Grant funds will also go to Shizzy so she can prioritize building out a collection.
In addition to grant funds Shizzy also receives 2% from the Alchemix veDAO Collection Sale.
Rootdraws as Biz Dev | Outreach Artist for "Optimistic Landscapes" veDAO Collection
Hello, I'm Root, and I designed, pitched, and wrote this proposal.
I'm making a pixel art landscape collections to offer to partner groups who would benefit from using the Launchpad.
- Each Partner is a tribe, who has their own "region" of landscapes.
- There are 69 NFTs in each region.
- They sell for 1 ETH Each, and 90% of that sale goes to their veDAO treasury
- The Treasury deposits into Alchemix Vaults | stakes SNX.
- Borrowed alETH | sUSD is used to buy and lock veVELO.
- veDAO benefits from OP Rebate.
- The landscapes are Twitter Banner Dimensions.
- I'm painting pixel art over Midjourney prompts to help with production speed.
Small collections allow for each community to experiment with how their organization can beneft or contribute.
As each region is released, the collection retains a coherent whole.
Partnerships:
- SERVICE PROVIDERS
- Service Providers use the Launchpad as a Product, or a Tool.
- They design campaigns and launch them to serve CLIENTS.
- They also have Treasuries for liquidity needs, or their own purposes.
- CLIENTS
- These partners have the same incentives as the Alchemix veDAO.
- Or, they could Raise Funds for Public Goods purposes.
My intention is to target one group at a time, produce a small collection for them, and invite them to use the Launchpad.
THE VEVELO LEADERBOARD:
This project was designed to coordinate Liquidity needs for the Communities of the veVELO Leaderboard, and any project looking to build LP on Velodrome. Each group has a unique reason why a launchpad would be useful to them, but the structures are similar.
- OPTIMISM
- SYNTHETIX ECOSYSTEM
- THALES
- LYRA
- KWENTA
- AELIN
- SNX
- ALCHEMIX
- VELODROME
There are 33 Protocols here:
METACARTEL:
- DAOhaus:
- Metafactory:
- Raid Guild:
NFT ARTIST CO-WORKING GROUPS:
- STREAMTIDE
- DOIN GUD:
- MANIFOLD.XYZ
- https://manifold.xyz/
- Manifold is already involved in ERC 6651, and is cited in the EIP.
- Integrating the Launchpad into Manifold Contracts would allow any artist to bootstrap a treasury with a collection.
- CANTO
OP PUBLIC GOODS:
There are a lot of communities who would benefit from this service.
Grant funding will help me prioritize creating collections to onboard these communities.
In addition to Grant Funding, I will also receive 2% from each collection as an Artist's commission.
RISK MITIGATION STRATEGIES:
Tribalism & "The Consensus Trap”:
VeDAOs combine NFTs | DAOs | DeFi, and empower those communities with control over their assets.
When funds are being raised, you want the initial shareholders to share a similar investment thesis.
In the case of Alchemix:
- $ALCX holders
- Users of the Alchemix Protocol
- Other protocols | communities who borrow alAssets
Moloch DAOs can Rage Quit -- where each share exits the DAO with their portion of assets.
However:
- veVELO must be sold on secondary markets, or borrowed against to liquidation.
- Staked LP must be unstaked.
- Borrowed alETH must be repaid first.
Each veDAO constrains itself to achieve an objective.
Governance Coordination is needed to modify that objective, or dissolve the group.
"The Consensus Trap" means that there is some directional momentum in the beginning of these DAOs, which will require member coordination to change.
If the members cannot coordinate, then the treasury will continue unchanged.
Along the way, there are income streams:
- Weekly Bribes
- Yield / Fees from LP
- Group Ventures or Speculation
- Loan Repayment from Collateral Appreciation
- Royalties from people selling Membership NFTs
Each share will have a claim to these income streams, or a vote to how they are managed.
The DAOs are likely to coordinate toward their purpose until they agree that it is more profitable for them to dissolve.
