Introducing Fundraising via Emissions: The Fundraising Gauge
Authors: fiddy, AliG, curve.mktcap.eth (Curve), skellet0r (Curve), big_tech_sux (Vyper Team)
Abstract
This is a signalling proposal, introducing the newly developed fundraising gauge. The fundraising gauge enables funding-seekers to raise funds via CRV emissions, enabling more efficient funding models & adding on the Curve Grants framework. If passed, the next step is an on-chain DAO Ownership vote round for the gauge to receive CRV emissions.
Summary
Currently, Curve DAO utilises the Curve Ecosystem & Community Grants Program to fund projects that improve the broader Curve Ecosystem. These funds are raised thru the grants governance process under the leadership of the Community Council. Funds raised are vested over a minimum of one year, fixed-length, fixed funding rate, and capped funding paid out from the Treasury.
While this has worked well, we propose a “no vesting & variable rate” funding model that doesn’t reduce Treasury Reserves — instead, the funding is enabled by a CRV Gauge through the gauge voting system. We believe this will allow a more robust grants ecosystem, supporting R&D and other DAO-approved endeavours more efficiently.
Proposal
Add a new gauge type for Fundraising via CRV inflation. The New Fundraising Gauge will be used to raise funds with no vesting & variable rate. The funding rate will be dependent on veCRV voters allocating gauge weight at each epoch. Funding will be capped for managing overspend. Emissions above the cap will behave akin to a CRV supply burn.
Github Implementation: veFunder Github Repository
Deployment Addresses:
FundraisingGaugeV1: 0xCED78da2c749236309774d7415236B7090B3bF27
GaugeFactoryV1: 0x696B5D296a8AeF7482B726FCf0616E32fe72A53d
Scenario:
If voted in by the DAO, a fundraising gauge with a max emission of 10,000,000 CRV will receive 0 emissions unless the DAO further assigns gauge-weight votes. If the gauge gets few votes, emissions dripped into the gauge will have a lower rate. If it obtains a larger gauge weight in an epoch, the CRV minter will mint a larger amount of CRV; regardless, the fundraising gauge caps emissions at the pre-defined maximum of 10,000,000 CRV. Any residual CRV that the gauge gets via inflation will not be minted: note that this is akin to a CRV supply burn.
Note: This is an existing model concerning killed gauges. Any gauge votes to killed gauges result in unminted CRV that is taken out of supply.
Benefits
- Unlocks our gauge’s broader potential by using CRV emissions beyond incentivising LPs.
- By tapping in the CRV inflation, this method allows us to raise funds without reducing the funds from the Treasury.
- More agile, can be tweaked on the go through vote weights. If veCRV holders feel dissatisfied with progress after granting, they can change their gauge vote to reduce emissions received or even kill the gauge.
Considerations
- Malicious funding-seekers could bribe veCRV holders to vote for a fundraising gauge. veCRV holders should be diligent with which gauges they vote in; if bribed, the bribe value should be equal in value to the maximum CRV the receiver will receive), otherwise, the DAO would be giving away free CRV.
- Any emissions directed towards the gauge beyond max emissions will reduce CRV supply. This mechanism already exists with killed gauges: if veCRV holders vote for killed gauges, the assigned inflation (while being accounted for from the total supply) is never realised.
- Current intentions are to maintain epoch-to-epoch funding with limited scrutiny. The community may choose to organise a funding oversight committee should the need arise.
Next Steps
A DAO vote to explicitly do the following actions:
- Add a new gauge type for Fundraising via CRV inflation.
- Add a new gauge (Genesis Gauge) for funding the Vyper Smart Contract Language development. Maximum emissions directed to this gauge would be 2,000,000 CRV, awarded to the Vyper Team wallet address: wallet.vyper.eth.
An emissions cap of 2,000,000 CRV is less than 1% of the inflation budget for the current inflation epoch (inflation budget for this inflation epoch is approximately 233 million CRV). Directing 1% towards R&D seems reasonable (at the current market value of approximately USD 2 per CRV, this is equivalent to USD 4 million at maximum).
Genesis Gauge
We recommend adding the Vyper Fundraising gauge with a maximum emission of 2,000,000 CRV. Context & Rationale are provided below:
Who/What is Vyper?
- Vyper is a decentralised project run by community contributions + donations. It is currently NOT funded by the Ethereum Foundation, despite being first developed by Vitalik Buterin. Vyper and Curve have historically been symbiotic, as Curve’s lead SC dev @iamdefinitelyahuman currently has the highest commit count to the vyperlang codebase. At present, Vyper development sources its funding from community contributions + donations + Gitcoin grants.
- Curve & Vyper are incredibly synergistic - Curve Core devs love Vyper, which is evident since it is the primary smart contract language of Curve Finance. Therefore, funding Vyper development has a direct positive impact on the curve ecosystem. A few examples showing tangible evidence of Vyper’s impact on Curve are:
- Cross-chain gauge factory, enabling boosted CRV inflation across chains: this was impossible until Vyper added new features to the language.
- Supporting uint8 type: this allows the EIP2612 standard of ERC-20 approvals via secp256k1 signatures (gasless approvals).
- Vyper has reduced Curve contract code size, enabling more complex logic embedded into Curve’s smart contracts.
- Vyper has improved Curve contract efficiency, which translates into gas savings passed onto users.
- Vyper is inherently more readable than other smart contract languages: readability translates to better auditing, which further translates to more secure smart contracts.
Motivation for supporting Vyper R&D
- Vyper supports around 18bn in DeFi. Funding it would allow for more security in Curve’s contracts.
- Development of Vyper benefits decentralised protocols beyond Curve. Most notable beneficiaries include Yearn, Ribbon, BadgerDAO, and Lido, among others dependent on vyper (currently about 500+ Github repositories.
- Anything that improves Vyper improves Curve in the downstream. Having an open funding source from Curve DAO for its development is analogous to having an R&D budget for Curve.
- Funding Vyper positions the DAO as a funder of public goods.
We expect that emissions could potentially benefit:
- Hiring a full-time team.
- Vyper community grants.
- Increasing awareness by sponsoring events/hackathons etc.
- Increasing tooling support
In the coming days, we will collaborate with the Vyper team on scoping how the funds will be used in a similar template to the current Grant Submission template & present it to the Curve DAO for further information on the scope of projects funded.
Conclusion
We believe this experiment DAO-enabled token inflation for fundraising offers entirely new ways for a DAO to self-organise itself into decentralised funding councils. Such a gauge would herald a paradigm shift in fundraising, enabling the Curve Community to steer its funds & resources towards shared goals & values.
Community Signal:
- Deploy Genesis Fundraising Gauge and fund Vyper development.
- Do not deploy Genesis Fundraising Gauge and fund Vyper development.
0 voters