The Commons: shoring up OP’s liquidity, governance, and funding capacity
Hi, I’m Jack from Velodrome, a leading Optimism dex that recently received a 3 mm OP grant from OP Labs, a close collaborator in the build of our protocol. We’ve mostly been heads down building and showing up in partner discords, and we’re looking forward to participating more in OP governance. Consider this our first effort in earnest to engage, following some observations we’ve made.
OP grants to date are meeting some common needs…
Congratulations to protocol teams who have successfully received grants from the Optimism Collective. As part of Velodrome’s research on how best to apply, we read and catalogued every governance proposal to see which approaches seemed reasonable and what the community had to say about each. A few key themes jumped out:
Through Phase 0 and round 1 of Phase 1 , a total of ~ 40 . 3 mm OP approved for distribution
Of this, 40 . 0 mm OP — ~ 99 % of the total — earmarked for payment (to be likely sold)
The only OP designated for some use is for protocol-owned liquidity
We observed successful grants primarily seeking, loosely speaking, three forms of aid: liquidity ( 35 %), user acquisition ( 28 %), and ecosystem engagement ( 21 %). All of these (necessary and valuable!) forms of help essentially amount to a guarantee of a protocol paying someone OP, which would then in all likelihood be sold for ETH or some stablecoin.
…and are a lot for OP to digest
Across the three largest dexes featuring LP, there are roughly 10 mm OP in liquidity pools. If we assume the ~ 40 mm distributed OP to be sold evenly over the next six months, we’re looking at 6 . 7 mm OP sell pressure – two thirds of all the OP in liquidity pools – every month.
Simply offering OP to be market dumped for these purposes in this way is an attempt to outrun the token’s degradation, hoping that eventually enough economic value will be generated by the community before the glamour surrounding the OP token’s potential fades to oblivion.
People have hypothesized that it could come from blockspace demand. It could be MEV, transaction ordering, or even community-level partnerships. But there is currently limited tangible value accruing to the Collective, and as far as we can tell there haven’t been significant moves on this issue – and the need to address it is likely imminent.
So we’re offering a broader proposal, one we believe could make a huge difference for the ecosystem. It would help the OP token meet its intended purpose — sustainably fund public goods that may otherwise go unsupported — while lending a crucial layer of relevance to the Optimism Collective as a governing community.
We call it The Commons.
The Commons: securing public infrastructure
OP does in fact have a valuable function in permissionless settings: you can pair it with other tokens on AMMs and use it as a central liquidity node, the same way WETH works on Mainnet or, say, OSMO on Osmosis. This has the effect of providing liquidity to less central tokens, all while increasing the base token’s price stability.
So rather than simply doling out OP to protocols, under this plan Optimism’s governance would reserve some portion of tokens currently earmarked for distribution each round to be used for liquidity pairing. To gain liquidity for their native or utility tokens, applicant protocols would now offer the Optimism Collective some of these tokens for pairing.
As an example, we’ll look backward at the roughly 15 mm OP being distributed to help with some form of liquidity. Let’s say OP had instead set aside 10 mm of that OP for pairing with native tokens. Roughly speaking, the following would occur:
25 % of all previously distributed tokens would instead be earmarked for pairing
Selling pressure is reduced by nearly 25 %, or 1 . 7 mm OP per month, to 5 mm OP per month
Adding 10 mm of OP into liquidity would double the amount of OP currently in LPs to 20 mm OP in LPs.
So we’ll have gone from dumping 67 % of aggregate OP in LPs to 25 % every month.
In addition, assuming a 35 % benchmark APR we at Velo are using, the current $ 10 mm (assuming OP at 50 c) gained from liquidity provision would return roughly $ 1 . 75 mm over 6 months, not including compounding [note: may vary substantially due to the many potential ways of deploying LP across different platforms].
Good for protocols
The selling point for protocols is simply this: they’re already asking for more liquidity from Optimism than what’s provided by this example and, even outside of OP grants, are incentivizing protocols such as Curve (and, yes, Velodrome). This is all to say that there clearly exists demand for this sort of liquidity backstop. This proposal would provide them this exact service while also giving them a responsible steward of their tokens. And, because this action lends some material value to the Collective, our hope is that it kickstarts similar initiatives accruing additional value and signals to the broader market that there is a nascent economic engine beneath us.
Becoming the Collective
By obtaining a wide range of ecosystem governance tokens, the Optimism community will gain broader governance power, creating a new layer of metagovernance available to Collective members to help shape the ecosystem for public benefit. The Collective’s status as stakeholder of participating protocols would then be formalized and made actionable. Delegates can now vote not just on Optimism-specific proposals but also on individual protocols’ proposals. Collective members now have a direct channel to partner with Optimism protocols, and some could even act as specialized representatives on behalf of Optimism. There is a lot of design space here.
This exact scenario has already played out for Velodrome. Some of you might know that when we first designed our token distribution, Velodrome took the initiative to grant Optimism 5 % of our initial token share. This has proven to be one of our best decisions yet; Optimism has already gotten back its initial $ 150 , 000 grant to us in token value alone, and in the meantime it has collected substantial fees and compounded its power to incentivize liquidity in ways that have been beneficial for the ecosystem. And most importantly, that ownership has facilitated a close partnership between us and OP Labs; we actively work with them to help them use our protocol to best serve their interests.
Community member dcao has illustrated this mode of value creation through recomposition succinctly:
image 1118 × 1000 123 KB
This is unironically true.
The Bet
The Working Constitution calls for the Optimism Collective to “undertake a series of governance experiments” to, among other things, “sustainably fund those public goods that improve upon the well-being of the Collective and beyond” and “minimize the discrepancy between collective impact and individual profit.”
We’re asking the Collective to take the experimental bet that acquiring a stake in partner protocols in exchange for crucial, clearly desired support does indeed serve this vision—that properly seating the Optimism Collective’s capacity in the combined value of participants’ efforts and successes will lead to new directions in shared responsibility and prosperity.
And we’re asking protocols on Optimism to do more than express support for the public good as a concept and take another bet, that they will in fact be better off by formalizing a commitment to the public good and inviting the greater Optimism community to the table. It wouldn’t be for nothing — they would gain a responsible holder of their tokens, in addition to all of the other benefits they stand to gain from partnering more closely with the Optimism Collective.
We’re Optimistic
There’s a reason why, when we were invited by Optimism to migrate from the Fantom ecosystem and build a liquidity hub, we shifted our entire trajectory as veDAO toward this new space. We saw in Optimism a unique ecosystem where it seemed that people were putting money where their mouth was when it came to experimentation in governance modes.
And now that we’re here, we want to help Optimism take real steps in proving that its philosophy of mobilizing new governance structures to build and maintain public goods can and does work.
One step in this direction, we think, is the communal ownership of liquidity, which we believe can be a public good. It helps that owning liquidity also happens to be a value-accretive activity, which in turn will help us fund more public goods in a sustainable way.
This, of course, all comes back to the question of why we have OP the token in the first place. Its sole purpose ought to be to fund public goods for the betterment of the community—so let’s make sure that this token can continue to do so by supporting its value through meaningful economic action.
Open questions
We invite discussion on this issue, as there are some details and specific cases we have a view on but could use more perspectives. For instance:
How would this be incentivized or required? Would there be some ‘bonus’ OP pool set aside?
How much OP currently requested for liquidity as a proportion of the total OP distributed should be targeted?
How do we factor protocols’ market cap (or having any token on OP) into these considerations?
Would OP compound LP positions or accrue vote power (in the case of, e.g., positions on Velodrome and Curve)?
Can we call this layer-owned liquidity (LOL)?
What would be the actual mechanics of managing the LPs? Who administers them?
Proposed timeline
We suggest that new grants be frozen until we consider this proposal. It is critically important that the Collective appreciate the likely inability of the current liquidity infrastructure to handle projected sell pressure.
We look forward to hearing thoughts on this.
Velodrome received a grant from OP Labs and has been analyzing the governance proposals related to grants in the Optimism Collective. They propose a new concept called "The Commons" to address the current challenges related to liquidity and token distribution. The idea involves using some distributed tokens for liquidity pairing rather than direct distribution, aiming to reduce sell pressure and increase the value of OP tokens. They suggest that this approach would provide benefits to protocols while also adding value to the Optimism Collective. Additionally, Velodrome envisions a scenario where the Collective gains governance power over partner protocols, enhancing metagovernance possibilities and fostering collaboration. They call for a communal ownership of liquidity, emphasizing the importance of public goods funding within the community. The post encourages open discussion on the proposal and poses questions for further consideration, suggesting a pause on new grants until the proposal is reviewed. The ultimate goal is to support the value and purpose of OP tokens in sustaining public goods for the community's benefit.
forrest: For any token incentive program, the most important measure is Emissions over Revenue. Projects almost always overpay for growth at the beginning ($1 of Emissions leads to less than $1 of fees), with the goal of flipping that ratio in the future. It’s worth noting that in Optimism’s case, the stated goal for OP incentives is that they not only lead to more transactions (revenue) but also more liquidity and users.
Importantly, none of the Phase 0 programs have started distributing OP, so we cannot really measure this Emissions/Revenue ratio for Optimism.
This also means your OP sell pressure numbers are hypothetical and probably overstated. You assume every single OP token will be sold on the market which is misleading, I think it’s fair to assume at least some amount will be held or staked in liquidity pools.
Backing this claim up with data from another network’s liquidity mining campaign (ex. Polygon or Avalanche) would be helpful. I know that in both cases, native token incentives for dapps led to growth in all of the key areas: transactions, liquidity, and users. And they did this without having the native token collapse from sell pressure.
My biggest problem with the proposal is that it would see the Optimism Treasury take on significant impermanent loss risk. Token pairs with high divergence are more likely to suffer from impermanent loss, and it’s fair to assume OP will continue to be more volatile than say, ETH. Arbitrageurs will rejoice if OP is naively overallocated into constant product AMMs.
While having the Optimism Collective act as meta-governance in the ecosystem might accrue some value to the OP token, I think it would challenge the network’s claim of being credibly neutral. Optimism functions as an extension of Ethereum, and maintaining credible neutrality is a must. Optimism was already accused of showing certain apps favoritism, and this proposal could make things much worse.
jackanorak:
This is unironically true.
Unironically, impermanent loss invalidates the meme. By pairing OP with long tail tokens on AMMs, the Collective would lose value on many of their positions.
jackanorak:
We suggest that new grants be frozen until we consider this proposal.
This is a ridiculous suggestion. The Collective should continue giving grants to projects they believe can convert incentives into more Optimism transactions, liquidity, and users.
Overall, this proposal uses a lot of hyperbole and does not establish itself as clearly better than the OP incentives that dozens of projects are about to kick off, many of which will enhance the OP token’s on-chain liquidity. Pairing OP with new projects’ tokens on AMMs is not “funding public goods”, I hope other readers and delegates see this clearly.
I believe the OP token’s utility will reach maturity only once sequencing/block production is decentralized. This is where it will derive most of its value, and trying to append weird and somewhat risky utility onto it now is a bit short-sighted.
I am not in favor of this proposal and would vote against it.
Disclosure: I am on the Rubicon team. Regardless of how it would impact our protocol, I simply think this is not a wise move for the Collective.
wcc: I would break my takes into two parts: high level (concepts) and implementation level (approach to execute/distribute properly)
On a high level
jackanorak:
Simply offering OP to be market dumped for these purposes in this way is an attempt to outrun the token’s degradation, hoping that eventually enough economic value will be generated by the community before the glamour surrounding the OP token’s potential fades to oblivion.
People have hypothesized that it could come from blockspace demand. It could be MEV, transaction ordering, or even community-level partnerships. But there is currently limited tangible value accruing to the Collective, and as far as we can tell there haven’t been significant moves on this issue – and the need to address it is likely imminent.
I mostly agree with this statement. Liquidity is one of many key metrics and plays a vital role in adoption whether we want to accept this or not.
Regarding governance fund phase 1, I think it would help protocols on OP to bootstrap users together with liquidity over to OP. However, I have observed that many protocols difficult to match incentives with OP tokens. My take on this is most protocols foresee that the OP token value will be dumped for a while given economic value is limited and still underrealized by the market norms. If the market value of OP dropped, it will lead to difficulty for protocols to inorganically bootstrap new users/liquidity from granted OP.
After I read this proposal, I took EVM (Polygon, BSC) and non-EVM (Osmosis) as references, and it proved that the chain representative tokens are mainly used as the main pair (or second to stablecoin(s)).
Referring back to Optimism, based on what I can find, there are only WETH and VELO that are highly paired with OP. The rest are heavily paired with USDC.
On an implementation level
I would not comment on this since I still could not think of ways to execute the liquidity pairing properly. (not saying your proposal is wrong, maybe just me that is unable to imagine it)
diligit: That’s good, now I understand how metagovernance will be achieved and how the Optimism Collective will be involved in it. There is too much extra information in the proposal, it would be better if it was structured in “Why” and “For” in details, but yes, I support the proposal.
And I can answer your questions:
jackanorak:
How would this be incentivized or required?
From Ecosystem Fund, through GF
jackanorak:
Would there be some ‘bonus’ OP pool set aside?
