Policy report, October 2021

The Olympus protocol treasury and protocol owned liquidity are rapidly expanding. Runway at the current reward rate has been increasing and is currently over 400 days. There is a continuous high demand for bonds and, with a runway of over 365 days, bond capacity has increasingly been directed to liquidity and non-pegged assets.

Reward rate: 0.2975%

The policy team continues to recommend that the reward rate remain at 0.2975%. The policy team sees no market indicators that would prompt a recommendation that it be changed. Note however, that even though bond revenues are significantly extending the runway, at this time we do not intend to recommend the community deviate from the reward rate framework codified in OIP-18. 

Total daily bond capacity is currently over $12M. In the period there have been community votes to add OHM-wETH and WBTC bonds. OHM-wETH bonds are already active and WBTC will go live as soon as the smart contracts are deployed and activated. 

Strategic Policy Considerations

Although much of the policy team’s focus is on day-to-day tactical decisions related to OHM’s current and future status, our actions are informed by key strategic imperatives. These include engaging in activities that help boost OHM’s status as a decentralized censorship-resistant long-term reserve currency, supporting OHM’s market stability in the face of an ever-changing macro and micro crypto environment, and working to ensure OHM’s assets are being used in ways that drive maximum value for OHM’s holders/stakers. In future monthly reports we will touch on how our decision-making is influenced by these strategic considerations. 

Links to more information and further discussion
Live Policy Dashboard
#policy channel on Discord
Proposals section in the Forum
OIP 32 - Reform Bond Capacities
OIP-35: Add wETH to risk free free value of treasury assets
OIP-36: Add WBTC to the Treasury
OIP-37: Launch OHM-ETH Liquidity bonds

Ongoing forum discussions and votes
OIP-40: Increase ETH allocation target to 33% of Treasury RFV

a month later

Policy Report for November 2021

Overview

Over the last month, the Policy team has carefully reviewed market conditions and has been reducing overall bond capacity in light of our stable market cap. Market cap stability has allowed liquidity to catch up and the Policy team has focused this liquidity on the OHM-ETH pair.

This strategy of tightening capacity has had a minor impact on the overall runway, which now stands at about 380 days. The DAI bond capacity is currently being increased to stabilize the runway.

In addition, the Policy team has been working in conjunction with the Treasury team to implement long term strategies that increase non-bond revenues in order to support protocol operations and positively impact the runway. Upcoming reports will show revenue generated by liquidity provision and other revenue generating activities.

Current Reward Rate: 0.298%

The policy team continues to recommend that the reward rate remain at 0.298% in line with the OIP-18 framework.

Bonds Capacities

Over the month of November, the treasury has accumulated an additional $266M (at current price) of assets through its bonding program. Total daily bond capacity is currently at $6.6M. The last month has also seen community votes to add OHM-wETH and WBTC bonds. OHM-wETH bonds are live and $118M has been bonded so far. WBTC will go live as soon as the smart contracts are deployed and activated.

Strategic Policy Considerations
Over the month of November, the Policy team discussed the following issues:

  • Maintaining the balance of Treasury assets utilized to back/mint OHM and continuing to favor assets that are crypto native and highly decentralized/censorship resistant

  • Acquiring and leveraging strategic assets, which has begun with CVX bonds

  • Communicating Olympus’ overall strategy, especially as the focus moves from bootstrapping (high APY), to revenue generation and long-term protocol sustainability

  • Addressing the specific steps being taken to make Olympus’ DeFi’s reserve currency, and how to communicate this activity and the evolving strategy to our community

In addition, from a strategic perspective, it is Policy’s intention to:

  1. Expand Olympus’ current (conservative) strategy of minting OHM using stablecoins with the addition of non-pegged assets. This is to provide greater flexibility in how treasury stablecoins are deployed for yield as well as relying less on the acquisition of stablecoins to extend the runway. We are currently working on proposals related to this strategy.

