Support Fiat DAO by providing liquidity on their Balancer FDT-ETH pool.
Background: Earlier this year, Olympus formalized a partnership with Fiat DAO through OIP-72. As a result, a DAO swap was conducted between the two projects, making Olympus one of Fiat DAO’s top holders.
Initially, Fiat used its OHM holdings to bolster liquidity for its FDT token by pairing with (g)OHM but encountered significant routing issues for multiple months, to the point where they finally moved their main liquidity pool to an FDT-ETH pair on Balancer.
Policy acknowledges that the infrastructure for partners to utilize OHM to provide liquidity is not perfectly in place today. Mint & Sync, Flex Loans, and Balancer boosted poolsare solutions that are currently being worked on and which Policy believes will greatly improve the attractiveness of OHM as a counter-asset for partner tokens.
In the meantime, as a show of good faith, Policy wishes to utilize a small fraction of its ETH resources to support a partner that has been closely aligned with Olympus since launching. This would increase the size of the FDT-ETH liquidity pool by $120k, which is a 55% increase in the pool size.
A specific benefit to Olympus providing this critical liquidity is that staking the liquidity token will generate significant rewards APY via the Balancer liquidity mining program (currently 100 - 300%, though slightly lower if we were to provide liquidity).
In strengthening our alignment, we hope that once we improve the infrastructure to use OHM as a counter asset, FIAT DAO will reconsider moving its main liquidity pool to an OHM-denominated pair. This will be revisited at a later date.
Become a liquidity provider on FDT-ETH Balancer pool by utilizing:
5.3M FDT, acquired through the DAO Swap and subsequently staking on FIAT DAO. An additional 5M is currently vesting.
20% of the amount in 1) in ETH. As of today, this would represent using around $24 000 worth of ETH.
Policy to reassess this position once suitable solutions for pairing with OHM are made available to partners.