Indexed

Discussion Thread: https://forum.indexed.finance/t/proposal-to-distribute-ndx-rewards-on-ruler/561

Approved Snapshot Vote: https://snapshot.org/#/ndx.eth/proposal/QmU9aqbKMLh1vYtaGcnomYCzYMg8SgRKi58X3pCbQ2KaHf

Summary

This proposal - if adopted - will transfer 7,000 NDX from the Indexed DAO treasury to the Ruler developer multisig for the purpose of incentivising dual-reward liquidity mining on the DEFI5-DAI lending pair on Ruler for a period of 8 weeks.

The Ruler team has agreed to match our contribution in dollar terms in RULER, resulting in a reward pool of approximately ~US$80,000 (at the time of proposal submission).

Justification

The DEFI5, CC10 and DEGEN instruments maintained by Indexed Finance are currently sufficiently liquid to be traded in large quantities via Uniswap with an acceptable degree of slippage (approximately 0.5% on a 10 ETH buy). Having met this requirement - which allows the tokens to act as proxy ETFs - we believe that the next objective of the DAO should be the expansion of derivative utility for these instruments.

Such utility - even that as ‘simple’ as the ability to act as collateral - for these index trackers permits end-users and market makers alike increased flexibility in terms of managing their risk profile and ability to maximise returns via speculation on the near-term growth or decline of a market sector through a single asset.

DEFI5 is our flagship index at present, comprising assets that are already natural choices for lending collateral. Introducing the ability to lend against such an aggregate instrument - acting as it does as a volatility hedge for decentralised finance writ large - is, in our opinion, a natural step on the path to its wider adoption.

Adoption of this proposal, and the subsequent introduction of DEFI5 to the Ruler protocol as a lendable asset, exposes our best performing product to a critical part of many DeFi strategies.

We encourage you to vote for this proposal, and look forward to working with Ruler.