Proposals

Ribbon Finance (RBN)

Proposal: RGP-33: Merge Ribbon Finance into Aevo

Author: Chudnov

Summary: This proposal requests to merge Ribbon Finance into Aevo to build out a DeFi super-app that offers perpetuals, options, and yield products under the same roof.

Key Points:

• Ribbon Finance was developed two years ago and was the first and largest Decentralized Options Vault (DOV) protocol that reached an all-time high of $300M USD TVL.
• However, limitations such as gas fees, latency, liquidity, and capital efficiency, on Ethereum Mainnet pushed the team to develop Aevo.

• Aevo is a derivatives-focused L2 roll-up built using the Optimism stack, offering options and perpetuals trading through a CLOB with low gas fees and low latency.
• In just 3 months, Aevo Exchange has achieved over $150M of cumulative trading volume, including highs of over $10M in 24H volume and $10M in open interest.
• In order to make Aevo the best place for on-chain derivatives, this proposal requests to combine Ribbon and Aevo. If successful, Aevo would begin offering Ribbon’s structured products including both passive (vaults) and active products.

The merge will require 2 changes:

• All components of Ribbon Finance will adopt the Aevo brand (i.e., user interface, communication channels, governance, and visual design elements).
• The winding down of Ribbonomics and enabling $RBN holders (and lockers) to migrate to $AEVO, a yet-to-be-launched token on ETH Mainnet that governs the Aevo protocol and chain.

Specifically, on the token side:

• $RBN holders can migrate to $AEVO at a 1:1 exchange rate.
• $RBN emissions are set to 0 across all vaults.
• veRBN lockers will be unlocked without any penalty.
• Vault revenue sharing with veRBN lockers will be stopped.
• 1,000,000,000 $AEVO will be minted at launch (equal to the total supply of $RBN).
• Token distribution will remain the same amongst the team, investors, and treasury.
• All major investors and team members have agreed to re-vest their unvested tokens for another year.

Our Take: Unifying both products under Aevo is a great move for the team, but more importantly offering Ribbon’s structured products in a cheaper and faster environment for users will be extremely important for continued adoption.

Celo (CELO)

Proposal: cLabs Proposal for Celo to transition to an Ethereum L2

Author: Matt

Summary: This proposal requests to transition Celo from an independent EVM-compatible Layer 1 blockchain to an Ethereum Layer 2 with decentralized sequencers and an off-chain data availability layer powered by EigenLayer and EigenDA.

Key Points:

• cLabs is proposing to transition Celo from an independent EVM-compatible Layer 1 blockchain to an Ethereum Layer 2 built on the OP Stack.
• The new Celo Ethereum L2 will include:
• Decentralized sequencers powered by Celo’s existing validator set.
• Off-chain data availability powered by EigenLayer and EigenDA.
• A design that retains Celo’s 1-block finality.
• The migration to an L2 is expected to further align Celo with Ethereum through improved EVM compatibility, stronger security assurances, and a trustless bridge to Ethereum, simplifying liquidity sharing between Celo and Ethereum.

• From a user/community perspective, there will be no changes to existing dApps, mobile-first features, or the growing regenerative finance stack.
• While Celo has always been EVM-compatible, considerable work is needed on the backend to ensure that tooling and libraries maintain composability. By migrating to an L2 using the OP Stack, there will be no more need to monitor such compatibility issues.
• Celo currently has 110 validators securing the chain with ~300M in locked CELO. A successful migration will transition these validators to decentralized sequencers, making Celo one of the first decentralized sequencer L2s with 1-block finality.
• By utilizing off-chain data availability through EigenDA, Celo will be able to offer cheaper transaction costs in comparison to Optimism and zkSync which opt for on-chain data availability.
• Importantly, $CELO will retain its core functionality as a governance tool for the Celo blockchain, controlling core contracts and the validator/sequencer set.
• $CELO will continue to be used for gas payments on the new L2.

Our Take: With L2s such as Optimism and Arbitrum continuing to climb in TVL rankings and usage, there is a clear advantage to adopting architecture that directly inherits properties from Ethereum Mainnet. This is a great opportunity for Celo and we look forward to watching their growth.

