• Proposal

  • OIP-27: Activate OHM reactor with Tokemak

Summary: Execute a token swap of OHM and TOKE with Tokemak to activate an OHM reactor leading into their C.O.R.E event, which will run for one week- starting 28th September. This proposal will only go into effect if Olympus is among the Top-5 protocols that receive the most votes at the end of the event. This OHM reactor and swap will help establish ties between both protocols and allow both parties to explore more ways of combining our unique infrastructures, diversify treasuries, and provide governance power within each other’s protocols.

Background: Olympus has over 170M USD in POL as of writing, with over 150M million USD in the OHM-DAI pool alone. The protocol currently owns ~ 99.9% of this liquidity and therefore routes that liquidity. Our policy team predominately handles this process by executing these internal decisions voted upon by our community per the Policy Framework, as outlined in OIP-22.

Tokemak currently has ~ 400M USD in TVL across their Genesis pools, with their PCA reserve also holding a combined 30M USD in both ETH and USDC. Each reactor serves as an isolated pair of assets with the option for single-sided liquidity provision on both sides of the pair. When providing liquidity on either side of a reactor, protocols, and users will receive weekly TOKE emissions. In the event of IL, Tokemak would draw liquidity from its PCA reserve to rebalance the specific reactor that has suffered the loss to make LPs whole again.

Abstract: Olympus has pioneered the concept of POL via Bonds, and Tokemak is attempting to solve for market-making within Defi through its novel liquidity routing infrastructure. Olympus views Tokemak as an essential infrastructure piece to; democratize liquidity provision, strengthen OHM liquidity pairs across different exchanges, accumulate TOKE to supplement OHM bond emissions. This swap allows Tokemak to use the OHM as an operational reserve to spin up an OHM reactor, and in return, Olympus will receive a USD equivalent worth of TOKE to become a powerful liquidity director. The 3M USD of OHM as a reserve would be paired with 3M USD of ETH in order to source an initial 18M USD worth of liquidity (9M USD of OHM + equivalent 9M USD of ETH) for the OHM reactor. The OHM used for the swap will come out of the DAO holdings (1.3% of our total OHM holdings).

Motivation: Establish a bond between both protocols in order to explore more ways Olympus and Tokemak can better leverage their unique infrastructures.

Intended Utilisation: Olympus will use the TOKE from the swap to direct OHM liquidity in the tOHM reactor. The additional TOKE earned whilst directing liquidity in the OHM reactor will function as a policy, treasury, and partnerships lever to potentially reduce bond emissions and reduce slippage across OHM pairs.

Specification:

  • Execution at the current 30-day moving average with no price discount.
  • OHM 30-Day MA= $493.50
  • TOKE 30-Day MA= $35.08
  • $3,000,000 in notional value, paid in OHM and TOKE
  • 6,079 OHM <> 85,518 TOKE

For: Execute swap with Tokemak for OHM reactor ignition- dependant upon C.O.R.E voting results.

Against: Do not execute swap with Tokemak regardless of C.O.R.E voting results.

Poll

OHM is currently number one in the vote with 1.3M+ Tokemak votes.

Seems like both communities are aligned. Let’s do this!

OHM Tokemak Pilots, can't wait to see a custom gundam.

I missed the degensis event for Tokemak, OT screaming at me to join. I was GAHHH when I finally did my homework. Huge fan of this. A unique way for Olympus to explore where it can go in the Defi universe and a huge value add for the holders of OHM (Deeper liquidity for future OHM pairings and Treasury diversification with an accumulation of TOKE). I implore people to buy some TOKE and vote for OHM to get a reactor. Truly an experiment with very little downside.

Hoping Tokemak starts using Olympus Pro so they can stop paying heavy emissions for my LPed ass 😉

I'd say we should do it. There are clear benefits for both of the protocols.

my only prerequisite would be to execute the swap only when both parties agree to stake and they can't sell the tokens without governance vote(like the sushiswap proposal). If we could write a smart contract that ensures this agreement that'd be even more awesome. (maybe an idea for olympus pro +)

I also think that such agreement between 2 parties should be the case for each DAO swap.

Pair this with an Olympus Pro partnership with TOKE, and we're pretty much golden.

Great opportunity to take a leading role as the first reactor on what could be a monumental protocol for the future of DeFi. In addition to the OHM specific reactor, OlympusDAO could also establish a strong position in future Bridge Reactors which could help OHM become the reserve currency of choice across L1s and L2s.

I've been doing some serious research on Tokemak recently for a crypto research platform and from my understanding the initial token swap that would occur should the Ohmies vote to go through with the reactor establishment would provide OlympusPro with serious LD powers (liquidity director). The reactor would make most sense for the DAO to contribute to from the OHM side as the Ohmies are best served staking as we have, however, if you're also a TOKE holder, the reactor would give extra influence on where OHM's liquidity laser beam is pointed.

Overall great opportunity and you've got my vote. I hope the rest of the community agrees. Feel free to shoot over any questions about the potential relationship and I'll see if I can answer. (3, 3)!!!

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