Simple Summary
Grant the Lyra Foundation a further 50,000,000 LYRA tokens and 208,184.50 USDC to make strategic deals and fund ongoing operations, ahead of the upcoming LDX migration period.
Abstract
The LYRA Foundation was established after a June 2023 LRFC passed, with its stated mandate to help bootstrap the v2 launch and support the Protocol’s decentralized growth. Since then, the Foundation has helped steward the launch of v2, which has:
- Generated $700,000+ in fees for the DAO
- Supported over $1 billion in trading volume
This proposal details a plan to renew the Foundation’s budget ahead of the LYRA to LDX migration in order to preserve flexibility and further support the adoption and proliferation of the v2 protocol throughout DeFi.
Motivation
Following the successful launch of v2, the scope of the Lyra protocol and DAO has increased. Over the next 12 months, the ability to move quickly in areas such as:
- Major strategic partnerships
- Treasury diversification
will be key to ensuring maximum growth and protocol adoption. A follow-on grant for the Lyra Foundation will allow for long-term deals with a large scope to be made.
Specification
The foundation requests a grant of:
- 50,000,000 LYRA
- $208,184.50 USDC
This represents 5% of the total LYRA token supply and the balance of USDC that remains in the shortExecutor smart contract.
Due to the migration - the non-LYRA funds in the shortExecutor may be subject to a governance attack, as the funds can be programatically released via an on-chain vote. Therefore the on-chain vote and transfer should take place on or before May 6th, 2 days prior to the LDX snapshot on May 8th.
Rationale
Use of Prior Grant (LYRA and USDC)
In the LRFC that established the Foundation, it was granted a budget of:
- 100,000,000 LYRA
- 1,500,000 USDC
- 750,000 OP
Of the 100,000,000 LYRA:
- 10,000,000 has been sold for USDC in strategic deals with long-term aligned partners
- 20,000,000 was allocated to long duration market making incentive programs (24 month time horizons)
- 30,000,000 has been allocated for long term core contributor alignment and incentives (both present and future)
- 40,000,000 remains unallocated
Of the 1,500,000 USDC (~2,666,000 after treasury diversification / strategic deals):
- $566,000 remains
- $1,600,000 has been used to contract with service providers operating infrastructure and building core infrastructure and software including and related to the protocol
- $300,000 has been used to rebate market maker program participants
- $200,000 seeded the on-chain security module / insurance fund
Use of Proposed Grant (LYRA and USDC)
The Foundation has to-date been successful acting as the DAO’s steward, and contracting with relevant entities to perform vital services ancillary to the core Lyra protocol. A renewed grant and funding will help to allow the DAO and protocol to move swiftly throughout 2024, and capitalize on strategic opportunities as soon as they arise. These opportunities include (but are not limited to):
- Large-scale strategic partnerships with other protocols and projects
- Continued agreements with those hosting off-chain infrastructure (rollup sequencer and order book) on behalf of the DAO.
- Contracting providers related to licensing and compliance objectives.
- Contracting with providers to improve protocol and ecosystem liquidity
We propose a number of renewed OKRs for the foundation:
| Objective | Key Results |
|---|---|
| Grow protocol activity | Construct long-term aligned liquidity agreements via market makers and protocol integrations on the Lyra Chain. Success will be measured by metrics including (but not limited to): volume, new users, security module fees generated. |
| Support continuous protocol development | Contract with relevant service providers (including core contributors) to develop protocol functionality, including (but not limited to): AMM design and development, automated strategy vaults, new collateral onboarding, autonomous hedging vaults, new partnerships. Success to be measured against metrics including (but not limited to): number of new integrations, integration time for developers, integration volumes. |
| Act as an advocate for the protocol | Take advantage of beneficial opportunities on behalf of the protocol. Offer service providers clarity, accountability, and competitive contract opportunities. |
| Treasury Diversification | Facilitate diversification of the DAO treasury to ensure it has sufficient capital to fund long term development and growth of the protocol and ecosystem. |
Configurable Parameters
Recipient address: 0xAC81065eC33C149De27ab471181bF1baE198b5EA
USDC amount: 208,184.50
LYRA amount: 50,000,000
Requested date: May 6th 2024
Test Cases
N/A