Yes
jackanorak:
How much OP currently requested for liquidity as a proportion of the total OP distributed should be targeted?
max. 5%
jackanorak:
Would OP compound LP positions or accrue vote power (in the case of, e.g., positions on Velodrome and Curve)?
50/50
jackanorak:
Can we call this layer-owned liquidity (LOL)?
Yes
jackanorak:
What would be the actual mechanics of managing the LPs? Who administers them?
The Optimism Foundation
What a great proposal jack! I (a new user with 0 posts) completely support this. Perhaps the OP f…
What a great proposal jack! I (a new user with 0 posts) completely support this. Perhaps the OP foundation could use this new dex I found called “velodrome” to create the LPs proposed by this proposal. Jack, have you heard about this dex before? With the simple passage of this proposal we could drive hundreds of millions of dollars to velodrome TVL. Maybe I should buy some VELO token.
The Commons: shoring up OP’s liquidity, governance, and funding capacity Hi, I’m Jack from Velodro…
The Commons: shoring up OP’s liquidity, governance, and funding capacity Hi, I’m Jack from Velodrome, a leading Optimism dex that recently received a 3 mm OP grant from OP Labs, a close collaborator in the build of our protocol. We’ve mostly been heads down building and showing up in partner discords, and we’re looking forward to participating more in OP governance. Consider this our first effort in earnest to engage, following some observations we’ve made. OP grants to date are meeting some common needs… Congratulations to protocol teams who have successfully received grants from the Optimism Collective. As part of Velodrome’s research on how best to apply, we read and catalogued every governance proposal to see which approaches seemed reasonable and what the community had to say about each. A few key themes jumped out: Through Phase 0 and round 1 of Phase 1 , a total of ~ 40 . 3 mm OP approved for distribution Of this, 40 . 0 mm OP — ~ 99 % of the total — earmarked for payment (to be likely sold) The only OP designated for some use is for protocol-owned liquidity We observed successful grants primarily seeking, loosely speaking, three forms of aid: liquidity ( 35 %), user acquisition ( 28 %), and ecosystem engagement ( 21 %). All of these (necessary and valuable!) forms of help essentially amount to a guarantee of a protocol paying someone OP, which would then in all likelihood be sold for ETH or some stablecoin. …and are a lot for OP to digest Across the three largest dexes featuring LP, there are roughly 10 mm OP in liquidity pools. If we assume the ~ 40 mm distributed OP to be sold evenly over the next six months, we’re looking at 6 . 7 mm OP sell pressure – two thirds of all the OP in liquidity pools – every month. Simply offering OP to be market dumped for these purposes in this way is an attempt to outrun the token’s degradation, hoping that eventually enough economic value will be generated by the community before the glamour surrounding the OP token’s potential fades to oblivion. People have hypothesized that it could come from blockspace demand. It could be MEV, transaction ordering, or even community-level partnerships. But there is currently limited tangible value accruing to the Collective, and as far as we can tell there haven’t been significant moves on this issue – and the need to address it is likely imminent. So we’re offering a broader proposal, one we believe could make a huge difference for the ecosystem. It would help the OP token meet its intended purpose — sustainably fund public goods that may otherwise go unsupported — while lending a crucial layer of relevance to the Optimism Collective as a governing community. We call it The Commons. The Commons: securing public infrastructure OP does in fact have a valuable function in permissionless settings: you can pair it with other tokens on AMMs and use it as a central liquidity node, the same way WETH works on Mainnet or, say, OSMO on Osmosis. This has the effect of providing liquidity to less central tokens, all while increasing the base token’s price stability. So rather than simply doling out OP to protocols, under this plan Optimism’s governance would reserve some portion of tokens currently earmarked for distribution each round to be used for liquidity pairing. To gain liquidity for their native or utility tokens, applicant protocols would now offer the Optimism Collective some of these tokens for pairing. As an example, we’ll look backward at the roughly 15 mm OP being distributed to help with some form of liquidity. Let’s say OP had instead set aside 10 mm of that OP for pairing with native tokens. Roughly speaking, the following would occur: 25 % of all previously distributed tokens would instead be earmarked for pairing Selling pressure is reduced by nearly 25 %, or 1 . 7 mm OP per month, to 5 mm OP per month Adding 10 mm of OP into liquidity would double the amount of OP currently in LPs to 20 mm OP in LPs. So we’ll have gone from dumping 67 % of aggregate OP in LPs to 25 % every month. In addition, assuming a 35 % benchmark APR we at Velo are using, the current $ 10 mm (assuming OP at 50 c) gained from liquidity provision would return roughly $ 1 . 75 mm over 6 months, not including compounding [note: may vary substantially due to the many potential ways of deploying LP across different platforms]. Good for protocols The selling point for protocols is simply this: they’re already asking for more liquidity from Optimism than what’s provided by this example and, even outside of OP grants, are incentivizing protocols such as Curve (and, yes, Velodrome). This is all to say that there clearly exists demand for this sort of liquidity backstop. This proposal would provide them this exact service while also giving them a responsible steward of their tokens. And, because this action lends some material value to the Collective, our hope is that it kickstarts similar initiatives accruing additional value and signals to the broader market that there is a nascent economic engine beneath us. Becoming the Collective By obtaining a wide range of ecosystem governance tokens, the Optimism community will gain broader governance power, creating a new layer of metagovernance available to Collective members to help shape the ecosystem for public benefit. The Collective’s status as stakeholder of participating protocols would then be formalized and made actionable. Delegates can now vote not just on Optimism-specific proposals but also on individual protocols’ proposals. Collective members now have a direct channel to partner with Optimism protocols, and some could even act as specialized representatives on behalf of Optimism. There is a lot of design space here. This exact scenario has already played out for Velodrome. Some of you might know that when we first designed our token distribution, Velodrome took the initiative to grant Optimism 5 % of our initial token share. This has proven to be one of our best decisions yet; Optimism has already gotten back its initial $ 150 , 000 grant to us in token value alone, and in the meantime it has collected substantial fees and compounded its power to incentivize liquidity in ways that have been beneficial for the ecosystem. And most importantly, that ownership has facilitated a close partnership between us and OP Labs; we actively work with them to help them use our protocol to best serve their interests. Community member dcao has illustrated this mode of value creation through recomposition succinctly: image 1118 × 1000 123 KB This is unironically true. The Bet The Working Constitution calls for the Optimism Collective to “undertake a series of governance experiments” to, among other things, “sustainably fund those public goods that improve upon the well-being of the Collective and beyond” and “minimize the discrepancy between collective impact and individual profit.” We’re asking the Collective to take the experimental bet that acquiring a stake in partner protocols in exchange for crucial, clearly desired support does indeed serve this vision—that properly seating the Optimism Collective’s capacity in the combined value of participants’ efforts and successes will lead to new directions in shared responsibility and prosperity. And we’re asking protocols on Optimism to do more than express support for the public good as a concept and take another bet, that they will in fact be better off by formalizing a commitment to the public good and inviting the greater Optimism community to the table. It wouldn’t be for nothing — they would gain a responsible holder of their tokens, in addition to all of the other benefits they stand to gain from partnering more closely with the Optimism Collective. We’re Optimistic There’s a reason why, when we were invited by Optimism to migrate from the Fantom ecosystem and build a liquidity hub, we shifted our entire trajectory as veDAO toward this new space. We saw in Optimism a unique ecosystem where it seemed that people were putting money where their mouth was when it came to experimentation in governance modes. And now that we’re here, we want to help Optimism take real steps in proving that its philosophy of mobilizing new governance structures to build and maintain public goods can and does work. One step in this direction, we think, is the communal ownership of liquidity, which we believe can be a public good. It helps that owning liquidity also happens to be a value-accretive activity, which in turn will help us fund more public goods in a sustainable way. This, of course, all comes back to the question of why we have OP the token in the first place. Its sole purpose ought to be to fund public goods for the betterment of the community—so let’s make sure that this token can continue to do so by supporting its value through meaningful economic action. Open questions We invite discussion on this issue, as there are some details and specific cases we have a view on but could use more perspectives. For instance: How would this be incentivized or required? Would there be some ‘bonus’ OP pool set aside? How much OP currently requested for liquidity as a proportion of the total OP distributed should be targeted? How do we factor protocols’ market cap (or having any token on OP) into these considerations? Would OP compound LP positions or accrue vote power (in the case of, e.g., positions on Velodrome and Curve)? Can we call this layer-owned liquidity (LOL)? What would be the actual mechanics of managing the LPs? Who administers them? Proposed timeline We suggest that new grants be frozen until we consider this proposal. It is critically important that the Collective appreciate the likely inability of the current liquidity infrastructure to handle projected sell pressure. We look forward to hearing thoughts on this.
forrest: For any token incentive program, the most important measure is Emissions over Revenue. Projects almost always overpay for growth at the beginning ($1 of Emissions leads to less than $1 of fees), with the goal of flipping that ratio in the future. It’s worth noting that in Optimism’s case, the stated goal for OP incentives is that they not only lead to more transactions (revenue) but also more liquidity and users.
Importantly, none of the Phase 0 programs have started distributing OP, so we cannot really measure this Emissions/Revenue ratio for Optimism.
This also means your OP sell pressure numbers are hypothetical and probably overstated. You assume every single OP token will be sold on the market which is misleading, I think it’s fair to assume at least some amount will be held or staked in liquidity pools.
Backing this claim up with data from another network’s liquidity mining campaign (ex. Polygon or Avalanche) would be helpful. I know that in both cases, native token incentives for dapps led to growth in all of the key areas: transactions, liquidity, and users. And they did this without having the native token collapse from sell pressure.
My biggest problem with the proposal is that it would see the Optimism Treasury take on significant impermanent loss risk. Token pairs with high divergence are more likely to suffer from impermanent loss, and it’s fair to assume OP will continue to be more volatile than say, ETH. Arbitrageurs will rejoice if OP is naively overallocated into constant product AMMs.
While having the Optimism Collective act as meta-governance in the ecosystem might accrue some value to the OP token, I think it would challenge the network’s claim of being credibly neutral. Optimism functions as an extension of Ethereum, and maintaining credible neutrality is a must. Optimism was already accused of showing certain apps favoritism, and this proposal could make things much worse.
jackanorak:
This is unironically true.
Unironically, impermanent loss invalidates the meme. By pairing OP with long tail tokens on AMMs, the Collective would lose value on many of their positions.
jackanorak:
We suggest that new grants be frozen until we consider this proposal.
This is a ridiculous suggestion. The Collective should continue giving grants to projects they believe can convert incentives into more Optimism transactions, liquidity, and users.
Overall, this proposal uses a lot of hyperbole and does not establish itself as clearly better than the OP incentives that dozens of projects are about to kick off, many of which will enhance the OP token’s on-chain liquidity. Pairing OP with new projects’ tokens on AMMs is not “funding public goods”, I hope other readers and delegates see this clearly.
I believe the OP token’s utility will reach maturity only once sequencing/block production is decentralized. This is where it will derive most of its value, and trying to append weird and somewhat risky utility onto it now is a bit short-sighted.
I am not in favor of this proposal and would vote against it.
Disclosure: I am on the Rubicon team. Regardless of how it would impact our protocol, I simply think this is not a wise move for the Collective.
wcc: I would break my takes into two parts: high level (concepts) and implementation level (approach to execute/distribute properly)
On a high level
jackanorak:
Simply offering OP to be market dumped for these purposes in this way is an attempt to outrun the token’s degradation, hoping that eventually enough economic value will be generated by the community before the glamour surrounding the OP token’s potential fades to oblivion.
People have hypothesized that it could come from blockspace demand. It could be MEV, transaction ordering, or even community-level partnerships. But there is currently limited tangible value accruing to the Collective, and as far as we can tell there haven’t been significant moves on this issue – and the need to address it is likely imminent.
I mostly agree with this statement. Liquidity is one of many key metrics and plays a vital role in adoption whether we want to accept this or not.
Regarding governance fund phase 1, I think it would help protocols on OP to bootstrap users together with liquidity over to OP. However, I have observed that many protocols difficult to match incentives with OP tokens. My take on this is most protocols foresee that the OP token value will be dumped for a while given economic value is limited and still underrealized by the market norms. If the market value of OP dropped, it will lead to difficulty for protocols to inorganically bootstrap new users/liquidity from granted OP.
After I read this proposal, I took EVM (Polygon, BSC) and non-EVM (Osmosis) as references, and it proved that the chain representative tokens are mainly used as the main pair (or second to stablecoin(s)).
Referring back to Optimism, based on what I can find, there are only WETH and VELO that are highly paired with OP. The rest are heavily paired with USDC.
On an implementation level
I would not comment on this since I still could not think of ways to execute the liquidity pairing properly. (not saying your proposal is wrong, maybe just me that is unable to imagine it)
diligit: That’s good, now I understand how metagovernance will be achieved and how the Optimism Collective will be involved in it. There is too much extra information in the proposal, it would be better if it was structured in “Why” and “For” in details, but yes, I support the proposal.
And I can answer your questions:
jackanorak:
How would this be incentivized or required?
