Summary: OlympusDAO is continually trying to broaden its treasury exposure to strategic assets. An acquisition of Convex would help OlympusDAO gain significant exposure and governance power over the Curve ecosystem. Convex has built a moat with Curve by commoditizing Curve Boost and acquiring considerable control over the protocol versus auto-compounding by selling CRV.

Curve: Curve Finance is the largest DeFi protocol by Total Value Locked and has proven itself as one of the most critical primitives by offering low-slippage stable asset trading through an Automated Market Maker (AMM) market setup. This was achieved when Curve Finance introduced the stableswap invariant which allowed the protocol to concentrate liquidity around a specific price and greatly minimize slippage. At the time of writing this proposal, Curve’s daily volume was $267,940,432 and has a total amount of deposits at $19,957,126,755, including factory pools.

The high-level purposes of the CRV token are to incentivize liquidity providers in the Curve Finance ecosystem as well as getting as many members involved as possible in the governance of the protocol.

Convex: Convex is designed to create a collaborative relationship between Curve liquidity providers and yield-focused CRV investors. In this relationship Curve liquidity providers earn boosted rewards from their positions by indirectly staking their LP tokens in the Curve gauge system through Convex. Locked-in CRV investors provide the veCRV necessary to deliver the boost, and in return they share in the excess return generated by liquidity providers.

CVX is the governance token behind Convex. The token is issued to LPs that stake through Convex and all cvxCRV holders. Additionally, CVX is rewarded to LPs on DEXs that offer cvxCRV/CRV trading as a reward. These incentives are crucial to ensure that CRV stakers are able to access liquid markets and able to sell cvxCRV.

Abstract: To acquire the liquidity rails needed for Olympus to become the most widely used currency of DeFi, external liquidity measures will need to be utilized; Olympus cannot and should not incentivize every pair with OHM bonds. By acquiring CVX however, we can divert rewards to our desired gauges in the future.

There are significant benefits in acquiring CVX over CRV:

The CVX emission schedule is based on the CRV locked within the protocol, with a cap of 100 million tokens once 500 million CRV has been locked. Assuming CVX reaches this goal, the number of CRV per CVX will only rise as it acquires more CRV. At the time of this proposal, there is 135,823,707 cvxCRV (CRV locked in CVX), and 19,635,344 CVX locked, meaning every locked CVX has ~7 CRV of governance power.. Convex currently sees a rate of $68m worth of CRV locked on a monthly basis into the protocol. Since the CVX:CRV price ratio is only ~5.5x, it is more advantageous to acquire CVX over CRV. It is also imperative to start sooner than later, as the emission schedule will significantly reduce over time as Convex acquires more CRV tokens. While we do acquire CVX via our treasury allocation, we feel that the rate in which we acquire them is too small, and needs to increase significantly.

Motivation: Olympus aims to be the decentralized central bank of DeFi. The acquisition of governance tokens for large DeFi protocols such as the Curve Finance ecosystem allows us to more efficiently reach this goal.

Other: If approved, we will target 10% of the RFV, subject to change based on policy decisions. Risk analysis below.

Proposal: Add CVX bonds.

Should we add CVX bonds?

This poll has ended.

    Absolutely, Curve is significantly more important than getting basic 2LPs imho. LFG.

    if Brian say yes, ofc I'm in

    j/k

    if it's not us, it'll be someone else

    Generally in favor.

    This expands the opportunities available to other products in the Olympus ecosystem — giving the DAO more flexibility and the potential for more partnerships. You've nailed the narrative aspect, which I also agree with.

    Huge untapped markets, future liquidity provision for Olympus

    Also incoooooom

    Do it

    Yes. This is the perfect complement to our Tokemak strategy. It's time to have a larger voice in how liquidity flows.

    Yes!.. and thank you for the excellent and detailed proposal!

    Without a doubt in support!

    CRV (and CVX) are going to be a very valuable asset in the long term. Definitely something we'd like for our treasury. Absolutely in favor. Great write-up Json and Brian.

      MrMochi Thank you! I'd just like to say that the policy team also did a lot of work in data collection and analyzing the token risks, they should also be commended!

        json

        json I don’t even need to read this to know this is a yes. Convex was going to be my play before I found Ohm.

            json I agree, CVX is a crucial defi asset and needs to be added

              As Brain's number one simp I tend to agree with everything written in this before even reading it😂

              But to be real this is a no-brainer!

              and kudos to Json and Brian for this well-written proposal ❣

                Vehemently yes. Staking a claim in Curve governance through Convex is the natural progression for Olympus' long-term goals. Incredibly limited downside and infinite upside. This is one of the most strategic assets we could add to the treasury. Awesome job Brian and Json.

                NBS Thank you 🙂 , but to be clear, multiple policy members worked on this; I don't think its fair to them to say it was only us, its a collective effort.

                  Fully support. The sooner we start acquiring CVX, the better given multiple other protocols have begun discussions to do the same. Votium payouts have been mooning and this is only expected to continue given the efficiency of protocol's bribing vs. LM incentives with the additional tailwind of Curve v2 which will add a theoretically unlimited amount of additional pools to bribe.

                  This is the most obvious move the protocol could have taken, and I'm just curious why this wasn't proposed weeks ago? Feels like a pretty big oversight to wait until every other protocols wants to start acquiring CVX before we start to talk about putting out bonds. Is there some form of bureaucracy standing in the way? How can we make this process more efficient moving forward?

                  In case it's not obvious, I vote "yes".