PRACTICAL APPLICATIONS:
veVELO Emissions and LP DAO: [ALCHEMIX veDAO]
- Sell out a small NFT collection to the Alchemix Tribe at 1 ETH per Tribute.
- 90% of the ETH goes into the treasury, and then gets deposited as collateral to borrow alETH.
- The alETH is used to buy and max lock veVELO.
- The Locked veVELO offers a 20% $OP Rebate from the Tour de OP Velodrome Grant.
- The OP Rebate is sold half for alUSD, and then the OP - alUSD LP is staked to farm VELO.
Now, you have a self-repaying loan, weekly bribes, trade fees, and farm yield — as well as a secondary NFT market for entering and exiting the DAO.
Strategies:
Each week, the veDAO has a choice of where to vote with their veVELO — or, they can set up an automated voting strategy.
Loyalists:
Voting for Alchemix Pools will give them fees on those pools, but Alchemix will need to give bribes to Velodrome.
These bribes can be matched by Velodrome, and will flow back into the main Alchemix Treasury, and act as "bribe airdrops" for the veDAO.
Bribe Maximalists:
Voting for the most profitable bribe each week lets the DAO dump those tokens to build a position or LP of their choice.
An automated compounding bribe tool is being developed by velodrome.
Bribes could be compounded into alETH pools, or dumped and used to market buy $ALCX -- it would depend on what a group of profit driven Alchemix Supporters would want to do with weekly bribes.
SNX Weekly Degens [THALES | KWENTA veDAO]
Synthetix Projects work better staking SNX than taking alETH loans, especially with upcoming Synthetix v3.
Each of the members of the Synthetix Ecosystem also uses velodrome as their primary AMM.
- Bribes could be used for weekly Sports Betting on Overtime Markets.
- Kwenta and Lyra could have Perps and Options Education DAOs.
- They could create a Moloch Hedge veDAO.
- Trading Competitions are another possibility.
The use cases are great -- but there is no immediate benefit to Alchemix, unless the Synthetix veDAOs wanted to borrow alETH for a specific purpose.
There is an additional responsibility here, for SNX stakers, since Alchemix Loans cannot be liquidated.
Synthetix recently increased their Debt Ratio to 5:1, which also means that the size of the sUSD loans would be smaller, but liquidation is still a possibility.
Arts and Education Incubator [MetaFactory veDAO]
Art cooperatives add a lot of value to the Launchpad.
In the case of MetaFactory, they have liquidity needs for their $ROBOT token, but they also have a whole business structure that could be easily integrated into using the Launchpad to bootstrap treasuries for Clients.
MetaFactory earns a percentage, the artists earn a percentage, and the Clients get Tribe Members with cool shirts, who also own DAO shares.
This adds a deeper financial layer to brand marketing.
BUDGET & IMPLEMENTATION:
A lot of this project is already completed:
- Moloch v3 is deployed.
- ERC 6651 can be deployed.
- Dekan already put together that Proof of Concept Onboarder.
- DAOhaus is already working on the frontend.
- Shizzy is already dreaming up Alchemistresses
- Root is already working on Landscapes, and doing outreach.
Grants are needed now to prioritize this work.
- 15 ETH to DAOhaus Team:
- Priority focus on an Alchemix Integrated Frontend
- 5 ETH to SHIZZY
- Dedicated time making art for the Alchemix veDAO collection.
- 5 ETH to ROOTDRAWS
- Dedicated time making art for the Optimistic Landscapes, and inviting partners to use the Launchpad.
Sales from each collection:
- 90% of Sales go to veDAO
- 5% of Sales go to HAUS veDAO to build HAUS Liquidity
- 3% of Sales go to DAOhaus Development Fund
- 2% of Sales go to the Artist
TIMELINE:
Weekly OP Rebate Grant ends July 24th.