  2. Implement strategies that enable Olympus to increase the contribution of non-bond revenue to protocol operations and sustainability

Links to more information, further discussion and new proposals
Live Policy Dune Dashboard
#policy channel on Discord

New proposals in the Forum
OIP-41 - Launch Olympus Incubator program
OIP-42: Insurance coverage for smart contracts - rewards distribution
OIP-43: Launch CVX Bonds
OIP-44 Implement Lobis as a governance arm of OlympusDAO
OIP-45: Proteus
OIP46 - Implement [REDACTED] as an Olympus Branch
OIP-47: Olympus Stopgap Budget Proposal
OIP-47A: Amendment to Olympus Stopgap Budget Proposal
OIP 48: Additional DAO Swap with Tokemak
OIP-49A: Olympus Give Lighthouse Partnership with Gitcoin (Amendment)
OIP-50: How the DAO Should Handle Charitable Donations
OIP 51: Strategic Asset Whitelist
OIP 52: Add UST to the Treasury
OIP-53: Execute DAO swap with Frax Finance
OIP-54: Stablecoin Farming Amendment
OIP-55 - Olympus Grants Program

Ongoing forum discussions
Market Making Proposal from GSR

Ongoing snapshot votes
OIP-50: Ban charitable donations using DAO controlled funds
OIP-52: Add UST to the Treasury
OIP-53: Execute DAO swap with Frax
OIP-54: Stablecoin Farming Amendment

a month later

Policy Report for December 2021

Key Policy Notes

  • The policy team has introduced OIP-56: v2 of the OlympusDAO Policy Framework. The framework focuses on how the Policy team’s activities will be impacted by v2 bonds and other key topics. OIP-56 is currently being voted on by the community.

  • OIP-63 was approved and the Policy team is currently implementing a reward rate reduction in line with the approval vote.

  • The runway has remained stable and is currently at 374 days.

Bond Capacities

During December, the Policy team:

  • Kept overall bond capacity tighter in response to overall market conditions

  • Turned off CVX bonds because Olympus has accumulated 1% of CVX’s current supply

  • Opened up bonds with capacity shifted to FRAX and OHM-FRAX as the v2 migration progressed

Strategic Policy Considerations
Over the month of December, the Policy team discussed the following issues:

  • Continued  work with the Treasury team to implement long term strategies that increase non-bond revenues in order to support protocol operations and increase  runway.

  • Continued acquisition and leveraging of strategic assets, such as CVX bonds

  • Moved toward a communications framework to illustrate Olympus’ overall strategy

  • Development of metrics that illustrate how Olympus’ is progressing in its journey toward becoming DeFi’s reserve currency

Links to more information, further discussion, ongoing and completed proposals

Live Policy Dashboard
#policy channel on Discord

Snapshot votes initiated in December:

OIP-60: Hire a market maker
OIP-62A: Liquidity proposal
OIP-63: Reward rate adjustment
OIP:64: Partnership with Umani Finance
OIP-65: Partnership with DebtDAO

OIP-66: EXODIA x OlympusDAO OTC for Seeding gOHM on BeethovenX on Fantom

a month later

Policy Report for January 2022

Key Policy Notes

  • The Policy team implemented a reward rate reduction in line with OIP-63

  • OIP-76, “Create Inverse Bond Policy Lever,” was introduced and passed, which added an additional tool for the Policy team: inverse bonds. These bonds will allow OHM holders to sell their OHM at a premium, without affecting the market price and  simultaneously increasing backing per OHM

  • Implemented v2 bonds, which allow for the purchase of bonds that vest in pre-defined periods and pay out in staked OHM (e.g., 14 days)

  • The runway has increased due to the reward rate adjustment and is currently 647 days

During January, the Policy team:

  • Continued to monitor overall market conditions, and prioritized reserve bonds to maintain RFV

  • Introduced OIP-56, which updated the Policy Framework to v2 in light of v2 bonds; OIP-56 was approved by the community

Bond Capacities

Strategic Policy Considerations
Over the month of January the Policy team discussed the following issues:

  • Worked with the Treasury team to consider the optimal utilization of concentrated liquidity to drive additional LP fees and enhance OHM stability

  • Made significant contributions to the development of the Olympus12 Action Plan, which is helping to improve external understanding of the DAO’s activities and internal alignment around key goals

  • Continued to develop a metric, the Olympus Impact Factor, that illustrates how Olympus is progressing in its journey toward becoming DeFi’s reserve currency

Links to more information, further discussion, ongoing and completed policy-related proposals
Live Policy Dashboard

#policy channel on Discord

Policy-related Snapshot votes initiated in January:

OIP-76: Create Inverse Bond Policy Lever
OIP-56: Policy Framework v2
OIP-62A: Liquidity Proposal
OIP-69 : Whitelisting of “Thecosomata.sol” as an “OHMDEBTOR”**

a month later
abipup unlocked the discussion .