From Ecosystem Fund, through GF
jackanorak:
Would there be some ‘bonus’ OP pool set aside?
Yes
jackanorak:
How much OP currently requested for liquidity as a proportion of the total OP distributed should be targeted?
max. 5%
jackanorak:
Would OP compound LP positions or accrue vote power (in the case of, e.g., positions on Velodrome and Curve)?
50/50
jackanorak:
Can we call this layer-owned liquidity (LOL)?
Yes
jackanorak:
What would be the actual mechanics of managing the LPs? Who administers them?
The Optimism Foundation
What a great proposal jack! I (a new user with 0 posts) completely support this. Perhaps the OP f…
What a great proposal jack! I (a new user with 0 posts) completely support this. Perhaps the OP foundation could use this new dex I found called “velodrome” to create the LPs proposed by this proposal. Jack, have you heard about this dex before? With the simple passage of this proposal we could drive hundreds of millions of dollars to velodrome TVL. Maybe I should buy some VELO token.
Couple of points:
36 M that was distributed in Phase 0 was for liquidity and user on-boarding s…
Couple of points:
36 M that was distributed in Phase 0 was for liquidity and user on-boarding so I dont see a problem if those token are sold out or dumped. That was their sole purpose, on board liquidity according to their proposal
Yes, this assumption is wrong.
If we assume the ~ 40 mm distributed OP to be sold evenly over the next six months, we’re looking at 6 . 7 mm OP sell pressure – two thirds of all the OP in liquidity pools – every month.
Not all of the token will be sold, token distribution plan from their proposal is from 6 - 24 months and few of them are not using their token as an LP reward, so token distribution will be gradual.
This is nice idea but will not work
Delegates can now vote not just on Optimism-specific proposals but also on individual protocols’ proposals
It will cause bias, if I have a say in project X and they submit a proposal here on GF fund, only option for me to abstain from discussion.
This will work out just fine on organizational and/or project level, just as you mentioned below
Velodrome took the initiative to grant Optimism 5 % of our initial token share. This has proven to be one of our best decisions yet
And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias.
We are mixing two things here, price of OP and Public Good.
why we have OP the token in the first place
For public good we have dedicated 20 % fund and its distribution is based on different logic which I am really excited about.
We suggest that new grants be frozen until we consider this proposal
Again, in my opinion, this we should not do. Pausing will only hurt our progress we have made so far.
Few point because this proposal is mixing couple of things.
In Phase 1 , we are not just focusing on LP, we are also looking into user on boarding via different approach, application migration and integration, marketing and even development support if idea is unique. Now we are asking projects to submit KPI based proposal if its based on LP incentives and we are working on making sure that its sustainable, long term. Again, opinion varies according to delegate but from what I see, we are looking beyond just LP.
This seems to be focused on price of token with a mask of public good. We should keep them separate.
Personally, I dont see a proposal if token are being dumped as long the reason is justified in their proposal. Again, depends on proposal. At the end of day, 1 OP will always has 1 voting power as it should be, after all its a Gov token.
If you feel project proposal need improvement, join us and help us improve it.
Pausing will not help but asking question and providing feedback to project proposal will.
I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal.
I want to mention few things. We have an excellent gov model(token house and citizen house) which motivated me to join this gov and I think, it need feedback and suggestion.
We are in dire need of community engagement, if i look at the stats on this forum, user involvement are going down each passing day. What can we do for that ?Last voting cycle, we had 17 M vote count on proposal.
I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that.
Again, I might be in minority here, liquidity is not “critical” problem here but lack on user involvement is.
Resolving bias is another concern but that need a separate thread.
We have few thoughts and thread going on to improve overall gov process. Please join us there.
Economic sustainability ideas for $OP
Starting from first principles, this is my opinion for how $OP can be economically sustainable. My general philosophy is elegance, simplicity and minimal friction. No lockups, staking rewards and similar mechanisms - $OP will always be a frictionless, liquid token.
Revenues
Assuming a MEVA/PBS-like setup, builders (sequencers) bid in ETH. Note: depending on the implementation, users may pay fees in other tokens (e.g. OP, DAI) to dapps/builders, but this is abstracted away from Optimism Collect…
Solving voter apathy
In the last round, only ~ 12 % of circulating supply voted for proposals. We now have a single delegate that can pretty much override the entirety of active governance (effectively, a 51 % attack on Optimism Collective). We are seeing many token holders not delegate at all, or delegate to inactive delegates.
We have seen this be an issue with proof-of-stake chains. They solve this by basically bribing token holders to delegate their stake. A better way would be sharing sequencer revenues with dele…
Incentivizing effort from governance participants with retroactive rewards for good decisions ? Token House Governance
There is a general problem in DAOs of low participation in governance votes. Some DAO’s offer POAPs to Snapshot voters to encourage more voters, but while this increases the number of participants it does not necessarily increase the number of useful participants. What we want is a way to get people to apply more effort into their voting decisions, thus increasing the likelihood of a better outcome.
From reading discord chats there are certainly those who’s priority becomes obtaining the voting…
Update of the PHASE 1 protocol nomination template
This is a joint collaboration of: @OPUser (delegate), @Netrim @NicoProducto @Joxes @AxlVaz (DeFi Latam & Optimism Español [no oficial])
If I am missing the name of any contributor, please let me know.
Summary
Noting the number of proposals and consultations made by the delegates to the proponents. We request, along with other delegates and government members, this modification to the application template. So that projects/protocols/proponents can more robustly and strongly articulate the a…
What is Public Good to You
If you are active here and/or on discord, you might have seen some discussion on Public Good. I have been thinking about it and in last few days, after reading, learning and discussion within my circle, my definition of Public Good has changed a lot.
I have came to realization that its scope is much bigger than I initially thought and when we add RPGF to it, its gets more complex.
What is public good.
By definition public good can be anything that has two properties, non-rivel in consumption …
gabagool: OPUser:
I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal.
Wanted to make a comment not about the discussion here, but about your manner of discussion.
I’ve noted in several posts that you are quite dismissive of ideas you do not personally agree with, without providing clear rational or full engagement with contrary arguments.
You are not worried about token price, and do not think token price is connected to governance activity. Does that make these opinions true?
Why is liquidity not a crucial problem? How are you defining liquidity?
Why will Delegates voting on individual protocol’s proposals cause bias? Why should you abstain from a governance discussion or vote when a protocol submits to OP if you also participated in a governance discussion or vote on that individual protocol? Being a delegate somewhere should not curtail ANYONE from participating in governance elsewhere. This is core to the entire ethos of decentralization and autonomy.
You claim that “this assumption is wrong” re: the distributed grant OP being sold evenly over the next six months. First of all, be acknowledge that this is a hypothetical, but offer no clear numbers on how many protocols are using OP as Lp rewards. What makes YOUR assumption that “token distribution will be gradual” accurate? Can you please provide evidence for this assumption?
This proposal emerged out of a comprehensive review of every single grant proposal submitted to OP, and was also discussed prior to publication with members of the OP team itself.
OPUser:
And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias.
We are mixing two things here, price of OP and Public Good.
That is right, because they are mixed. Tokens have both economic value and governance value, and the very “public good funding” that the OP token is being used for DEPENDS on token value. No public good’s funding without the token having economic value.
OPUser:
we are also looking into user on boarding
This entire proposal is core to user onboarding. Maintaining economic value of $OP is fundamental to attracting new users to Optimism.
OPUser:
I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that.
Can you explain why you believe this? and why you are not concerned that a massive distribution of the OP token will result in a token price that could certainly result in negative tailwinds for Public Goods funding, governance, user activity, and more?
jackanorak: We were excited to hear OPUser’s thoughts due to their thoughtful feedback on our current draft proposal. We intend to clear up the entirety of their concerns voiced here, most of which we believe merely require some clarification.
36M that was distributed in Phase 0 was for liquidity and user on-boarding so I dont see a problem if those token are sold out or dumped. That was their sole purpose, on board liquidity according to their proposal
Yes, this assumption is wrong.
We made no value claims about where the tokens were going, just observing that for 99% of all tokens being distributed, the ultimate recipient is likely someone who is unmotivated to hold OP vs market selling it. Of course there’s nothing wrong with paying people to LP, use, or build on your product! Velodrome ourselves are using our grant for the same purposes – because these are things that protocols need. This is why we believe protocols have good reason to opt into our proposal, which addresses liquidity, by far the most requested need, and prolongs the efficacy of these programs.
That Governance is fine with using OP for these purposes doesn’t make it less unsustainable, which is our claim.
Not all of the token will be sold, token distribution plan from their proposal is from 6-24 months and few of them are not using their token as an LP reward, so token distribution will be gradual.
Going through the individual approved applications, we saw the distribution being heavily stacked toward the 6-12 month horizon. We certainly can provide supporting data if this is enough of a sticking point.
But even if tokens were distributed equally over 18 months (which is VERY generous); you’d still see unmitigated sell pressure of roughly a quarter of all LP’ed tokens each month. By the time the 6th month came around, the value of the grant would likely be a small fraction of what it would have been if spent at the start. Some GF proposals have already asked for an inflated amount of tokens, claiming they are anticipating this fact!
One thing we didn’t cover in our proposal would be that this observed sell pressure will heavily encourage front-loading of distributions by partner protocols, as they will stand to be better off using their tokens now and risk missing out on future grants than comply with expectations to get a second distribution worth a small fraction of the first.
It will cause bias, if I have a say in project X and they submit a proposal here on GF fund, only option for me to abstain from discussion.
This will work out just fine on organizational and/or project level, just as you mentioned below
If you believe that the Optimism Collective’s ownership of project governance tokens would bias your personal decisions, either you have graver concerns about the functionality of decentralized governance structures in general – or you (possibly correctly) believe that you, OPUser, individually have outsized influence on the collective, such that you can sway things for your personal benefit, which would naturally be problematic from a decentralization standpoint.
Separately, how would this structure be more problematic than an individual personally owning a large stake in project X and thus being conflicted — which of course is almost certainly the case for many delegates and perhaps something unavoidable?
To be honest, we believe this feature is the most exciting thing for committed delegates, as it reflects in our view a compelling experimentation around decentralized governance (and capitalism) – a collective stake in participating organizations.
This is nice idea but will not work
This opinion, on the other hand, in response to our data- and experience-driven proposal, has no support. Why not share your bias against this? Pretty sure we can address any material concerns you may have.
And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias.
Why would this be the case? Spell out exactly how they’d be biased. Is it because you think this benefits Velodrome? Note that nowhere do we mention Velodrome as a place to LP tokens; that is up to the OP Collective. If this is why you are concerned, do you believe that their small stake in Velodrome is enough to materially sway their interests?
There are many fantastic places to LP tokens, each with its benefits. Uni naturally has unique strengths, Beethoven’s well known for its farming abilities, etc.
And consider the opposite: it is entirely possible that they influenced us to make this proposal for the good of Optimism because, as tokenholders, they have a say in what sorts of communications we put out. And that would be a good thing. [To be clear, though, this proposal was entirely conceived by the Velodrome team.]
If someone from the Foundation were to comment on this, we would expect participants here to see them as people who put the Collective first. We’re genuinely confused at how you could expect otherwise.
We are mixing two things here, price of OP and Public Good.
Of course we are. We recognize the need to paint a veneer of propriety such that we don’t have random tokenholders screeching “but token price”, but until the OP Collective can figure out a way to accrue a material treasury, the token is how we have the ability to fund public goods. What we’re doing is offering a mechanical and governance-driven means of ensuring that this method is sustainable.
Seeing the token go to zero critically hamstrings the Collective’s capability to fund public goods or RFPG, which limits protocols’ capacity to facilitate user/liquidity/protocol onboarding, which lowers the stakes for governance participation, which leads to a death spiral.
We are laying out our concerns with the weight of experience of having seen this play out in several contexts – and, we believe, our expertise, having professionally consulted for protocols (e.g., Redacted) and layers (e.g., Boba) on this very subject, to say nothing of our deep history in complex tokenomics. We are sounding the warning here because not attending to this is a grave mistake. Let’s drop the pearls, people.
Again, in my opinion, this we should not do. Pausing will only hurt our progress we have made so far.
Pausing would prevent OP from multiplying the sell pressure overnight. Can you explain what sort of progress would be stalled in support of this? Why would delaying, say, two weeks have a material impact?
In Phase 1, we are not just focusing on LP, we are also looking into user on boarding via different approach, application migration and integration, marketing and even development support if idea is unique. Now we are asking projects to submit KPI based proposal if its based on LP incentives and we are working on making sure that its sustainable, long term. Again, opinion varies according to delegate but from what I see, we are looking beyond just LP.
As far as we can tell, none of these entails doing anything other than paying somebody OP so they can sell for stables. Would love to see an alternative — so much so that we’ve suggested one!
This seems to be focused on price of token with a mask of public good. We should keep them separate.
Already addressed above, but we’ll emphasize: this is an aesthetic objection to a material concern. The token price is not its own end; it is the sum total of Optimism’s operational capacity.
Moreover, this a rank misreading of our proposal, which is in fact not focused primarily on the token price.
