Wintermute DeFi Governance Digest: February 2024 | Week 3

21 FEB 2024 | RESEARCH

This week’s proposals include Yearn Finance launching yPools, GMX potentially listing new assets, and Karpatkey spinning off from GnosisDAO to create their own DAO; along with votes from Aave denying the integration of Oval, ApeCoinDAO choosing Arbitrum for their ApeChain, and Uniswap ratifying their cross-chain growth package.

Proposals

Yearn Finance (YFI)

Proposal: Launch yPools

Author: 0xPickles

Summary: This proposal requests to generalise the design of the yETH protocol and allow for the creation of new, self-governing pools for various assets, called yPools.

Key Points:

• yETH is a self-governing pool representing a mix of ETH LSTs.


• As of now, yETH has been running smoothly for six months and has amassed $19.3M in TVL.


• Given its success, this proposal requests to extend such a model to other yield-generating assets, allowing users to benefit from diversified exposure.

• yPools will be:

–> Self-governing: yPool token holders can stake their yPool tokens to control the protocol in its entirety.

–> Immutable: yPools are not upgradeable.

–> Trust-minimized: No third party should be able to access funds or alter the state of the protocol.

–> Autonomous: Critical operation of yPools should not rely on third parties.

• In general, yPool assets should generate real yield, report yield on-chain regularly, be redeemable for the underlying assets through the protocol directly, be non-rebasing, and be permissionless.


• Yearn will be able to capture a 5-20% performance fee on all yPools (set by the deployer of the yPool).

Our Take: Yearn’s generalization of yETH will allow anyone to easily provide diversified access to yield-bearing assets.

GMX (GMX)

Proposal: New Potential GM Listings – Q1 2024

Author: Coinflipcanda

Summary: This proposal outlines a list of available tokens for future listings on GMX V2, including ATOM, NEAR, MATIC, OP, AAVE, and AVAX.

Key Points:

• Coinflipcanda has provided a list of new Oracle feeds that have completed testing and are now available on Chainlink’s Data Streams’ Arbitrum deployment.


• These streams have also been reviewed by Chaos Labs who have provided technical recommendations for their initial listing parameters.

• The list of new tokens available to be listed are:

–> AVAX – can be listed as a synthetic market or via Wormhole bridged AVAX.

–> MATIC – can be listed as a synthetic market, Wormhole bridged MATIC or Arbitrum canonical bridged MATIC.

–> ATOM – can be listed as a synthetic market or via Axelar bridged stATOM (or ATOM).

–> OP – can be listed as a synthetic market.

–> NEAR – can be listed as a synthetic market or directly via the native Near bridge.

–> AAVE – can be listed using the canonical token via the Arbitrum bridge.

• The community will have the final decision as to which asset to list.

Our Take: It’s great to see GMX increase its market offerings. Each of the proposed assets receives a lot of daily trading volume and OI across major CEXs. Listing these tokens should have a material impact on GMX’s trading volume and fee generation.

Gnosis DAO (GNO)

Proposal: GIP-92: Should Gnosis DAO spin-off karpatkey DAO and deploy the KPK Token?

Author: Karpatkey

Summary: After years of active DAO treasury management for the GnosisDAO, Karpatkey is requesting to spin off and launch their own DAO with a KPK governance token.

Key Points:

• Karpatkey has provided DAO treasury management to the GnosisDAO since November 2021.


• In their 3 years of active DAO treasury management, Karpatkey has become a market leader, providing on-chain and non-custodial asset management to various DAO treasuries such as Balancer, GnosisDAO, ENS, CoW, Lido, and Aave; amassing $1.2B in AUM.


• Now after validating product-market fit, Karpatkey intends to launch its own DAO spinoff from the GnosisDAO (similar to CoW DAo and SafeDAO) and issue a governance token.

• Karpatkey will aim to provide financial services to the leaders in each DeFi category, creating network effects and robustness for their users, and the DeFi ecosystem as a whole.


• KPK will be the native token of the KarpatkeyDAO and will act to align all parties that actively contribute to the delivery of Karpatkey’s mission.


• KPK will be responsible for defining Karpatkey’s treasury parameters, budgets, OTC deals, buybacks, and M&A deals.


• The full supply will be 1M KPK and non-transferable for the foreseeable future.


• GnosisDAO will receive 2.5% of the total supply as a result of a $1M investment with a valuation of $50M. Furthermore, GNO token holders will receive a future airdrop.

Our Take: Karpatkey has excelled in actively managing DAO’s treasuries while utilizing DeFi to its full extent. This is a great opportunity for them to continue to grow and spearhead large-scale DeFi asset management.

Votes

Aave (AAVE)

Proposal: [TEMP CHECK] Integrate Oval for the BAL & SNX Ethereum V3 Markets

Status: Finished.

Created: Feb 15, 2024.

Ends: Feb 18, 2024.

Leading Consensus: NAY – 429k AAVE (64.78% of total votes).

Summary: This proposal requested to begin exploring the integration of Oval – an Oracle Extractable Value protocol by UMA for BAL and SNX markets on Aave Ethereum V3. By integrating Oval, Aave would be able to capture a % of liquidation revenue that is lost to liquidation-MEV activity.

ApeCoin (APE)

Proposal: ApeChain: ApeChain: Selection of proponent to build ApeChain

Status: Finished.

Created: Feb 2, 2024.

Ends: Feb 15, 2024.

Leading Consensus: Arbitrum – 25M APE (50.35% of total votes).

Summary: This vote ratified the selection of Arbitrum Orbit technology as the underlying infrastructure for ApeChain. ApeChain is a dedicated ApeCoin blockchain that scales APE and supports the growth of the ApeCoin ecosystem. The vote received submissions from Arbitrum, Polygon, A-Team, and zkSync.

Uniswap (UNI)

Proposal: Uniswap Revitalization and Growth Proposal

Status: Live.

Created: Feb 17, 2024.

Ends: Feb 24, 2024.

Leading Consensus: For – 2.5M UNI (100% of total votes).

Summary: This proposal ratifies the Uniswap Revitalization and Growth Proposals, approving incentive packages for various chains with Uni V3 deployments. The successful chains and their respective UNI incentive packages are: Linea – $250k, Scroll – $250k, Polygon zkEVM – $250k, zkSync – $500k, Blast – $500k, Base – $500k, BSC – $1M, Mantle – $250k.