• Proposal
  • OIP-110: Add BAL & AURA tokens to the strategic assets whitelist

Summary: Whitelist BAL & Aura tokens as strategic assets to be acquired by OlympusDAO to gain influence over the Balancer ecosystem.

Motivation: As outlined by OIP-103, Olympus aims to use Balancer as its main liquidity hub in the near future. Acquiring governance power in that ecosystem would allow OlympusDAO to:

  • Participate in & Influence key Balancer governance decisions

  • Incentivize external protocols to pair with OHM

  • Generate additional returns on POL

With Mint & Sync ready to be turned on and Olympus Flex about to launch, OlympusDAO is actively looking for ways to offer the most attractive package to protocols looking to establish liquidity for their token and Policy believes that the ability to control and direct $BAL emissions is another great tool to have in the toolbox.

Strategic Focus

After multiple months of discussing and collaborating with the Balancer team, OlympusDAO is confident that the Balancer DEX will keep innovating on the DEX front and continue shipping new features that will appeal to many protocols in the space.

Today, 145,000 $BAL tokens are emitted weekly, of which, 90% are allocated to the various liquidity pools within Balancer. This represents $47M worth of incentives to be distributed to liquidity providers annually and which are currently being governed by veBAL/Aura holders.

Governance power in the balancer ecosystem can be acquired through multiple different tokens, however Policy proposes to only focus on $BAL and $AURA as means of governance acquisition. Given that Treasury wants to maximize veBAL controlled/ $ spent, it should be agnostic and acquire the most efficient token.

Proposal:

  • Olympus to acquire governance power through $BAL (veBAL) and/or $AURA

  • Tokens to be acquired through direct market buys and/or Bribes and/or POL farming

Add BAL & AURA to the strategic assets whitelist

This poll has ended.
  • json replied to this.

    balotelli45 This will unlock deeper value proposition to partners and the growing OHM ecosystem, totally in favor. I suggest we also put into place a framework for reward distribution as well? (e.g. % of voting weight given to approved pools)

    Strikes me that this is adding to the flywheel within an important strategic partner so makes alot of sense. Thank you for the write up, am generally in support.

    Is there a consensus on where $BAL (veBAL)/ AURA would fall within the Treasury Asset Evaluation Framework in terms of % caps/range of Treasury Assets?

      Thank you. Olympus thru Ohm ideally should carry its influence wherever Ohm goes. The idea that Ohm isn't just here or there arbitrarily or trivially should be a plus in the minds of investors and anyone looking to utilize Olympus and Ohm, there by shortening and clarifying the decision making process.

      2 concerns:

      1. US sanctioned Tornado Cash associated addresses and (defi) fedFi is turning to adherence it seems. 🤮 Hearing that Olympus has created/is creating a legal entity supporting Olympus - I suppose there is no other option available for Olympus but to also follow the sanctions? If yes, then all investments Olympus does must also be confirmed to follow sanctions, or they pose legal risk to Olympus and investment value drop to zero. This basically goes for all Olympus assets - in this case now - will Balancer/Aura also follow sanction regulations?
      2. Balancer has a mere 250 MUSD market cap. Not exactly a prime asset from investment perspective - even though we may like both the team and their service. I would caution against diversification of focus and capital. Olympus already is still too complicated, and the more knicks are added, the more difficult it will be to understand Olympus. Market investors dont like muddiness. If Balancer is really awesome, then why not go big and do a full M&A instead of just an energy consuming nibble?

      2 concerns:

      1. US sanctioned Tornado Cash associated addresses and (defi) fedFi is turning to adherence it seems. 🤮 Hearing that Olympus has created/is creating a Swiss legal entity for Olympus - I suppose there is no other option available for Olympus but to also follow the sanctions? If yes, then all investments Olympus does must also be confirmed to follow sanctions, or they pose legal risk to Olympus and investment value drop to zero. This basically goes for all Olympus assets - in this case now - will Balancer/Aura also follow sanction regulations?

      2. Balancer has a mere 250 MUSD market cap. Not exactly a prime asset from investment perspective - even though we may like both the team and their service. I would caution against diversification of focus and capital. Olympus already is still too complicated, and the more knicks are added, the more difficult it will be to understand Olympus. Market investors dont like muddiness. If Balancer is really awesome, then why not go big and do a full M&A instead of just an energy consuming nibble?

        Exciting. Strategically accumulating veBAL voting power through vlAURA or veBAL directly will help Olympus bootstrap its own pools and partner pools over time & become a bigger force in DeFi than it already is.

        bubbidubb

        Responding to point 2: The purpose of this proposal is to add BAL and AURA to a strategic asset whitelist, which doesn't make it strictly an "investment" (in the sense that it should/will increase in value). Per OIP-51, which introduced the strategic asset whitelist, the whitelist will consist of assets that "help Olympus strengthen its prevalence throughout DeFi [… The assets allow] Olympus to significantly increase our passive revenue generation, acquire governance power and increase the diversification of treasury assets."

        Both veBAL and vlAURA, which are the two assets this proposal pertains to, are fee-generating and allow Olympus to direct and influence BAL incentives and Balancer governance at a large scale. Seeing this is Olympus' choice of DEX as per OIP-103, it is easy to argue that Olympus should itself grow its influence on the venue which it hosts a "majority of Olympus’ Protocol Owned Liquidity in an OHM-DAI-ETH pool" or else it won't be able to cast votes that represent the DAO's best interests.

        Per OIP-51:

        "Strategic investments will only be used to purchase what we call utility assets. These are assets that we intend to keep as long as they help Olympus by providing:

        • Additional partnerships opportunities

        • Increased influence on liquidity direction

        • Governance power in key protocols

        • Better yield opportunities for our Reserve assets

        • Diversification in market value of treasury."

        veBAL and vlAURA accomplish almost all points in the list shared above.

        wollemiPine We are working on putting out a new framework strictly for Strategic Assets that will better define guidelines and maximum allocations to strategic assets as an asset class.

        In the event that this new framework is not approved by Ohmies, a clear acquisition plan for Balancer governance power will be presented to the community.

        bubbidubb As @0xLamentations mentioned, the main goal of whitelisting these two assets is because we believe they could be great tools to help Olympus bootstrap ohm-denominated liquidity.

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