The broader objectives you yourself have raised include participation in governance. Our proposal increases the stakes for governance.
The Constitution calls for experimentation in modes of governance; we’ve outlined in detail a way to dramatically expand the scope of governance.
You provide links to discussions on how to accrue value to governance; we’re not sure what else you can call our proposal.
Personally, I dont see a proposal if token are being dumped as long the reason is justified in their proposal. Again, depends on proposal. At the end of day, 1 OP will always has 1 voting power as it should be, after all its a Gov token.
Again, we’re not making value claims about the intended purpose of these tokens. We’re devising a win-win-win way to sustain these intended uses of the tokens.
For public good we have dedicated 20% fund and its distribution is based on different logic which I am really excited about.
Sure, but again we’re commenting specifically on the current program’s sustainability, on which we’re not picking up any material pushback.
We are in dire need of community engagement, if i look at the stats on this forum, user involvement are going down each passing day. What can we do for that ?Last voting cycle, we had 17M vote count on proposal.
I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that.
You can’t get around the fact that governance participation will pick up when there are higher stakes and modalities to it. Merely accepting the status quo of meting out rapidly depreciating tokens to a few dozen protocols is simply not enough to bring in outside participation, and tech updates will of course do precious little to affect that. But because we have a vested interest in making sure Optimism thrives, we will certainly do our part.
We have few thoughts and thread going on to improve overall gov process. Please join us there.
Sure, we’re happy to explain how this proposal would address all of these concerns. We’d actually considered doing this already. We’ll consider this your active encouragement to do so.
I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal.
You might be, but we hope others reading can critically evaluate this on its merits. It would indeed be a concerning thing for governance if participation is so low that OPUser’s opposition is enough to stall what we believe is the first immediately actionable way to address an imminent threat to Governance’s power to satisfy one of its core mandates.
Nonetheless, this is the only change you’ve convinced us to make in our proposal, if only because we want to encourage more discussion (and clear up some particulars) before finalizing, and marking it as READY may have discouraged that.
We are encouraging readers and delegates to think bigger; we want Optimism to grow up and meet its potential, and to do so we must be receptive to experimentation, especially when there is a sound thesis and solid support behind it.
OPUser:
I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal…
OPUser:
I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal.
Wanted to make a comment not about the discussion here, but about your manner of discussion.
I’ve noted in several posts that you are quite dismissive of ideas you do not personally agree with, without providing clear rational or full engagement with contrary arguments.
You are not worried about token price, and do not think token price is connected to governance activity. Does that make these opinions true?
Why is liquidity not a crucial problem? How are you defining liquidity?
Why will Delegates voting on individual protocol’s proposals cause bias? Why should you abstain from a governance discussion or vote when a protocol submits to OP if you also participated in a governance discussion or vote on that individual protocol? Being a delegate somewhere should not curtail ANYONE from participating in governance elsewhere. This is core to the entire ethos of decentralization and autonomy.
You claim that “this assumption is wrong” re: the distributed grant OP being sold evenly over the next six months. First of all, be acknowledge that this is a hypothetical, but offer no clear numbers on how many protocols are using OP as Lp rewards. What makes YOUR assumption that “token distribution will be gradual” accurate? Can you please provide evidence for this assumption?
This proposal emerged out of a comprehensive review of every single grant proposal submitted to OP, and was also discussed prior to publication with members of the OP team itself.
OPUser:
And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias.
We are mixing two things here, price of OP and Public Good.
That is right, because they are mixed. Tokens have both economic value and governance value, and the very “public good funding” that the OP token is being used for DEPENDS on token value. No public good’s funding without the token having economic value.
OPUser:
we are also looking into user on boarding
This entire proposal is core to user onboarding. Maintaining economic value of $OP is fundamental to attracting new users to Optimism.
OPUser:
I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that.
Can you explain why you believe this? and why you are not concerned that a massive distribution of the OP token will result in a token price that could certainly result in negative tailwinds for Public Goods funding, governance, user activity, and more?
OPUser: I’ve noted in several posts that you are quite dismissive of ideas you do not personally agree with, without providing clear rational or full engagement with contrary arguments.
Thank you for the feedback and I would love to extend my thoughts, could you please share the link.
Why will Delegates voting on individual protocol’s proposals cause bias?
If I have stake in Project X, I would choose to abstain from their proposal in GF round. This is how in general voting works, its nothing new.
Can you please provide evidence for this assumption?
Its not assumption, I am simply quoting what mentioned in project proposal.
Again, choose not to comment on anything price related.
Couple of points: 36 M that was distributed in Phase 0 was for liquidity and user on-boarding s…
Couple of points: 36 M that was distributed in Phase 0 was for liquidity and user on-boarding so I dont see a problem if those token are sold out or dumped. That was their sole purpose, on board liquidity according to their proposal Yes, this assumption is wrong. If we assume the ~ 40 mm distributed OP to be sold evenly over the next six months, we’re looking at 6 . 7 mm OP sell pressure – two thirds of all the OP in liquidity pools – every month. Not all of the token will be sold, token distribution plan from their proposal is from 6 - 24 months and few of them are not using their token as an LP reward, so token distribution will be gradual. This is nice idea but will not work Delegates can now vote not just on Optimism-specific proposals but also on individual protocols’ proposals It will cause bias, if I have a say in project X and they submit a proposal here on GF fund, only option for me to abstain from discussion. This will work out just fine on organizational and/or project level, just as you mentioned below Velodrome took the initiative to grant Optimism 5 % of our initial token share. This has proven to be one of our best decisions yet And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias. We are mixing two things here, price of OP and Public Good. why we have OP the token in the first place For public good we have dedicated 20 % fund and its distribution is based on different logic which I am really excited about. We suggest that new grants be frozen until we consider this proposal Again, in my opinion, this we should not do. Pausing will only hurt our progress we have made so far. Few point because this proposal is mixing couple of things. In Phase 1 , we are not just focusing on LP, we are also looking into user on boarding via different approach, application migration and integration, marketing and even development support if idea is unique. Now we are asking projects to submit KPI based proposal if its based on LP incentives and we are working on making sure that its sustainable, long term. Again, opinion varies according to delegate but from what I see, we are looking beyond just LP. This seems to be focused on price of token with a mask of public good. We should keep them separate. Personally, I dont see a proposal if token are being dumped as long the reason is justified in their proposal. Again, depends on proposal. At the end of day, 1 OP will always has 1 voting power as it should be, after all its a Gov token. If you feel project proposal need improvement, join us and help us improve it. Pausing will not help but asking question and providing feedback to project proposal will. I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal. I want to mention few things. We have an excellent gov model(token house and citizen house) which motivated me to join this gov and I think, it need feedback and suggestion. We are in dire need of community engagement, if i look at the stats on this forum, user involvement are going down each passing day. What can we do for that ?Last voting cycle, we had 17 M vote count on proposal. I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that. Again, I might be in minority here, liquidity is not “critical” problem here but lack on user involvement is. Resolving bias is another concern but that need a separate thread. We have few thoughts and thread going on to improve overall gov process. Please join us there. Economic sustainability ideas for $OP ? Ideas & Feedback Starting from first principles, this is my opinion for how $OP can be economically sustainable. My general philosophy is elegance, simplicity and minimal friction. No lockups, staking rewards and similar mechanisms - $OP will always be a frictionless, liquid token. Revenues Assuming a MEVA/PBS-like setup, builders (sequencers) bid in ETH. Note: depending on the implementation, users may pay fees in other tokens (e.g. OP, DAI) to dapps/builders, but this is abstracted away from Optimism Collect… Solving voter apathy ? Ideas & Feedback In the last round, only ~ 12 % of circulating supply voted for proposals. We now have a single delegate that can pretty much override the entirety of active governance (effectively, a 51 % attack on Optimism Collective). We are seeing many token holders not delegate at all, or delegate to inactive delegates. We have seen this be an issue with proof-of-stake chains. They solve this by basically bribing token holders to delegate their stake. A better way would be sharing sequencer revenues with dele… Incentivizing effort from governance participants with retroactive rewards for good decisions Rules and process There is a general problem in DAOs of low participation in governance votes. Some DAO’s offer POAPs to Snapshot voters to encourage more voters, but while this increases the number of participants it does not necessarily increase the number of useful participants. What we want is a way to get people to apply more effort into their voting decisions, thus increasing the likelihood of a better outcome. From reading discord chats there are certainly those who’s priority becomes obtaining the voting… Update of the PHASE 1 protocol nomination template ? Ideas & Feedback This is a joint collaboration of: @OPUser (delegate), @Netrim @NicoEsp @DeFi_LATAM_Joxes @AxlVaz (DeFi Latam & Optimism Español [no oficial]) If I am missing the name of any contributor, please let me know. Summary Noting the number of proposals and consultations made by the delegates to the proponents. We request, along with other delegates and government members, this modification to the application template. So that projects/protocols/proponents can more robustly and strongly… What is Public Good to You ? Ideas & Feedback If you are active here and/or on discord, you might have seen some discussion on Public Good. I have been thinking about it and in last few days, after reading, learning and discussion within my circle, my definition of Public Good has changed a lot. I have came to realization that its scope is much bigger than I initially thought and when we add RPGF to it, its gets more complex. What is public good. By definition public good can be anything that has two properties, non-rivel in consumption …
gabagool: OPUser:
I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal.
Wanted to make a comment not about the discussion here, but about your manner of discussion.
I’ve noted in several posts that you are quite dismissive of ideas you do not personally agree with, without providing clear rational or full engagement with contrary arguments.
You are not worried about token price, and do not think token price is connected to governance activity. Does that make these opinions true?
Why is liquidity not a crucial problem? How are you defining liquidity?
Why will Delegates voting on individual protocol’s proposals cause bias? Why should you abstain from a governance discussion or vote when a protocol submits to OP if you also participated in a governance discussion or vote on that individual protocol? Being a delegate somewhere should not curtail ANYONE from participating in governance elsewhere. This is core to the entire ethos of decentralization and autonomy.
You claim that “this assumption is wrong” re: the distributed grant OP being sold evenly over the next six months. First of all, be acknowledge that this is a hypothetical, but offer no clear numbers on how many protocols are using OP as Lp rewards. What makes YOUR assumption that “token distribution will be gradual” accurate? Can you please provide evidence for this assumption?
This proposal emerged out of a comprehensive review of every single grant proposal submitted to OP, and was also discussed prior to publication with members of the OP team itself.
OPUser:
And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias.
We are mixing two things here, price of OP and Public Good.
That is right, because they are mixed. Tokens have both economic value and governance value, and the very “public good funding” that the OP token is being used for DEPENDS on token value. No public good’s funding without the token having economic value.
OPUser:
we are also looking into user on boarding
This entire proposal is core to user onboarding. Maintaining economic value of $OP is fundamental to attracting new users to Optimism.
OPUser:
I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that.
Can you explain why you believe this? and why you are not concerned that a massive distribution of the OP token will result in a token price that could certainly result in negative tailwinds for Public Goods funding, governance, user activity, and more?
jackanorak: We were excited to hear OPUser’s thoughts due to their thoughtful feedback on our current draft proposal. We intend to clear up the entirety of their concerns voiced here, most of which we believe merely require some clarification.
36M that was distributed in Phase 0 was for liquidity and user on-boarding so I dont see a problem if those token are sold out or dumped. That was their sole purpose, on board liquidity according to their proposal
Yes, this assumption is wrong.
We made no value claims about where the tokens were going, just observing that for 99% of all tokens being distributed, the ultimate recipient is likely someone who is unmotivated to hold OP vs market selling it. Of course there’s nothing wrong with paying people to LP, use, or build on your product! Velodrome ourselves are using our grant for the same purposes – because these are things that protocols need. This is why we believe protocols have good reason to opt into our proposal, which addresses liquidity, by far the most requested need, and prolongs the efficacy of these programs.
That Governance is fine with using OP for these purposes doesn’t make it less unsustainable, which is our claim.
Not all of the token will be sold, token distribution plan from their proposal is from 6-24 months and few of them are not using their token as an LP reward, so token distribution will be gradual.
Going through the individual approved applications, we saw the distribution being heavily stacked toward the 6-12 month horizon. We certainly can provide supporting data if this is enough of a sticking point.
But even if tokens were distributed equally over 18 months (which is VERY generous); you’d still see unmitigated sell pressure of roughly a quarter of all LP’ed tokens each month. By the time the 6th month came around, the value of the grant would likely be a small fraction of what it would have been if spent at the start. Some GF proposals have already asked for an inflated amount of tokens, claiming they are anticipating this fact!
One thing we didn’t cover in our proposal would be that this observed sell pressure will heavily encourage front-loading of distributions by partner protocols, as they will stand to be better off using their tokens now and risk missing out on future grants than comply with expectations to get a second distribution worth a small fraction of the first.
It will cause bias, if I have a say in project X and they submit a proposal here on GF fund, only option for me to abstain from discussion.
This will work out just fine on organizational and/or project level, just as you mentioned below
If you believe that the Optimism Collective’s ownership of project governance tokens would bias your personal decisions, either you have graver concerns about the functionality of decentralized governance structures in general – or you (possibly correctly) believe that you, OPUser, individually have outsized influence on the collective, such that you can sway things for your personal benefit, which would naturally be problematic from a decentralization standpoint.
