Olympus receives a “premium” via the work GSR does for the protocol.
This proposal is a win-win.
Also I’m shocked at those who think there is some principal we are violating by wanting to be on a CEX.
Market Making Proposal from GSR
I'm generally weary of market makers, having worked with several that were weasels. Regardless, I have heard good things about GSR. In spirit, I support this proposal. However, some further thought belows:
- I would be inclined to charge an interest rate for the OHM loan. Even if only nominal, as a show of good faith.
- Should GSR decide to return the OHM at the end of 12 months, what is the plan for it? Will it be staked at that time? Will it be divided up against other current liquidity pools? Will GSR have an option to extend the term of the loan?
I think the forward buy out rates are fair, and at the end of the day, more liquidity is good for the protocol. I trust the team to have assessed the quality of GSR appropriately.
I am kind of new to this so I am wondering what prevents people from borrowing OHM and then just staking it?
davoice321 1. How does this agreement, and push to facilitate trading of OHM at CEXs, fit within Olympus' mandate to become the reserve currency of DeFi?
this!
davoice321 Why should Olympus enter into this agreement as opposed to simply letting market makers and CEXs gather inventory on their own to market make and provide liquidity to CEXs?
well said
gsr_nyc they will help expend your community in unexpected ways
"Your community" ? why would I trust anyone to act in this communities best interest when they don't even consider themselves as part of it?
Iceman This is one of the most bullish and positive things for Ohm rn.
a very bad take. Most bullish and positive thing for ohm is to keep building, growing as a community and helping their partners grow along the way, not giving free loans some tradFi firm to help people speculate on things they don't understand. remember 3, 3 ?
biscuit I also don't understand why a centralized exchange listing would increase DEX volume
because as soon as they inject the liquidity in CEX's they will also set up arb. bots and make the real money by buying from cexes and selling it on dexes and vice versa...
bone They’ll help onboarding people.
they will not be onboarding anyone. They will be providing new toys to speculators. I don't agree that people buying a coin on a CEX because it's cool and hyped by some influencers is actually a person who we need rn… That stage will come but at this point in time I think the people we need are those who are actually interested in reading, learning and contributing…
Maven11 We had a several conversations with Olympus
Who is Olympus exactly?
Maven11 new investors that are not acquainted with the DEXes and/or are not tech savvy enough to go through the process of acquiring it
Sad to see an OG ohmie having a mind that didn't evolve since 2018.
it is and has always been our job as a community to educate people who are joining crypto about the values of which this space has been built upon. Providing a way for new investors that doesn't have a metamask and don't know what DEX is (which is quite primitive tech at this point in time) to get their hands on ohm (a protocol they don't understand, don't know the problems it solves and has really high risk) is irresponsible even if we were to profit heavily from it. That should not be the culture we are trying to build and not the behaviour we should promote. Wanna bring new people? Use some of your "seed" investment profits to build an education platform instead, we ohmies can take the dump for you to build that platform.
Ulysses31 It just seems so counter to everything we are trying to build with Olympus and DeFi in general
Thank you
Ulysses31 Crypto is an educational journey as much as anything and the "doing in DeFi" is a critical piece to understanding why there is so much value in being an Ohmie.
very well said!
Wartull Any market maker can just OTC this same amount easily today and list on an exchange where we don't have any say in the matter
what say do we exactly have in this matter?
In general I have a couple of comments after reading through every message.
First of all I want to say I am quite disappointed by how some people in the team are trying really hard to push this through while most people haven't even heard who GSR is and what they do. I am having a lot of backroom deal vibes and makes me question the motives and the integrity of those members.
I do not get the argument "we have idle money in treasury and it's ok to use it that way". If the best thing you can think of doing with that money is to loan it "interest free" to a corp to make more money for themselves while bringing (imho.) no value, you have bigger problems than not having liquidity on CEX's. if they want to be a market maker they are free to do so with their own money. There are enough incentives for them to do so without us giving them free money.
I do not like the look or the smell of it. and I don't understand what benefit it brings to us as a community. This feels like a step backwards while we've been pushing hard for decentralisation. I understand some of you do not care about this stuff, maybe you are new, maybe you do not have reason to care but it's about time for you to learn because you will need it.
For those who got excited to dump their profits on people in cexes that has no bloody idea what Olympus does, I say greed is the enemy of the soul and your soul is what you need to work on as you move up in the hiararchy. Otherwise you won't make it as a human being.
as you may have guessed this is a big no from me.
In follow-up to my previous post: If this proposal does pass, and the ETH repayment option I suggested removing is retained, the amount of ETH to be repaid should be specified at the time of the loan, rather than being calculated at market value at the time of repayment. As another comment noted, we should not be in the business of handing-out zero risk options with no discernable benefit to the Olympus protocol.
gsr_nyc "The current Olympus community is about 10,000 strong." - Where did you get this data from? I believe this is an understatement. 80k Ohmies shown in Dune dashboard, 56k Ohmies in the Discord. For reference, see: https://dune.xyz/shadow/Olympus-(OHM)
Everything about this proposal is iffy. I'd ask myself why OG Ohmies are now trying to shove down our throats a CEX listing when since day 1 Olympus has been of the opinion that a CEX can simply acquire OHM freely on the market.
