Add CRV rewards on a gauge for SDT/WETH pool

Summary:
Proposal to add the SDT/WETH pool to the Gauge controller to enable users to assign a gauge weight and mint CRV.

References/Useful links:
Website: https://stakedao.org/
Documentation: Introduction - Stake DAO
Github Page: https://github.com/StakeDAO
Communities: - Twitter: https://twitter.com/StakeDAOHQ - Discord: Stake DAO - Telegram: Telegram: Contact @StakedaoHQ

Protocol Description:
Stake DAO is a non-custodial platform built on top of decentralized protocols that enables anyone to easily grow their crypto portfolio. The TVL of the protocol is above 775M$, spread out across chains where the Curve ecosystem is already present (Ethereum, Polygon, Avalanche, Harmony and BSC), and non EVM chain like Solana, Elrond, Livepeer. It is planning to add more chains in the future.

Describe the proposed asset(s), the corresponding protocol(s), and historic prices of the token (price must come from the source of highest liquidity).

Motivation:
The DAO is in the process of migrating its full liquidity from Uniswap and Sushiswap to Curve, and added initial liquidity on the pool for 1.2M$ (600K$ SDT/600K$ WETH). It will soon add extra SDT incentives to get more volume on the pool. It targets to reach a minimum of $20m liquidity and has voted to invest a share of its performance fees to support the increase of this liquidity. The vote can be found here: Snapshot

Explain why this pool needs incentivization

A gauge that earns CRV would boost the liquidity of the pool, allowing for higher volumes in the pool and fees for veCRV holders. Stake DAO will also help accelerate the locking of CRV thanks to its new product, the Liquid Lockers, designed to provide value to CRV holders and to Curve as a DAO.

Users depositing into liquid lockers will receive sdTokens that can be deposited into a reward contract to receive several sources of yield, and keep their voting power, or deposit them in the upcoming liquidity pools. You can find more info on this new product currently being built in this medium post: Introducing Liquid Lockers & veSDT | by Stake DAO | Feb, 2022 | Medium

The tokenomics of SDT are also changing toward a veSDT model, and will be used to boost the voting power obtained by users locking in Stake DAO’s liquid lockers (thus incentivising for more CRV locking).

Specifications:

Please answer in a short and clear manner.

  1. Governance: Provide current information on the protocol’s governance structure. Provide links to any admin and/or multisig addresses, and describe the powers afforded to these addresses. If there are plans to change the governance system in the future, please explain.

The governance of Stake DAO is currently off-chain using Snapshot. The multisig address is: 0xf930ebbd05ef8b25b1797b9b2109ddc9b0d43063
Any decision regarding SDT inflation, liquidity, partnership or DAO treasury goes through a DAO vote, and then it’s executed by the multisig.

The protocol will switch to on-chain inflation once veSDT goes live, and on-chain governance will come at a later stage.

  1. Oracles: Does the protocol rely on external oracles? If so, provide details about the oracles and their implementation in the protocol.

No external oracles.

  1. Audits: Provide links to audit reports and any relevant details about security practices.

No external audits on the current stack which is based on audited contracts from other protocols. The new product (Liquid Lockers) and veSDT architecture is currently in the process of being audited.

  1. Centralization vectors: Is there any component of the protocol that has centralization vectors? E.g. if only 1 dev manages the project, that is a centralized vector. If price oracles need to be updated by a bot, that is a centralized vector. If liquidations are done by the protocol, that is also a centralization vector.

Incentives updated manually each week according to a voted formula, until the veSDT is live. Once veSDT is live, inflation allocation will be voted on-chain so fully decentralized, while total inflation will be updated on a daily basis thanks to a bot applying a public formula depending on onchain metrics. All strategy management will be decentralised thanks to a “Harvest fee” allowing any user to call the earn and harvest functions in exchange for a share of the performance fees.

  1. Market History: Has the asset observed severe volatility? In the case of stablecoins, has it depegged? In the case of an unpegged asset, have there been extreme price change events in the past? Provide specific information about the Curve pool: how long has it been active, TVL, historical volume?

Except for the listing where the volatility was extremely high, the SDT price has been in a range between 1$ and 4.5$ for the past 9 months, experiencing relatively low volatility: 154% annualised volatility over the past three months, compared to 147% for CRV.

The SDT/WETH factory pool has been active for two weeks and was seeded with 1.2M$ by the DAO.
TVL : 1.4M$
Daily volume: 35K$ (due to current migration, and Sushi and Uniswap pools still being live; average daily trading volume is generally sitting between $250k and $500k).

Voting options:
For: SDT/WETH should have a gauge that earn CRV
Against: SDT/WETH shouldn’t have a gauge that earn CRV
Abstain

The proposal on chain and the gauge are not deployed yet, this post is to measure the community sentiment for adding reward on this gauge.

Should the SDT/WETH pool have a gauge that earn CRV ?
  • Yes
  • No
  • Abstain

0 voters

7 Likes

Don’t see why not: more gauge, more volume, more fees, LFG!

2 Likes

n.b. there’s still ~$1.5m sdt/eth on sushi and uni yet to migrate to the Curve pool.

gauge, sdt, and ‘other’ incentives will help to further bootstrap the pool and volumes.

ref:

sushi - $1.47 | SDT | SushiSwap Analytics

uni - Uniswap Info

2 Likes

More utility for SDT. Great.

1 Like

Definitely in favor ! Good proposal for both Curve and StakeDao ecosystem.

4 Likes

I fully agree with this proposal which goes in the right direction for both protocols.
Good job !

2 Likes

This is an easy one to support. Since its inception, StakeDAO has been a consistent supporter and member of the Curve ecosystem.

3 Likes