Separately, how would this structure be more problematic than an individual personally owning a large stake in project X and thus being conflicted — which of course is almost certainly the case for many delegates and perhaps something unavoidable?
To be honest, we believe this feature is the most exciting thing for committed delegates, as it reflects in our view a compelling experimentation around decentralized governance (and capitalism) – a collective stake in participating organizations.
This is nice idea but will not work
This opinion, on the other hand, in response to our data- and experience-driven proposal, has no support. Why not share your bias against this? Pretty sure we can address any material concerns you may have.
And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias.
Why would this be the case? Spell out exactly how they’d be biased. Is it because you think this benefits Velodrome? Note that nowhere do we mention Velodrome as a place to LP tokens; that is up to the OP Collective. If this is why you are concerned, do you believe that their small stake in Velodrome is enough to materially sway their interests?
There are many fantastic places to LP tokens, each with its benefits. Uni naturally has unique strengths, Beethoven’s well known for its farming abilities, etc.
And consider the opposite: it is entirely possible that they influenced us to make this proposal for the good of Optimism because, as tokenholders, they have a say in what sorts of communications we put out. And that would be a good thing. [To be clear, though, this proposal was entirely conceived by the Velodrome team.]
If someone from the Foundation were to comment on this, we would expect participants here to see them as people who put the Collective first. We’re genuinely confused at how you could expect otherwise.
We are mixing two things here, price of OP and Public Good.
Of course we are. We recognize the need to paint a veneer of propriety such that we don’t have random tokenholders screeching “but token price”, but until the OP Collective can figure out a way to accrue a material treasury, the token is how we have the ability to fund public goods. What we’re doing is offering a mechanical and governance-driven means of ensuring that this method is sustainable.
Seeing the token go to zero critically hamstrings the Collective’s capability to fund public goods or RFPG, which limits protocols’ capacity to facilitate user/liquidity/protocol onboarding, which lowers the stakes for governance participation, which leads to a death spiral.
We are laying out our concerns with the weight of experience of having seen this play out in several contexts – and, we believe, our expertise, having professionally consulted for protocols (e.g., Redacted) and layers (e.g., Boba) on this very subject, to say nothing of our deep history in complex tokenomics. We are sounding the warning here because not attending to this is a grave mistake. Let’s drop the pearls, people.
Again, in my opinion, this we should not do. Pausing will only hurt our progress we have made so far.
Pausing would prevent OP from multiplying the sell pressure overnight. Can you explain what sort of progress would be stalled in support of this? Why would delaying, say, two weeks have a material impact?
In Phase 1, we are not just focusing on LP, we are also looking into user on boarding via different approach, application migration and integration, marketing and even development support if idea is unique. Now we are asking projects to submit KPI based proposal if its based on LP incentives and we are working on making sure that its sustainable, long term. Again, opinion varies according to delegate but from what I see, we are looking beyond just LP.
As far as we can tell, none of these entails doing anything other than paying somebody OP so they can sell for stables. Would love to see an alternative — so much so that we’ve suggested one!
This seems to be focused on price of token with a mask of public good. We should keep them separate.
Already addressed above, but we’ll emphasize: this is an aesthetic objection to a material concern. The token price is not its own end; it is the sum total of Optimism’s operational capacity.
Moreover, this a rank misreading of our proposal, which is in fact not focused primarily on the token price.
The broader objectives you yourself have raised include participation in governance. Our proposal increases the stakes for governance.
The Constitution calls for experimentation in modes of governance; we’ve outlined in detail a way to dramatically expand the scope of governance.
You provide links to discussions on how to accrue value to governance; we’re not sure what else you can call our proposal.
Personally, I dont see a proposal if token are being dumped as long the reason is justified in their proposal. Again, depends on proposal. At the end of day, 1 OP will always has 1 voting power as it should be, after all its a Gov token.
Again, we’re not making value claims about the intended purpose of these tokens. We’re devising a win-win-win way to sustain these intended uses of the tokens.
For public good we have dedicated 20% fund and its distribution is based on different logic which I am really excited about.
Sure, but again we’re commenting specifically on the current program’s sustainability, on which we’re not picking up any material pushback.
We are in dire need of community engagement, if i look at the stats on this forum, user involvement are going down each passing day. What can we do for that ?Last voting cycle, we had 17M vote count on proposal.
I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that.
You can’t get around the fact that governance participation will pick up when there are higher stakes and modalities to it. Merely accepting the status quo of meting out rapidly depreciating tokens to a few dozen protocols is simply not enough to bring in outside participation, and tech updates will of course do precious little to affect that. But because we have a vested interest in making sure Optimism thrives, we will certainly do our part.
We have few thoughts and thread going on to improve overall gov process. Please join us there.
Sure, we’re happy to explain how this proposal would address all of these concerns. We’d actually considered doing this already. We’ll consider this your active encouragement to do so.
I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal.
You might be, but we hope others reading can critically evaluate this on its merits. It would indeed be a concerning thing for governance if participation is so low that OPUser’s opposition is enough to stall what we believe is the first immediately actionable way to address an imminent threat to Governance’s power to satisfy one of its core mandates.
Nonetheless, this is the only change you’ve convinced us to make in our proposal, if only because we want to encourage more discussion (and clear up some particulars) before finalizing, and marking it as READY may have discouraged that.
We are encouraging readers and delegates to think bigger; we want Optimism to grow up and meet its potential, and to do so we must be receptive to experimentation, especially when there is a sound thesis and solid support behind it.
Couple of points: 36 M that was distributed in Phase 0 was for liquidity and user on-boarding s…
Couple of points: 36 M that was distributed in Phase 0 was for liquidity and user on-boarding so I dont see a problem if those token are sold out or dumped. That was their sole purpose, on board liquidity according to their proposal Yes, this assumption is wrong. If we assume the ~ 40 mm distributed OP to be sold evenly over the next six months, we’re looking at 6 . 7 mm OP sell pressure – two thirds of all the OP in liquidity pools – every month. Not all of the token will be sold, token distribution plan from their proposal is from 6 - 24 months and few of them are not using their token as an LP reward, so token distribution will be gradual. This is nice idea but will not work Delegates can now vote not just on Optimism-specific proposals but also on individual protocols’ proposals It will cause bias, if I have a say in project X and they submit a proposal here on GF fund, only option for me to abstain from discussion. This will work out just fine on organizational and/or project level, just as you mentioned below Velodrome took the initiative to grant Optimism 5 % of our initial token share. This has proven to be one of our best decisions yet And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias. We are mixing two things here, price of OP and Public Good. why we have OP the token in the first place For public good we have dedicated 20 % fund and its distribution is based on different logic which I am really excited about. We suggest that new grants be frozen until we consider this proposal Again, in my opinion, this we should not do. Pausing will only hurt our progress we have made so far. Few point because this proposal is mixing couple of things. In Phase 1 , we are not just focusing on LP, we are also looking into user on boarding via different approach, application migration and integration, marketing and even development support if idea is unique. Now we are asking projects to submit KPI based proposal if its based on LP incentives and we are working on making sure that its sustainable, long term. Again, opinion varies according to delegate but from what I see, we are looking beyond just LP. This seems to be focused on price of token with a mask of public good. We should keep them separate. Personally, I dont see a proposal if token are being dumped as long the reason is justified in their proposal. Again, depends on proposal. At the end of day, 1 OP will always has 1 voting power as it should be, after all its a Gov token. If you feel project proposal need improvement, join us and help us improve it. Pausing will not help but asking question and providing feedback to project proposal will. I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal. I want to mention few things. We have an excellent gov model(token house and citizen house) which motivated me to join this gov and I think, it need feedback and suggestion. We are in dire need of community engagement, if i look at the stats on this forum, user involvement are going down each passing day. What can we do for that ?Last voting cycle, we had 17 M vote count on proposal. I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that. Again, I might be in minority here, liquidity is not “critical” problem here but lack on user involvement is. Resolving bias is another concern but that need a separate thread. We have few thoughts and thread going on to improve overall gov process. Please join us there. Economic sustainability ideas for $OP Starting from first principles, this is my opinion for how $OP can be economically sustainable. My general philosophy is elegance, simplicity and minimal friction. No lockups, staking rewards and similar mechanisms - $OP will always be a frictionless, liquid token. Revenues Assuming a MEVA/PBS-like setup, builders (sequencers) bid in ETH. Note: depending on the implementation, users may pay fees in other tokens (e.g. OP, DAI) to dapps/builders, but this is abstracted away from Optimism Collect… Solving voter apathy In the last round, only ~ 12 % of circulating supply voted for proposals. We now have a single delegate that can pretty much override the entirety of active governance (effectively, a 51 % attack on Optimism Collective). We are seeing many token holders not delegate at all, or delegate to inactive delegates. We have seen this be an issue with proof-of-stake chains. They solve this by basically bribing token holders to delegate their stake. A better way would be sharing sequencer revenues with dele… Incentivizing effort from governance participants with retroactive rewards for good decisions ? Token House Governance There is a general problem in DAOs of low participation in governance votes. Some DAO’s offer POAPs to Snapshot voters to encourage more voters, but while this increases the number of participants it does not necessarily increase the number of useful participants. What we want is a way to get people to apply more effort into their voting decisions, thus increasing the likelihood of a better outcome. From reading discord chats there are certainly those who’s priority becomes obtaining the voting… Update of the PHASE 1 protocol nomination template This is a joint collaboration of: @OPUser (delegate), @Netrim @NicoProducto @Joxes @AxlVaz (DeFi Latam & Optimism Español [no oficial]) If I am missing the name of any contributor, please let me know. Summary Noting the number of proposals and consultations made by the delegates to the proponents. We request, along with other delegates and government members, this modification to the application template. So that projects/protocols/proponents can more robustly and strongly articulate the a… What is Public Good to You If you are active here and/or on discord, you might have seen some discussion on Public Good. I have been thinking about it and in last few days, after reading, learning and discussion within my circle, my definition of Public Good has changed a lot. I have came to realization that its scope is much bigger than I initially thought and when we add RPGF to it, its gets more complex. What is public good. By definition public good can be anything that has two properties, non-rivel in consumption …
gabagool: OPUser:
I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal.
Wanted to make a comment not about the discussion here, but about your manner of discussion.
I’ve noted in several posts that you are quite dismissive of ideas you do not personally agree with, without providing clear rational or full engagement with contrary arguments.
You are not worried about token price, and do not think token price is connected to governance activity. Does that make these opinions true?
Why is liquidity not a crucial problem? How are you defining liquidity?
Why will Delegates voting on individual protocol’s proposals cause bias? Why should you abstain from a governance discussion or vote when a protocol submits to OP if you also participated in a governance discussion or vote on that individual protocol? Being a delegate somewhere should not curtail ANYONE from participating in governance elsewhere. This is core to the entire ethos of decentralization and autonomy.
You claim that “this assumption is wrong” re: the distributed grant OP being sold evenly over the next six months. First of all, be acknowledge that this is a hypothetical, but offer no clear numbers on how many protocols are using OP as Lp rewards. What makes YOUR assumption that “token distribution will be gradual” accurate? Can you please provide evidence for this assumption?
This proposal emerged out of a comprehensive review of every single grant proposal submitted to OP, and was also discussed prior to publication with members of the OP team itself.
OPUser:
And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias.
We are mixing two things here, price of OP and Public Good.
That is right, because they are mixed. Tokens have both economic value and governance value, and the very “public good funding” that the OP token is being used for DEPENDS on token value. No public good’s funding without the token having economic value.
OPUser:
we are also looking into user on boarding
This entire proposal is core to user onboarding. Maintaining economic value of $OP is fundamental to attracting new users to Optimism.
OPUser:
I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that.
Can you explain why you believe this? and why you are not concerned that a massive distribution of the OP token will result in a token price that could certainly result in negative tailwinds for Public Goods funding, governance, user activity, and more?
jackanorak: We were excited to hear OPUser’s thoughts due to their thoughtful feedback on our current draft proposal. We intend to clear up the entirety of their concerns voiced here, most of which we believe merely require some clarification.
36M that was distributed in Phase 0 was for liquidity and user on-boarding so I dont see a problem if those token are sold out or dumped. That was their sole purpose, on board liquidity according to their proposal
Yes, this assumption is wrong.
We made no value claims about where the tokens were going, just observing that for 99% of all tokens being distributed, the ultimate recipient is likely someone who is unmotivated to hold OP vs market selling it. Of course there’s nothing wrong with paying people to LP, use, or build on your product! Velodrome ourselves are using our grant for the same purposes – because these are things that protocols need. This is why we believe protocols have good reason to opt into our proposal, which addresses liquidity, by far the most requested need, and prolongs the efficacy of these programs.
That Governance is fine with using OP for these purposes doesn’t make it less unsustainable, which is our claim.
Not all of the token will be sold, token distribution plan from their proposal is from 6-24 months and few of them are not using their token as an LP reward, so token distribution will be gradual.