However, Velodrome is applying for another OP Grant. Here is the review for the performance of their last grant:
The OP rebates are a valuable incentive, and any veDAO that launches while the grant is active will gain an advantage.
CLOSING QUESTIONS:
Where do you see the product going over the next 12 months?
- Communities who build these veDAOs now, will have their Alchemix and Synthetix Loans repaid by the market.
- Communities that use the launchpad will have deeper liquidity.
- Communities will execute strategies, play games, share education, do Hackathons and Competitions, or Socialize.
- Funding will be secured to build a Marketplace focused on exchanging Membership NFTs, capturing royalties and directing them back to DAO Treasuries, implementing some gamification about Shares and Loot.
- Artist Cooperatives will use the Launchpad as a Service to their Clients, allowing the Launchpad to scale.
On a multi-year timeline, many of these veDAOs will use Kwenta to hedge their LPs against market volatility.
.:.
How are you building it vs other attempts at similar initiatives?
Redacted Cartel captures bribes and turns them into a vaulted yield product.
Financially, veDAOs are LP Cooperatives, that serve existing communities. One could be built for Redacted.
Moloch v3 also means members are in control of assets | votes | agendas | outcomes -- provided they can coordinate.
veDAOs are a Governance Game, not a vault strategy.
Both focus on community fundraising, and can involve NFTs in participation.
veDAO NFTs use ERC 6651, which is new, and allows the NFTs to own the Membership Shares, not just signify whitelist status.
veDAO Treasuries are built on top of Gnosis Safe, which means there is a management component once the Treasuries exist -- Aelin is more about the initial raise.
I'd like to solve a way to offer Aelin these DAOs to integrate into their product.
The llamas is another similarly structured project, built on Curve, but their funds are in a Multi-Sig, and it is more of a product, whereas this Launchpad is more of a service.
Meaning, if you don't like Llamas, or you are not using Curve -- then their product is not for you.
Our Launchpad is more of a toolset, which means it can benefit multiple communities, or be applied in unique ways.
.:.
Where is the most exciting experimentation in this happening currently? Which projects? What inspires you here?
Benefits to a THALES veDAO:
- Pixel Art landscapes can be used as assets in their game.
- THALES can have two veDAOs, one for Overtime and one for Parimutuels.
- Both veDAOS use their veVELO to deepen THALES LP.
- Parimutuel Bribes are used by the veDAO for risk free speculation on high return, high risk binary options.
- Overtime Bribes can be used to bet on Sports Events, while the community hangs out in the discord together and watches the game.
- Their initial deposit into SNX likely appreciates, cause SNX v3 is bullish.
- Their speculative activity is risk balanced, for high rewards, but if they lose, there's always next week.
- Wins are compounded into LP.
That's a cool system, made possible by these veDAOs, and I'm curious to see if it works.
Each group has its own goals, and unique structure which appeal to the members of that group. And those are the kind of art projects that will use the Launchpad.
I would enjoy contributing to artist cooperatives who were all executing projects like that.
.:.
Is this a passion project? Or are the intentions to try to build something into a long term project?
This is a tool which solves a major problem for me:
- "Why should these people care about my art?"
When Mucha painted women -- they were beautiful, but they were also painted on bottles of wine, or rolling tobacco Ads.
People care about Pleasure | Investments | Communities | Values and Ideology.
Art becomes Marketing, or ideological propaganda, or in this case, a Wrapper for a Fundraising Coordination Service.
There are a lot of communities that can benefit from a Fundraising Coordination Service, and I'm interested in building a career in DeFI.
I'm giving this my full time labor, because I have conviction in the underlying tools and premises.
.:.
Please vote to approve this proposal, and contribute by offering feedback or insight on how to improve.
Thank you very much for your attention.
VOTING:
Voting is single-choice.
A choice of “Approval” accepts the distribution of the grant funds.
A choice of “Disapproval” rejects the distribution of grant funds, and calls for a discussion and a new proposal on a different path forward.
Abstain.
