Olympus DAO

Authors: Mark11 & Json - on behalf of the DAO

Summary Seek authority from community governance to launch liquidity on Balancer. Begin liquidity provision with OHM-ETH-DAI (with proposed weights of 50%, 25%, 25% weighted) or OHM-DAI (50%-50% weights) - dependent on liquidity availability during the migration period. The maximum treasury allocation to pool liquidity will be set at $25 million worth of OHM and $12.5 million each of DAI and ETH.

Establishing a liquidity pool on Balancer will make OHM a liquid asset in that ecosystem and therefore allow new protocols to conduct their initial fundraising denominated in OHM using Balancer LBPs - see: Liquidity Bootstrapping Pool (LBP) LBP token launch auctions.

This proposal also seeks authority for the DAO to carry out an LBP funding program in appropriate circumstances. This would involve loaning treasury OHM to approved and vetted partners for the required non-native portion in commencing Balancer LBP pools for initial fundraising (pools would usually start with weights of 5%OHM- 95% governance-token). The loaned OHM will not be provided unless it is to an LBP pool being controlled at all times by a partner multisig with a majority of reputable signers - either individuals or organizations with a verifiable good reputation. A cap of no more than $10 million in OHM would be available to be loaned at any time. Olympus may charge the loaned projects a fee to be paid in the project’s native token for the service.

Motivation A number of protocols have approached the DAO concerning an intention to conduct their token public auctions in OHM and to date, there has not been sufficient OHM liquidity on the Balancer platform in order to achieve this - establishing an OHM-ETH-DAI liquidity pool would enable this.

The Balancer liquidity pool established by Olympus would increase the network effects of OHM across another trading venue and further increase volume exposure to OHM, generating pool trading fees. Establishing an OHM-DAI-ETH liquidity pool on Balancer will allow projects to fundraise in OHM and will also earn Olympus pool trading fees. The liquidity pool will require up to $25 million of OHM, $12.5 million each of ETH and DAI from the treasury in the form of LP positions. At the time of writing, the Treasury currently holds $270mm in OHM-DAI and $120mm in OHM-ETH.

While it is important to establish liquidity on Balancer so protocols can publicly raise in OHM. One service of further assistance we can provide to reputable and vetted projects is an LBP funding program. All OHM utilized for the LBP funding loan program will come from the DAO. Currently, the DAO holds $598M in OHM. It is imperative that we utilize this OHM to bring value to the Olympus ecosystem. This program would allow Olympus to help facilitate the raising in OHM by lending protocols the non-native pool share of their LBP.

For example, a project that: Seeks to provide 5% of its total supply for LBP launch with $100 million fully diluted valuation have starting weights of 5%-95% Would need just $250,000 worth of OHM to commence its LBP pool.

Providing LBP funding by loaning OHM, would be conditional upon the LBP pool being controlled at all times by a partner multisig with a majority of reputable signers. This would be either individuals or organizations with a verifiable good reputation. A cap of no more than $10 million in OHM would be available to be loaned at any time. Olympus may also charge the loaned projects a fee to be paid in the project’s native token to be determined by the DAO. Projects must undergo strict due diligence, conducted by Olympus DAO contributors, prior to being accepted for the LBP funding program. This is in order to ensure that projects and their teams are of sufficient reputation and quality and have sufficient operational security - so there can be satisfaction that they will not pose a risk to Olympus’ reputation.

Proposal Seek authority from community governance to launch liquidity on Balancer. Begin liquidity provision with OHM-ETH-DAI (with proposed weights of 50%, 25%, 25% weighted) or OHM-DAI (50%-50% weights) - dependent on liquidity availability during the migration period. The maximum treasury allocation to pool liquidity will be set at $25 million worth of OHM and $12.5 million each of DAI and ETH. This proposal will also authorize the DAO Treasury management contributors to decrease or increase (up to the $50 million maximum) the pool to optimize liquidity utilization. Adjustment may be necessary in order for the pool to capture further trading revenue or if the assets are being underutilized to remove them back to the treasury to consolidate our funds. Additionally, request pre-approval to conduct a migration of the Balancer pool to Curve v2 pool - once the Curve v2 pools launch - should the treasury management contributors consider it provides a better solution. The DAO must provide 5 days’ notice to the community prior to any pool migration.

Also, approve the DAO to carry out an LBP funding program. This would involve loaning treasury OHM to approved and vetted partners for the required non-native portion in commencing Balancer LBP pools for initial fundraising (pools would usually start with weights of 5%OHM- 95% governance-token). The loaned OHM will not be provided unless it is to an partner LBP pool being controlled at all times by a multisig with a majority of reputable signers - either independent individuals or organizations with a verifiable good reputation. A cap of no more than $10 million in OHM would be available to be loaned at any time. Olympus may charge the loaned projects a fee to be paid in the project’s native token for the service. Projects must undergo strict due diligence, conducted by Olympus DAO contributors, prior to being accepted for the LBP funding program. This is in order to ensure that projects and their teams are of sufficient reputation and quality and have sufficient operational security - so there can be satisfaction that they will not pose a risk to Olympus’ reputation. All loaned OHM must be returned to the treasury upon the finalization of the LBP fundraising pool. The program may include additional security measures considered appropriate by the DAO contributors, including requiring a security deposit.

Vote For: Approve Balancer pool & LBP funding program Against: Do nothing