Going through the individual approved applications, we saw the distribution being heavily stacked toward the 6-12 month horizon. We certainly can provide supporting data if this is enough of a sticking point.
But even if tokens were distributed equally over 18 months (which is VERY generous); you’d still see unmitigated sell pressure of roughly a quarter of all LP’ed tokens each month. By the time the 6th month came around, the value of the grant would likely be a small fraction of what it would have been if spent at the start. Some GF proposals have already asked for an inflated amount of tokens, claiming they are anticipating this fact!
One thing we didn’t cover in our proposal would be that this observed sell pressure will heavily encourage front-loading of distributions by partner protocols, as they will stand to be better off using their tokens now and risk missing out on future grants than comply with expectations to get a second distribution worth a small fraction of the first.
It will cause bias, if I have a say in project X and they submit a proposal here on GF fund, only option for me to abstain from discussion.
This will work out just fine on organizational and/or project level, just as you mentioned below
If you believe that the Optimism Collective’s ownership of project governance tokens would bias your personal decisions, either you have graver concerns about the functionality of decentralized governance structures in general – or you (possibly correctly) believe that you, OPUser, individually have outsized influence on the collective, such that you can sway things for your personal benefit, which would naturally be problematic from a decentralization standpoint.
Separately, how would this structure be more problematic than an individual personally owning a large stake in project X and thus being conflicted — which of course is almost certainly the case for many delegates and perhaps something unavoidable?
To be honest, we believe this feature is the most exciting thing for committed delegates, as it reflects in our view a compelling experimentation around decentralized governance (and capitalism) – a collective stake in participating organizations.
This is nice idea but will not work
This opinion, on the other hand, in response to our data- and experience-driven proposal, has no support. Why not share your bias against this? Pretty sure we can address any material concerns you may have.
And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias.
Why would this be the case? Spell out exactly how they’d be biased. Is it because you think this benefits Velodrome? Note that nowhere do we mention Velodrome as a place to LP tokens; that is up to the OP Collective. If this is why you are concerned, do you believe that their small stake in Velodrome is enough to materially sway their interests?
There are many fantastic places to LP tokens, each with its benefits. Uni naturally has unique strengths, Beethoven’s well known for its farming abilities, etc.
And consider the opposite: it is entirely possible that they influenced us to make this proposal for the good of Optimism because, as tokenholders, they have a say in what sorts of communications we put out. And that would be a good thing. [To be clear, though, this proposal was entirely conceived by the Velodrome team.]
If someone from the Foundation were to comment on this, we would expect participants here to see them as people who put the Collective first. We’re genuinely confused at how you could expect otherwise.
We are mixing two things here, price of OP and Public Good.
Of course we are. We recognize the need to paint a veneer of propriety such that we don’t have random tokenholders screeching “but token price”, but until the OP Collective can figure out a way to accrue a material treasury, the token is how we have the ability to fund public goods. What we’re doing is offering a mechanical and governance-driven means of ensuring that this method is sustainable.
Seeing the token go to zero critically hamstrings the Collective’s capability to fund public goods or RFPG, which limits protocols’ capacity to facilitate user/liquidity/protocol onboarding, which lowers the stakes for governance participation, which leads to a death spiral.
We are laying out our concerns with the weight of experience of having seen this play out in several contexts – and, we believe, our expertise, having professionally consulted for protocols (e.g., Redacted) and layers (e.g., Boba) on this very subject, to say nothing of our deep history in complex tokenomics. We are sounding the warning here because not attending to this is a grave mistake. Let’s drop the pearls, people.
Again, in my opinion, this we should not do. Pausing will only hurt our progress we have made so far.
Pausing would prevent OP from multiplying the sell pressure overnight. Can you explain what sort of progress would be stalled in support of this? Why would delaying, say, two weeks have a material impact?
In Phase 1, we are not just focusing on LP, we are also looking into user on boarding via different approach, application migration and integration, marketing and even development support if idea is unique. Now we are asking projects to submit KPI based proposal if its based on LP incentives and we are working on making sure that its sustainable, long term. Again, opinion varies according to delegate but from what I see, we are looking beyond just LP.
As far as we can tell, none of these entails doing anything other than paying somebody OP so they can sell for stables. Would love to see an alternative — so much so that we’ve suggested one!
This seems to be focused on price of token with a mask of public good. We should keep them separate.
Already addressed above, but we’ll emphasize: this is an aesthetic objection to a material concern. The token price is not its own end; it is the sum total of Optimism’s operational capacity.
Moreover, this a rank misreading of our proposal, which is in fact not focused primarily on the token price.
The broader objectives you yourself have raised include participation in governance. Our proposal increases the stakes for governance.
The Constitution calls for experimentation in modes of governance; we’ve outlined in detail a way to dramatically expand the scope of governance.
You provide links to discussions on how to accrue value to governance; we’re not sure what else you can call our proposal.
Personally, I dont see a proposal if token are being dumped as long the reason is justified in their proposal. Again, depends on proposal. At the end of day, 1 OP will always has 1 voting power as it should be, after all its a Gov token.
Again, we’re not making value claims about the intended purpose of these tokens. We’re devising a win-win-win way to sustain these intended uses of the tokens.
For public good we have dedicated 20% fund and its distribution is based on different logic which I am really excited about.
Sure, but again we’re commenting specifically on the current program’s sustainability, on which we’re not picking up any material pushback.
We are in dire need of community engagement, if i look at the stats on this forum, user involvement are going down each passing day. What can we do for that ?Last voting cycle, we had 17M vote count on proposal.
I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that.
You can’t get around the fact that governance participation will pick up when there are higher stakes and modalities to it. Merely accepting the status quo of meting out rapidly depreciating tokens to a few dozen protocols is simply not enough to bring in outside participation, and tech updates will of course do precious little to affect that. But because we have a vested interest in making sure Optimism thrives, we will certainly do our part.
We have few thoughts and thread going on to improve overall gov process. Please join us there.
Sure, we’re happy to explain how this proposal would address all of these concerns. We’d actually considered doing this already. We’ll consider this your active encouragement to do so.
I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal.
You might be, but we hope others reading can critically evaluate this on its merits. It would indeed be a concerning thing for governance if participation is so low that OPUser’s opposition is enough to stall what we believe is the first immediately actionable way to address an imminent threat to Governance’s power to satisfy one of its core mandates.
Nonetheless, this is the only change you’ve convinced us to make in our proposal, if only because we want to encourage more discussion (and clear up some particulars) before finalizing, and marking it as READY may have discouraged that.
We are encouraging readers and delegates to think bigger; we want Optimism to grow up and meet its potential, and to do so we must be receptive to experimentation, especially when there is a sound thesis and solid support behind it.
We were excited to hear OPUser’s thoughts due to their thoughtful feedback on our current draft pro…
We were excited to hear OPUser’s thoughts due to their thoughtful feedback on our current draft proposal. We intend to clear up the entirety of their concerns voiced here, most of which we believe merely require some clarification.
36 M that was distributed in Phase 0 was for liquidity and user on-boarding so I dont see a problem if those token are sold out or dumped. That was their sole purpose, on board liquidity according to their proposal
Yes, this assumption is wrong.
We made no value claims about where the tokens were going, just observing that for 99 % of all tokens being distributed, the ultimate recipient is likely someone who is unmotivated to hold OP vs market selling it. Of course there’s nothing wrong with paying people to LP, use, or build on your product! Velodrome ourselves are using our grant for the same purposes – because these are things that protocols need. This is why we believe protocols have good reason to opt into our proposal, which addresses liquidity, by far the most requested need, and prolongs the efficacy of these programs.
That Governance is fine with using OP for these purposes doesn’t make it less unsustainable, which is our claim.
Not all of the token will be sold, token distribution plan from their proposal is from 6 - 24 months and few of them are not using their token as an LP reward, so token distribution will be gradual.
Going through the individual approved applications, we saw the distribution being heavily stacked toward the 6 - 12 month horizon. We certainly can provide supporting data if this is enough of a sticking point.
But even if tokens were distributed equally over 18 months (which is VERY generous); you’d still see unmitigated sell pressure of roughly a quarter of all LP’ed tokens each month. By the time the 6 th month came around, the value of the grant would likely be a small fraction of what it would have been if spent at the start. Some GF proposals have already asked for an inflated amount of tokens, claiming they are anticipating this fact!
One thing we didn’t cover in our proposal would be that this observed sell pressure will heavily encourage front-loading of distributions by partner protocols, as they will stand to be better off using their tokens now and risk missing out on future grants than comply with expectations to get a second distribution worth a small fraction of the first.
It will cause bias, if I have a say in project X and they submit a proposal here on GF fund, only option for me to abstain from discussion.
This will work out just fine on organizational and/or project level, just as you mentioned below
If you believe that the Optimism Collective’s ownership of project governance tokens would bias your personal decisions, either you have graver concerns about the functionality of decentralized governance structures in general – or you (possibly correctly) believe that you, OPUser, individually have outsized influence on the collective, such that you can sway things for your personal benefit, which would naturally be problematic from a decentralization standpoint.
Separately, how would this structure be more problematic than an individual personally owning a large stake in project X and thus being conflicted — which of course is almost certainly the case for many delegates and perhaps something unavoidable?
To be honest, we believe this feature is the most exciting thing for committed delegates, as it reflects in our view a compelling experimentation around decentralized governance (and capitalism) – a collective stake in participating organizations.
This is nice idea but will not work
This opinion, on the other hand, in response to our data- and experience-driven proposal, has no support. Why not share your bias against this? Pretty sure we can address any material concerns you may have.
And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias.
Why would this be the case? Spell out exactly how they’d be biased. Is it because you think this benefits Velodrome? Note that nowhere do we mention Velodrome as a place to LP tokens; that is up to the OP Collective. If this is why you are concerned, do you believe that their small stake in Velodrome is enough to materially sway their interests?
There are many fantastic places to LP tokens, each with its benefits. Uni naturally has unique strengths, Beethoven’s well known for its farming abilities, etc.
And consider the opposite: it is entirely possible that they influenced us to make this proposal for the good of Optimism because, as tokenholders, they have a say in what sorts of communications we put out. And that would be a good thing. [To be clear, though, this proposal was entirely conceived by the Velodrome team.]
If someone from the Foundation were to comment on this, we would expect participants here to see them as people who put the Collective first. We’re genuinely confused at how you could expect otherwise.
We are mixing two things here, price of OP and Public Good.
Of course we are. We recognize the need to paint a veneer of propriety such that we don’t have random tokenholders screeching “but token price”, but until the OP Collective can figure out a way to accrue a material treasury, the token is how we have the ability to fund public goods. What we’re doing is offering a mechanical and governance-driven means of ensuring that this method is sustainable.
Seeing the token go to zero critically hamstrings the Collective’s capability to fund public goods or RFPG, which limits protocols’ capacity to facilitate user/liquidity/protocol onboarding, which lowers the stakes for governance participation, which leads to a death spiral.
We are laying out our concerns with the weight of experience of having seen this play out in several contexts – and, we believe, our expertise, having professionally consulted for protocols (e.g., Redacted) and layers (e.g., Boba) on this very subject, to say nothing of our deep history in complex tokenomics. We are sounding the warning here because not attending to this is a grave mistake. Let’s drop the pearls, people.
Again, in my opinion, this we should not do. Pausing will only hurt our progress we have made so far.
Pausing would prevent OP from multiplying the sell pressure overnight. Can you explain what sort of progress would be stalled in support of this? Why would delaying, say, two weeks have a material impact?
In Phase 1 , we are not just focusing on LP, we are also looking into user on boarding via different approach, application migration and integration, marketing and even development support if idea is unique. Now we are asking projects to submit KPI based proposal if its based on LP incentives and we are working on making sure that its sustainable, long term. Again, opinion varies according to delegate but from what I see, we are looking beyond just LP.
As far as we can tell, none of these entails doing anything other than paying somebody OP so they can sell for stables. Would love to see an alternative — so much so that we’ve suggested one!
This seems to be focused on price of token with a mask of public good. We should keep them separate.
Already addressed above, but we’ll emphasize: this is an aesthetic objection to a material concern. The token price is not its own end; it is the sum total of Optimism’s operational capacity.
Moreover, this a rank misreading of our proposal, which is in fact not focused primarily on the token price.
The broader objectives you yourself have raised include participation in governance. Our proposal increases the stakes for governance.
The Constitution calls for experimentation in modes of governance; we’ve outlined in detail a way to dramatically expand the scope of governance.
You provide links to discussions on how to accrue value to governance; we’re not sure what else you can call our proposal.
Personally, I dont see a proposal if token are being dumped as long the reason is justified in their proposal. Again, depends on proposal. At the end of day, 1 OP will always has 1 voting power as it should be, after all its a Gov token.
Again, we’re not making value claims about the intended purpose of these tokens. We’re devising a win-win-win way to sustain these intended uses of the tokens.
For public good we have dedicated 20 % fund and its distribution is based on different logic which I am really excited about.
Sure, but again we’re commenting specifically on the current program’s sustainability, on which we’re not picking up any material pushback.