I voted no, and to be honest this makes me very sad for the protocol's future. Seems people forgot their principles.
How can I vote no twice
Wartull That is what the community of Ohmies is debating now. There is no guarantees that by them getting a risk free loan of OHM that they will follow through. We saw this with the whole LOBI deal.
Other entities that would like to attach themselves to OHM are doing so to ride the coat tails of OHM. Nobody in here would ever get a risk free zero interest loan nor if you were a billionaire would you give one out.
I agree with others that asked who all you guys have talked with to make you come to the conclusion that GSR is the best fit. Also @Maven11 stated that they had been used on various other projects in the past with no mention of what or the outcomes of said deals.
GSR should come in here and make the case for why this is beneficial as well. Right now most of us in here see no benefit outside of a little publicity from a press release stating GSR and OHM work a deal to provide liquidity to X.
The community here has been supportive of a ton of the measures put forth by the Olympus team. The most common point used by the team to persuade us is that we have 700-800 Million worth of OHM sitting idle making us nothing so why not. But I along with many others are finding it real hard to see the benefit of spending 15 million on this GSR deal vs maybe using the same amount of cash to Market OHM to the world. To me a better risk vs reward outcome spending it on marketing or investing into expanding our team to grow.
I feel like we are moving too fast if we try to go for a CEX listing. We just launched the Proteus program (phase 1), lets at least see it through first and consider if we really need to CEX listing. At the same time an interest-free loan with no collateral? I am not knocking GSR, they seem to be a great MM to deal with. But this is business, is the DAO registered as a legal entity anywhere? For example in the US, Wyoming seems to be the only state that accepts DAO's as a legal entity. So we could register and build out a legal framework then hire a legal firm through the DAO. There just seem to be many loopholes in this proposal for us to even look move forward with it.
@gsr_nyc You seem to be great, but I vote NO.
h0botnic4 sorry my typo, I meant 100,000 strong indeed
Now, according to Dune, there are slightly over 4m DeFi users, and about 400k sushi users but Coinbase alone for instance has over 70m registered users.
As OHM gets listed, the right trading environment will be a catalyst for those people to get interested and get involved.
https://dune.xyz/rchen8/defi-users-over-time
I didn't see what GSR is paying to borrow the OHM. Can that shared?
biscuit
1. the loan is to be used to create liquidity, it will not be staked
2. if the price moves on a centralized exchange, then arbitragers will either sell it so it is back in line or match that move on DEX, leading to increased volume there and as a result visibility.
3. that depends on the exchange and how they engage with Olympus DAO, but we expect most exchanges might want to list without necessarily asking the community, especially once volume increases. To be clear as many commenters seem to think GSR is pushing for centralized listings, this is not our mandate, what we want is when those listings happen (like Gate.io did for instance) for it to be a constructive experience for the token holders and the new potential investors. There should be a tight bid-offer and size on both sides of the market, so one can decide to get involved with confidence.
4. we are integrated with over 50 exchanges where we would be active if and when the exchanges decide to list OHM, most of them would be exactly who you think: Binance, Coinbase, Huobi, OKEx, KuCoin, Gate.io, Gemini…
- Edited
As a top holder who has accumulated every dip and will continue to do so…and have NEVER sold because I believe Olympus is going 100x from here, I will vote for this proposal because the pros far outweigh the cons in my analysis.
We need the CEXs for the next phase of Olympus' growth. In addition, we need to think in terms of the opportunity cost of delaying this effort. Proteus and this initiative are very complementary and the time is NOW.
Having said that, I do agree that a community call-in Discord with the GSR team is needed as the next step.
On the surface this seems like a win-win proposal subject to further diligence. Increased visibility for the project (which will be critical in achieving the goal of becoming a reserve currency), if they don't stake, then they don't participate in the growth - and their call options are way out of the money.
It is mind boggling how many of you are so vehemently against a CEX listing. A CEX is obviously a great onboarding mechanism to let non crypto natives, and non bridgooors who are priced out of eth, learn the ropes and slowly dip their toes into the defi waters. In earlier replies GSR has given concrete numbers on how many users a CEX like coinbase has vs a DEX like sushi has. A CEX listing is also a quantifiable net positive for our POL. A lot of you are also worried about people buying on a CEX are getting diluted due to the large APY. DAO members have already stated they are working on staking solutions for CEX's (maybe read all the posts before you make your takes). Will the CEX take a cut of the staking rewards if you stake on their exchange? almost certainly. Don't like that? withdraw your OHM and stake on the native app. The pro's clearly outweigh the cons here.
Having slept on this, I can understand where the core team is coming from in terms of a CEX listing being inevitable at some point. Being decentralized as we are, we can't stop someone doing whatever they want with their OHM.
Therefore either:
A) we partner with someone and try and have some influence over the CEX listing, or
B) have it listed by a CEX with no input.