Balancer (BAL)

Proposal: [RFC] Adjust Protocol Fee Split

Author: Solarcurve

Summary: This proposal requests to adjust Balancer’s protocol fee split by reducing the share of revenue to the DAO’s treasury to 17.5% from 35% and increasing veBAL fee capture.

Key Points:

• At the launch of veBAL, 50% of swap fees were collected by the protocol and distributed as 75% to veBAL holders and 25% to the treasury.
• With BIP-19 this changed and 75% of swap fees earned by the protocol were redirected to bribing core pools on L1 and L2s. Therefore, reducing the fee share for veBAL holders as they only directly earnt swap fees from non-core pools.

• Core pools are liquidity pools that contain at least 50% of a yield-generating token, which Balancer earns a fee on (e.g., wstETH/wETH)
• BIP-161 adjusted the fee split again due to a concern in the runway for the DAO and set the protocol fee split to 65%/35% veBAL/DAO Treasury.
• Fast-forward to today, there has been a reduction in the effectiveness of using swap fees as bribes, veBAL wrappers do not benefit from the core pool mechanic, and the treasury has an ample supply of stablecoins for the next couple of years.
• Therefore, this proposal requests to introduce a new split to boost Balancer to address such issues.

Specifically,

• L1/L2 core pools: 50% bribes (voting incentives), 32.5% to veBAL holders, and 17.5% to the DAO treasury.
• L1 non-core pools: 82.5% to veBAL holders and 17.5% to the DAO treasury.

Our Take: Balancer has shown the effectiveness of utilizing protocol income to fund various growth activities and ensure sufficient runway. This new protocol fee split will make veBAL more attractive for BAL lockers and could potentially see a larger % of the supply locked.

Votes

Aave (AAVE)

Proposal One: [ARFC] Aave V3 Deployment on BNB Chain

Status: Finished.

Created: July 13, 2023.

Ends: July 16, 2023.

Leading Consensus: YAE — 530k AAVE (99.99% of total votes).

Summary: This proposal requests the deployment of Aave V3 on BNB Chain. If approved, the deployment will allow CAKE, BNB, BTCB, WETH, USDC, and USDT as collateral.

Proposal Two: GHO Mainnet Launch

Status: Finished.

Created: July 11, 2023.

Ends: July 14, 2023.

Leading Consensus: YAE — 881k AAVE (100% of total votes).

Summary: This proposal ratifies the launch of GHO on Ethereum Mainnet. GHO will launch with 2 facilitators: Aave V3 Ethereum Pool Facilitators — allowing depositors to borrow GHO against their collateral, and the FlashMinter — allowing free flash loans of GHO to help protect its peg. The initial debt ceiling is set at 100M GHO with a borrow rate of 1.5%.

Arbitrum (ARB)

Proposal: Accelerating Arbitrum — leveraging Camelot as an ecosystem hub to support native builders

Status: Live.

Created: July 15, 2023.

Ends: July 22, 2023.

Leading Consensus: Against — 21M ARB (54.43% of total votes).

Summary: Camelot DAO is requesting 1.5M ARB per month for the next 6 months to fund liquidity incentives for Arbitrum-focused projects on Camelot. The program will focus on attracting liquidity from major DeFi protocols, increasing the liquidity of core pairs (ETH, USDC, ARB) and focus on improving LSD diversity on Arbitrum.

MakerDAO (MKR)

Proposal: BlockTower Andromeda Upgrade, Smart Burn Engine Deployment, Keeper Job Updates, Scope Defined Parameter Changes, Delegate Compensation, Ecosystem Actor and Core Unit Funding Updates, Spark Protocol Proxy Spell Execution

Status: Finished.

Created: July 14, 2023.

Ends: July 16, 2023.

Leading Consensus: For — 88,881 MKR (100% of total votes).

Summary: This executive vote ratifies a myriad of changes for MakerDAO including a multi-swap PSM router for BlockTower Andromeda transactions, deployment of the new Smart Burn Engine, a Dai Savings rate reduction to 3.19% from 3.49%, stability fee and liquidation ratio reductions for various ETH and WBTC vaults, the offboarding of CRVV1ETHSTETH-A vault, and the freezing of sDAI on Spark protocol.