We are in dire need of community engagement, if i look at the stats on this forum, user involvement are going down each passing day. What can we do for that ?Last voting cycle, we had 17 M vote count on proposal.
I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that.
You can’t get around the fact that governance participation will pick up when there are higher stakes and modalities to it. Merely accepting the status quo of meting out rapidly depreciating tokens to a few dozen protocols is simply not enough to bring in outside participation, and tech updates will of course do precious little to affect that. But because we have a vested interest in making sure Optimism thrives, we will certainly do our part.
We have few thoughts and thread going on to improve overall gov process. Please join us there.
Sure, we’re happy to explain how this proposal would address all of these concerns. We’d actually considered doing this already. We’ll consider this your active encouragement to do so.
I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal.
You might be, but we hope others reading can critically evaluate this on its merits. It would indeed be a concerning thing for governance if participation is so low that OPUser’s opposition is enough to stall what we believe is the first immediately actionable way to address an imminent threat to Governance’s power to satisfy one of its core mandates.
Nonetheless, this is the only change you’ve convinced us to make in our proposal, if only because we want to encourage more discussion (and clear up some particulars) before finalizing, and marking it as READY may have discouraged that.
We are encouraging readers and delegates to think bigger; we want Optimism to grow up and meet its potential, and to do so we must be receptive to experimentation, especially when there is a sound thesis and solid support behind it.
OPUser: But even if tokens were distributed equally over 18 months (which is VERY generous);
You are right here and I am also looking at how it will turn out, you also know, those funds are already distributed and there no point discussing about it now. All we can do is wait, see and learn from it.
Some GF proposals have already asked for an inflated amount of tokens, claiming they are anticipating this fact!
Again, I agree with you and like I mentioned earlier, best place to point this out is on project proposal so that they can work on it. I have seen, many projects are quite responsive to feedback and willing to amend their proposal.
If you believe that the
It not about me or you, I am talking in general. We had seen this in past voting cycle as well, If an entity has stake in a project, they choose to abstain from their proposal.
Spell out exactly the source of their bias
No, its not about your project or anyone in particular, apologies if my words were not formed properly you get a felling that I am referring to your project. If I have stake in Project X, I would choose to abstain from their proposal in GF round and would expect others too do so if they also have stake in them.
If someone from the Foundation were to comment on this, we would expect participants here to see them as people who put the Collective first.
I see here we have different opinion, from what I understood, GF funds are for token house and users holding token have say in this. Of course, at initial stage OP Foundation can decide to approve or reject it but only when a proposal is approved by token house.
Why would delaying, say, two weeks have a material impact?
2 Weeks would not be a problem, I was thinking a pause for months. Reason being, if we pause for months, there will be many proposal at once which would be hard to judge and manage.
OPUser, individually have outsized influence on the collective
Its quite opposite, I am no one, my knowledge is limited and I still learning about different tools and technology and trying to find my niche. There are few delegate here, far more knowledgeable than me and I look up to them.
I have chosen not to share my view on any comment related to token price.
If I am missing anything here, let me know and i would try to explain it it detail.
For any token incentive program, the most important measure is Emissions over Revenue. Projects alm…
For any token incentive program, the most important measure is Emissions over Revenue. Projects almost always overpay for growth at the beginning ($ 1 of Emissions leads to less than $ 1 of fees), with the goal of flipping that ratio in the future. It’s worth noting that in Optimism’s case, the stated goal for OP incentives is that they not only lead to more transactions (revenue) but also more liquidity and users.
Importantly, none of the Phase 0 programs have started distributing OP, so we cannot really measure this Emissions/Revenue ratio for Optimism.
This also means your OP sell pressure numbers are hypothetical and probably overstated. You assume every single OP token will be sold on the market which is misleading, I think it’s fair to assume at least some amount will be held or staked in liquidity pools.
Backing this claim up with data from another network’s liquidity mining campaign (ex. Polygon or Avalanche) would be helpful. I know that in both cases, native token incentives for dapps led to growth in all of the key areas: transactions, liquidity, and users. And they did this without having the native token collapse from sell pressure.
My biggest problem with the proposal is that it would see the Optimism Treasury take on significant impermanent loss risk. Token pairs with high divergence are more likely to suffer from impermanent loss, and it’s fair to assume OP will continue to be more volatile than say, ETH. Arbitrageurs will rejoice if OP is naively overallocated into constant product AMMs.
While having the Optimism Collective act as meta-governance in the ecosystem might accrue some value to the OP token, I think it would challenge the network’s claim of being credibly neutral. Optimism functions as an extension of Ethereum, and maintaining credible neutrality is a must. Optimism was already accused of showing certain apps favoritism, and this proposal could make things much worse.
jackanorak:
This is unironically true.
Unironically, impermanent loss invalidates the meme. By pairing OP with long tail tokens on AMMs, the Collective would lose value on many of their positions.
jackanorak:
We suggest that new grants be frozen until we consider this proposal.
This is a ridiculous suggestion. The Collective should continue giving grants to projects they believe can convert incentives into more Optimism transactions, liquidity, and users.
Overall, this proposal uses a lot of hyperbole and does not establish itself as clearly better than the OP incentives that dozens of projects are about to kick off, many of which will enhance the OP token’s on-chain liquidity. Pairing OP with new projects’ tokens on AMMs is not “funding public goods”, I hope other readers and delegates see this clearly.
I believe the OP token’s utility will reach maturity only once sequencing/block production is decentralized. This is where it will derive most of its value, and trying to append weird and somewhat risky utility onto it now is a bit short-sighted.
I am not in favor of this proposal and would vote against it.
Disclosure: I am on the Rubicon team. Regardless of how it would impact our protocol, I simply think this is not a wise move for the Collective.
jackanorak: The simple fact that OP would have these coins in the first place vs outright distributing them and thus having nothing invalidates the majority of your objection to the point where we have to wonder whether we expressed our plan clearly enough.
Consider:
Status quo, Optimism distributes 100 OP.
Our proposal, Optimism distributes 75 OP , reserves 25 OP and solicits 25 OP equivalent from partner protocols.
Setting aside the likely farming benefits to offset IL (after all, that is the compensation!), think there’s basic math you’re not seeing here.
Not really sure why you claim hyperbole in the proposal. We’re not saying that the grant program be stopped indefinitely - we consider it a means of prolonging its efficacy.
The fact of your calling it ‘weird’ I think gives your game away. You seek a distant, engineering-led, speculative approach to accrue value when we’re offering something concrete and data-driven that can be done now to meet an imminent need. The fact of expanding and iterating on modes of governance is not ‘weird’ – it’s literally baked into the Working Constitution.
Really unsure how else to respond here other than to reemphasize, this is not a wholesale stand-in for grants; it’s not necessary to use a program such as Avalanche as a counterfactual. We’re talking about changing how protocols get the thing they’re asking for – dex-based liquidity – in a positive-sum way. Even if we suppose that some marginal incentivized liquidity provider would miss out at the start, there remain the same outside incentives (and the same liquidity) to encourage plenty of new users, capital, and development – and, again, with our plan you could be comfortable in the likelihood of being able to prolong existing liquidity mining programs (and start new ones), along with all the others, to continue to bring in this activity.
jackanorak: forrest:
While having the Optimism Collective act as meta-governance in the ecosystem might accrue some value to the OP token, I think it would challenge the network’s claim of being credibly neutral. Optimism functions as an extension of Ethereum, and maintaining credible neutrality is a must. Optimism was already accused of showing certain apps favoritism, and this proposal could make things much worse.
Just realized that we missed this question on an important topic - apologies.
Would hope you’d expand on this thought, as we’ve struggled to find any direct line between our proposal and any sort of loss of credible neutrality. Governance is either neutral or not; what it has governance over ought not to affect neutrality.
If your belief is that simply expanding the purview of governance leads to a loss of neutrality [don’t want to misrepresent tho], that implies the desire for highly limited governance, a view I’d really like to hear explained in light of what’s been posted on the forum to date.
The simple fact that OP would have these coins in the first place vs outright distributing them and…
The simple fact that OP would have these coins in the first place vs outright distributing them and thus having nothing invalidates the majority of your objection to the point where we have to wonder whether we expressed our plan clearly enough.
Consider:
Status quo, Optimism distributes 100 OP.
Our proposal, Optimism distributes 75 OP , reserves 25 OP and solicits 25 OP equivalent from partner protocols.
Setting aside the likely farming benefits to offset IL (after all, that is the compensation!), think there’s basic math you’re not seeing here.
Not really sure why you claim hyperbole in the proposal. We’re not saying that the grant program be stopped indefinitely - we consider it a means of prolonging its efficacy.
The fact of your calling it ‘weird’ I think gives your game away. You seek a distant, engineering-led, speculative approach to accrue value when we’re offering something concrete and data-driven that can be done now to meet an imminent need. The fact of expanding and iterating on modes of governance is not ‘weird’ – it’s literally baked into the Working Constitution.
Really unsure how else to respond here other than to reemphasize, this is not a wholesale stand-in for grants; it’s not necessary to use a program such as Avalanche as a counterfactual. We’re talking about changing how protocols get the thing they’re asking for – dex-based liquidity – in a positive-sum way. Even if we suppose that some marginal incentivized liquidity provider would miss out at the start, there remain the same outside incentives (and the same liquidity) to encourage plenty of new users, capital, and development – and, again, with our plan you could be comfortable in the likelihood of being able to prolong existing liquidity mining programs (and start new ones), along with all the others, to continue to bring in this activity.
forrest: jackanorak:
having nothing
Again, their stated goal here is more transactions, users, and liquidity, which I think the current program is on track to accomplish. Optimism does get something out of these incentives. I am arguing that 25% more incentives to fuel growth in those three metrics is more valuable than incentives for long-tail token liquidity against OP on AMMs that account for less than 30% of Optimism DEX volumes.
jackanorak:
a distant, engineering-led, speculative approach to accrue value when we’re offering something concrete and data-driven that can be done now to meet an imminent need.
So a network’s token accruing value from block production is “speculative” but pairing the token with long tail assets in constant product AMMs is “concrete” and “data-driven”. Gotcha. Could not disagree more. There is way more value for OP in block production than there is in “partnerships”.
jackanorak:
it’s not necessary to use a program such as Avalanche as a counterfactual.
Why not? Those incentive programs grew their respective network in all of Optimism’s target metrics. They are great comparables and I am not sure why you want to dismiss them.
I guess I do not feel the urgency you do or see this “imminent” need for utility. Incentives are about to kick off on almost all Optimism apps and Bedrock will be online later this year. I don’t buy the theory of the coming OP liquidity crisis, and as I mentioned, you did use unrealistic estimates.
Also, I want to see the Optimism Collective do governance experiments, I just think this is a bad one! And I see hyperbole throughout the proposal, not just the suggestion that grants should stop.
OPUser: jackanorak:
reserves 25 OP and solicits 25 OP equivalent from partner protocols.
Could you please help me with this example:
reserves 25 OP : who will get this and what would be its purpose, same question for 25 equivalent from partner
But even if tokens were distributed equally over 18 months (which is VERY generous);
You are ri…
But even if tokens were distributed equally over 18 months (which is VERY generous);
You are right here and I am also looking at how it will turn out, you also know, those funds are already distributed and there no point discussing about it now. All we can do is wait, see and learn from it.
Some GF proposals have already asked for an inflated amount of tokens, claiming they are anticipating this fact!
Again, I agree with you and like I mentioned earlier, best place to point this out is on project proposal so that they can work on it. I have seen, many projects are quite responsive to feedback and willing to amend their proposal.
If you believe that the
It not about me or you, I am talking in general. We had seen this in past voting cycle as well, If an entity has stake in a project, they choose to abstain from their proposal.
Spell out exactly the source of their bias
No, its not about your project or anyone in particular, apologies if my words were not formed properly you get a felling that I am referring to your project. If I have stake in Project X, I would choose to abstain from their proposal in GF round and would expect others too do so if they also have stake in them.
If someone from the Foundation were to comment on this, we would expect participants here to see them as people who put the Collective first.
I see here we have different opinion, from what I understood, GF funds are for token house and users holding token have say in this. Of course, at initial stage OP Foundation can decide to approve or reject it but only when a proposal is approved by token house.
Why would delaying, say, two weeks have a material impact?
2 Weeks would not be a problem, I was thinking a pause for months. Reason being, if we pause for months, there will be many proposal at once which would be hard to judge and manage.
OPUser, individually have outsized influence on the collective
Its quite opposite, I am no one, my knowledge is limited and I still learning about different tools and technology and trying to find my niche. There are few delegate here, far more knowledgeable than me and I look up to them.
I have chosen not to share my view on any comment related to token price.
If I am missing anything here, let me know and i would try to explain it it detail.
jackanorak: Jack here. Many thanks for the considerate reply. Will respond per item.
You are right here and I am also looking at how it will turn out, you also know, those funds are already distributed and there no point discussing about it now. All we can do is wait, see and learn from it.
Yes, absolutely. The last batch was intended as a demonstration to provide a sense of scale. Of relevance is the next batch (and so on), which is why we were asking to hold off on this series of grants, just for a week or two, to consider this proposal.