Obviously A is the better outcome here. So in accepting this, I have some other questions for the core team:
- Mechanics -- OHM, sOHM or wsOHM? If we list OHM would we not be setting the stage for a liquidity bucket needing to be continually topped up as purchasers of OHM go (3,3) either via a CEX native staking solution or moving to Olympus native? @gsr_nyc would be interested in your thoughts on this to. Daniele Sesta made an interesting argument for wsOHM to be the currency of choice being traded Ina recent Avalanche house talk. "An interest bearing reserve currency"….kind of liked this idea.
- Economics of deal -- GSR are receiving free loan, and free options here in return for providing liquidity, upon which they will profit, for supporting an OHM listing(s). Olympus gets improved liqiuidity and visibility. Obviously from reading the above many Ohmies are feeling that these terms are not favourable, myself included. My company is a market maker in Aussie interest rate futures. Our desk runs at at a Sharpe of 14+ and made 50m profit last year (favourable mkt conditions to be fair). Point is, MM is a very profitable business, so paying interest on a loan shouldn't be a deal breaker here. These deal terms should be economically favourable for the DAO treasury as well and such a deal would likely appease many Ohmies.
- Would like to know more on the legal issues Ohmies have rightly expressed concern about above, in the forthcoming AMA. Does Olympus have legal council appointed here for contract negotiation and reviews?
Given a CEX listing is inevitable at some point, I think our community needs to consider this deal, debate it, come up with solutions on how best to implement/manage it. Let's not move too quickly and give ourselves enough time to consider the implications.
All in all, this is a very interesting debate and one that could bring about many changes to how DAOs in general operate.
- Edited
I have a question about trading fees. Whilst fees are not currently our primary source of treasury income, the 'protocol owned liquidity' model is all about capturing value generated by liquidity and storing it / using it to generate more value. Are we expecting the sushi ohm/dai pool volume to increase as a result of this deal and what % of the total increase in volume on CEXs would we estimate to see routed to our pools? If the team has done some modelling on this perhaps you could share the results? @Wartull @Zeus
KO-XD i was trying to figure out some of the potential pifalls. Appreciate this write up!
Relying on niche governments that allow for some kind of DAO representation is a time waster. Governments change laws daily and crypto was designed to not follow their rules, but rather the rules of math and cryptography. There is not inevitability about government representation, Ethereum alone contains all the tools to conduct this agreement using smart contracts + multisigs/oracles.
It is appreciated that you would like to offer your services to decrease the bid-ask spread. But the meat and potatoes of this conversation is that you would like 25k OHM to do so, profiting off of the fees from trading. If the DAO were simply to wait for other CEX's to list we could keep 25k OHM in our treasury while also getting listed on a CEX…
Agree, OHM benefits from a CEX listing. I think focusing on some kind of exchange for the OHM liquidity is of most peoples concern, on top of the scariness of doing business with a centralized MM as a DAO. Being that Olympus is a DAO, lots of concerns as to who and how deals are conducted with treasury assets matters here.
A solution to risk of the seizure of the lent OHM would be using a smart contract to conduct the deal between Olympus DAO and GSR. We could also clearly codify the terms in to which the OHM is to be returned and what interest rate they are borrowing it at. Through a combination of smart contracts + multisigs/oracles + DAO voting we can easily come up with a solution that best meets both OlympusDAO and GSR.
I think OHM definitely benefits from being listed on a CEX. Less experienced crypto users having easy access to (3, 3) is a good thing. But it is very necessary that the CEX's listing OHM acquire it fairly. Giving 25k OHM to GSR when they admit OHM will be listed eventually makes no sense.
The only benefit to the DAO is immediate exposure to CEX users now rather then when CEX's list naturally.
Ask any ohmer if they think 25k OHM is a big or small amount of OHM…
There are legal/government jurisdictions in which we can get some form of enforcement, but they are few and far between and laws change daily.
Smart contracts allow for clear terms to be laid out between Olympus DAO and GSR such that the entire OHM community can read them. The enforcement that would prevent them from screwing us could be written into the contract and enforced via DAO + multisigs/oracles.
I think you are not taking enough consideration into the fact that GSR will be receiving the trading fees as there is no protocol owned LP involved. There is assymetry in what we would be giving GSR for what they stand to offer. They even mention that OHM will eventually be listed on a CEX eventually. Why give them the 25k OHM if being listed is only a matter of time?
Very good points fren.
Why do a deal now if CEX listing is only a matter of time? You refuse to acknowledge the real risks in GSR not following through 100% on their end of the deal. WE HAVE NO WAY TO HOLD THEM ACCOUNTABLE IF THEY DECIDE TO NOT FOLLOW THE DEAL! Also the extra liquidity would be a liability not an asset because we are giving GSR the trading fees and the 25k OHM…
This proposal is not by any definition a win win. GSR receives trading fees and we give them 25k OHM. We get listed on a CEX earlier than we would have and normie exposure which would have come eventually.
Agree with this fully. Proteus just launched on Avalanche. Not even live on Matic, Fantom, Solana, etc. Why not bide our time…
There is no interest rate. Its free 