Policy Report for February 2022

Key Policy Notes

  • The Policy team focused on refining implementation of v2 bonds, including optimizing the bond vesting schedule

  • In accordance with OIP-76, “Create Inverse Bond Policy Lever,” the Policy team worked to test and implement the inverse bonds infrastructure so that it is ready to deploy if needed

  • The runway has largely remained steady month over month and is currently at 624 days

  • The team continued to focus on the implementation of a concentrated liquidity strategy to optimize OHM trading towards better fee generation and stability

Bond Capacities

During February, the Policy team:

  • Thoroughly analyzed and discussed aspects of the Policy team’s bond approach including a comparison of current discounts to vesting-adjusted v1 discounts, capital availability for bonds, and an analysis of the impact of rebases on LP positions

  • Continued to monitor overall market conditions, and implemented a mix of liquidity and reserve bonds, as appropriate

  • Migrated certain liquidity positions to Uniswap v3 (OHM-FRAX) and developed a smart contract-based strategy to streamline further migrations into concentrated Uniswap v3 liquidity positions

  • Focused on clarifying the definition of backing to aid implementation of inverse bonds; specifically providing the community with information about liquid backing per OHM versus total backing, which is utilized to conduct market activities such as liquidity provision, swaps and other activities

Strategic Policy Considerations

Over the month of February the Policy team focused on the following strategic issues:

  • Helped to clarify and refine the strategy outlined in the bonds-first white paper, which was presented as a RFC to the community (Link)

  • Continued to develop a metric, the Olympus Impact Factor, that illustrates how Olympus is progressing in its journey toward becoming DeFi’s reserve currency

  • Engaged in preliminary conversations about the best strategy for moving toward on-chain governance of key Olympus activities

  • Began discussions about the shape and scope of a Olympus quarterly report (informed by the OIF metric) and highlighting alignment of activities with the Olympus12 Action Plan

Links to more information, further discussion, ongoing and completed policy-related proposals

Policy-related Snapshot votes initiated in February:

OIP-79: Approve FIAT DAO as an OHMDEBTOR
OIP-80 Tender Offer Framework**

abipup locked the discussion .
a month later

Policy Report for March 2022

Key Policy Notes

  • The Policy team focused on refining implementation of v2 bonds, including optimizing the weekly LP bonds capacities to better track OHM’s supply growth

  • The team looked into various on-chain governance models and started defining implementation specifications

  • The runway has slightly declined month over month and is currently at 558 days

Bond Capacities

During March, the Policy team: 

  • Performed thorough analysis to understand the impact of bonds type and capacities in a context where external demand for OHM has remained low for multiple weeks now. As seen on the above table, Policy has concluded that LP bonds were most favorable to stabilize Olympus’ market capitalization at the moment.

  • Started collecting on-chain governance best practices by collecting and comparing multiple different approaches that have been adopted in the ecosystem. The team is also looking into documenting all of the potential attack vectors opened up by an implementation of on-chain governance. Details and specifications are still being ironed out going into April. 

  • Continued evaluating best strategies in regards to Protocol-Owned Liquidity. 100% of the OHM-FRAX pool was migrated to a concentrated Uniswap V3 pool. A balancer pool was also funded with OHM, ETH & DAI. A proposal to fund a Curve V2 pool was passed. Some liquidity is expected to be migrated to this new pool in April.

Strategic Policy Considerations

  • Clarify & Refine OHM Debtor function specifications 

  • Continue to develop a metric, the Olympus Impact Factor, that illustrates how Olympus is progressing in its journey toward becoming DeFi’s reserve currency 

  • Finalize discussions about the shape and scope of a Olympus quarterly report (informed by the OIF metric) and highlighting alignment of activities with the Olympus12 Action Plan 

  • Assess strategic deployment of POL into current & upcoming DEXes 


Links to more information, further discussion, ongoing and completed policy-related proposals
Live Policy Dashboard

#policy channel on Discord
Policy-related Snapshot votes initiated in March:
OIP- 83: Curve V2 Liquidity Deployment

OIP-86: Uniswap Migration Proposal

OIP- 51A: Strategic Asset whitelist- Amendment 

OIP-84: Add Strategic Liquidity Pairs to the Treasury

a month later
abipup unlocked the discussion .
a month later
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5 months later

I can’t join the discord, I have a couple of questions, when will Olympus pay 111? As far as I know before, the rate is 3:3 ( APY=(1+reward yield) * 1095

It is raised to the power of 1095 because the rebase happens 3 times a day. Consider that there are 365 days in a year, this will give a rebase frequency of 365 * 3 = 1095.

Accordingly, I have a question, when will he pay? waiting for your answer and invitation to discord

4 months later
shadow unstickied the discussion .
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