We’ve submitted this proposal as a team, but I would volunteer to dedicate myself solely to this project to make sure we could get to consensus quickly enough to continue rewards.
Again, I agree with you and like I mentioned earlier, best place to point this out is on project proposal so that they can work on it. I have seen, many projects are quite responsive to feedback and willing to amend their proposal.
We can def do more of this – but it’s addressing the symptom and not the cause. Our proposal intends to remove that kind of guesswork altogether.
It not about me or you, I am talking in general. We had seen this in past voting cycle as well, If an entity has stake in a project, they choose to abstain from their proposal.
If I’m understanding you correctly, you’re saying that delegates with personal stakes in protocols currently abstain from votes where there might be conflicts of interest. I think that’s fine – if fragile – as a means of preventing capture (as we’ve seen in politics).
In any case, what we’re proposing is a step away from these types of conflicts, as the only shift is the addition of governance to firms’ capital bases, not individuals. To say that personal conflicts would enter into it in a more significant way than in the status quo would be to say that governance itself is captured by individuals, which is an entirely different matter (one, incidentally, this proposal is also attempting to address).
I see here we have different opinion, from what I understood, GF funds are for token house and users holding token have say in this. Of course, at initial stage OP Foundation can decide to approve or reject it but only when a proposal is approved by token house.
I think we have the same understanding here. We were just saying that the OP Foundation should have by this point more than demonstrated their commitment to and interest in Optimism’s success as a primary matter.
2 Weeks would not be a problem, I was thinking a pause for months. Reason being, if we pause for months, there will be many proposal at once which would be hard to judge and manage.
Absolutely. In fact I’d be all in favor of proposing a cap on any sort of pause to keep distribution flowing.
I have chosen not to share my view on any comment related to token price.
I don’t want to overstep my bounds here with you, especially because I sympathize with this sentiment (and strictly adhere to it when it comes to Velodrome), but unfortunately in the case of funding public goods, the price is of relevance in that it dictates OP’s ability to do so.
I think we ought to be able to refer to its instrumentality to this end while avoiding the ugly speculative discussion that comes from hyperfocus on it. That is, of course, unless there is some sort of legal/regulatory reason to avoid any sort of mention.
I’ve noted in several posts that you are quite dismissive of ideas you do not personally agree wit…
I’ve noted in several posts that you are quite dismissive of ideas you do not personally agree with, without providing clear rational or full engagement with contrary arguments.
Thank you for the feedback and I would love to extend my thoughts, could you please share the link.
Why will Delegates voting on individual protocol’s proposals cause bias?
If I have stake in Project X, I would choose to abstain from their proposal in GF round. This is how in general voting works, its nothing new.
Can you please provide evidence for this assumption?
Its not assumption, I am simply quoting what mentioned in project proposal.
Again, choose not to comment on anything price related.
gabagool: thanks for your considerate reply, more of a general note on tone.
For example:
OPUser:
I would choose to abstain from their proposal in GF round. This is how in general voting works, its nothing new.
Is this explicitly stated in any of the rules around OP governance or delegation? I cannot find any mention of it, and therefor disagree that this is a norm that should be considered a rule to be followed.
Jack here. Many thanks for the considerate reply. Will respond per item.
You are right here and I …
Jack here. Many thanks for the considerate reply. Will respond per item.
You are right here and I am also looking at how it will turn out, you also know, those funds are already distributed and there no point discussing about it now. All we can do is wait, see and learn from it.
Yes, absolutely. The last batch was intended as a demonstration to provide a sense of scale. Of relevance is the next batch (and so on), which is why we were asking to hold off on this series of grants, just for a week or two, to consider this proposal.
We’ve submitted this proposal as a team, but I would volunteer to dedicate myself solely to this project to make sure we could get to consensus quickly enough to continue rewards.
Again, I agree with you and like I mentioned earlier, best place to point this out is on project proposal so that they can work on it. I have seen, many projects are quite responsive to feedback and willing to amend their proposal.
We can def do more of this – but it’s addressing the symptom and not the cause. Our proposal intends to remove that kind of guesswork altogether.
It not about me or you, I am talking in general. We had seen this in past voting cycle as well, If an entity has stake in a project, they choose to abstain from their proposal.
If I’m understanding you correctly, you’re saying that delegates with personal stakes in protocols currently abstain from votes where there might be conflicts of interest. I think that’s fine – if fragile – as a means of preventing capture (as we’ve seen in politics).
In any case, what we’re proposing is a step away from these types of conflicts, as the only shift is the addition of governance to firms’ capital bases, not individuals. To say that personal conflicts would enter into it in a more significant way than in the status quo would be to say that governance itself is captured by individuals, which is an entirely different matter (one, incidentally, this proposal is also attempting to address).
I see here we have different opinion, from what I understood, GF funds are for token house and users holding token have say in this. Of course, at initial stage OP Foundation can decide to approve or reject it but only when a proposal is approved by token house.
I think we have the same understanding here. We were just saying that the OP Foundation should have by this point more than demonstrated their commitment to and interest in Optimism’s success as a primary matter.
2 Weeks would not be a problem, I was thinking a pause for months. Reason being, if we pause for months, there will be many proposal at once which would be hard to judge and manage.
Absolutely. In fact I’d be all in favor of proposing a cap on any sort of pause to keep distribution flowing.
I have chosen not to share my view on any comment related to token price.
I don’t want to overstep my bounds here with you, especially because I sympathize with this sentiment (and strictly adhere to it when it comes to Velodrome), but unfortunately in the case of funding public goods, the price is of relevance in that it dictates OP’s ability to do so.
I think we ought to be able to refer to its instrumentality to this end while avoiding the ugly speculative discussion that comes from hyperfocus on it. That is, of course, unless there is some sort of legal/regulatory reason to avoid any sort of mention.
jackanorak:
having nothing
Again, their stated goal here is more transactions, users, and li…
jackanorak:
having nothing
Again, their stated goal here is more transactions, users, and liquidity, which I think the current program is on track to accomplish. Optimism does get something out of these incentives. I am arguing that 25 % more incentives to fuel growth in those three metrics is more valuable than incentives for long-tail token liquidity against OP on AMMs that account for less than 30 % of Optimism DEX volumes.
jackanorak:
a distant, engineering-led, speculative approach to accrue value when we’re offering something concrete and data-driven that can be done now to meet an imminent need.
So a network’s token accruing value from block production is “speculative” but pairing the token with long tail assets in constant product AMMs is “concrete” and “data-driven”. Gotcha. Could not disagree more. There is way more value for OP in block production than there is in “partnerships”.
jackanorak:
it’s not necessary to use a program such as Avalanche as a counterfactual.
Why not? Those incentive programs grew their respective network in all of Optimism’s target metrics. They are great comparables and I am not sure why you want to dismiss them.
I guess I do not feel the urgency you do or see this “imminent” need for utility. Incentives are about to kick off on almost all Optimism apps and Bedrock will be online later this year. I don’t buy the theory of the coming OP liquidity crisis, and as I mentioned, you did use unrealistic estimates.
Also, I want to see the Optimism Collective do governance experiments, I just think this is a bad one! And I see hyperbole throughout the proposal, not just the suggestion that grants should stop.
jackanorak: This also means your OP sell pressure numbers are hypothetical and probably overstated. You assume every single OP token will be sold on the market which is misleading, I think it’s fair to assume at least some amount will be held or staked in liquidity pools.
I’m not so sure, considering the moral panic you seem to exhibit at the thought of impermanent loss. Feel free to back your assertion with some data on how much farmers LPing tokens A + B getting paid in token C choose to farm token C. Any seasoned farmer can tell you it would not be much. Or feel free to consider how much long-term holding or LPing you get from users getting incremental tokens for use rewards, or devs getting paid in OP.
And in any case, there would have to be substantial retention of tokens for there not to be a material impact. A 50% haircut in our estimates is still demonstrably intolerable if what we’re trying to swing as OP is sustained funding of public goods.
For any token incentive program, the most important measure is Emissions over Revenue . Projects almost always overpay for growth at the beginning ($1 of Emissions leads to less than $1 of fees), with the goal of flipping that ratio in the future. It’s worth noting that in Optimism’s case, the stated goal for OP incentives is that they not only lead to more transactions (revenue) but also more liquidity and users.
Why not? Those incentive programs grew their respective network in all of Optimism’s target metrics. They are great comparables and I am not sure why you want to dismiss them.
Again, there’s nothing in our proposal that impedes the growth of any of these things. It provides if anything more stable liquidity, thus facilitating more trades, investment, etc., better rates due to greater activity on lending and trading protocols, etc. We’re not saying the net effect ought to be any different from Avalanche Rush or any other programs –– the concrete benefit to these protocols and their users doesn’t change one iota. So yes, they’re good models for OP globally. No, they’re not a counterfactual here.
I guess I do not feel the urgency you do or see this “imminent” need for utility. Incentives are about to kick off on almost all Optimism apps and Bedrock will be online later this year. I don’t buy the theory of the coming OP liquidity crisis, and as I mentioned, you did use unrealistic estimates.
Even if you were to discount our estimates of sell pressure by 50% we’re talking about massive, sustained sell pressure by any reasonable measure. Saying you don’t “feel the urgency” without any evidence or modeling does not help anyone here make sound decisions.
And I see hyperbole throughout the proposal, not just the suggestion that grants should stop.
Would love to see specific examples of how we’ve strayed from data or reason. To answer the question of “what else is hyperbolic” by saying “well, it’s everywhere” isn’t productive.
So a network’s token accruing value from block production is “speculative” but pairing the token with long tail assets in constant product AMMs is “concrete” and “data-driven”. Gotcha. Could not disagree more. There is way more value for OP in block production than there is in “partnerships”.
Whether OP collectively resolves 1. what it’d look like, 2. whether it would outweigh potential risks, 3. ultimately whether to go with it, among other issues is, yes, a matter of speculation. Certainly it could accrue material value, and I’m not saying it’s the wrong path! I’ve had these conversations myself, and there’s much to be gained. But something like this being implemented is months and months away, and the sell pressure we’ve described is occurring as we speak with little other than market markers to mitigate it.
And in that time, the weeks and weeks of incentives being voted on by OP will depreciate, and so on. And, yes, what we’re describing is a mechanical buffer against this sell pressure that also happens to carry many side benefits. It’s a positive-sum construction.
Gotcha. Could not disagree more. There is way more value for OP in block production than there is in “partnerships”.
Not really sure where this adversarial tone is coming from. It’s not an either-or; it’s a matter of meeting needs as they come. Any sort of opinion you may have over what’s good or bad is more helpful when it’s backed by evidence or modeling.
jackanorak:
reserves 25 OP and solicits 25 OP equivalent from partner protocols.
Could y…
jackanorak:
reserves 25 OP and solicits 25 OP equivalent from partner protocols.
Could you please help me with this example:
reserves 25 OP : who will get this and what would be its purpose, same question for 25 equivalent from partner
jackanorak: Instead of giving away 100 tokens, Optimism gives away 75 tokens and keeps 25 tokens for itself.
In return for other grants, some partner protocols may choose to offer some of their own tokens to Optimism, which then pools the 25 OP against protocols’ granted tokens in LPs throughout Optimism.
So now instead of having 0 tokens, Optimism now has custody of 25 OP tokens as well as equivalent value of other protocols’ tokens. So in addition to keeping some of its own tokens under the discretion of governance (possibly to be distributed later!), it also has tokens of OP-domiciled protocols. All of these tokens are used to increase liquidity throughout the ecosystem, and Optimism may choose to exercise governance rights through these partner protocols’ tokens.
forrest:
While having the Optimism Collective act as meta-governance in the ecosystem might ac…
forrest:
While having the Optimism Collective act as meta-governance in the ecosystem might accrue some value to the OP token, I think it would challenge the network’s claim of being credibly neutral. Optimism functions as an extension of Ethereum, and maintaining credible neutrality is a must. Optimism was already accused of showing certain apps favoritism, and this proposal could make things much worse.
Just realized that we missed this question on an important topic - apologies.
Would hope you’d expand on this thought, as we’ve struggled to find any direct line between our proposal and any sort of loss of credible neutrality. Governance is either neutral or not; what it has governance over ought not to affect neutrality.
If your belief is that simply expanding the purview of governance leads to a loss of neutrality [don’t want to misrepresent tho], that implies the desire for highly limited governance, a view I’d really like to hear explained in light of what’s been posted on the forum to date.
Instead of giving away 100 tokens, Optimism gives away 75 tokens and keeps 25 tokens for itse…
Instead of giving away 100 tokens, Optimism gives away 75 tokens and keeps 25 tokens for itself.
In return for other grants, some partner protocols may choose to offer some of their own tokens to Optimism, which then pools the 25 OP against protocols’ granted tokens in LPs throughout Optimism.
So now instead of having 0 tokens, Optimism now has custody of 25 OP tokens as well as equivalent value of other protocols’ tokens. So in addition to keeping some of its own tokens under the discretion of governance (possibly to be distributed later!), it also has tokens of OP-domiciled protocols. All of these tokens are used to increase liquidity throughout the ecosystem, and Optimism may choose to exercise governance rights through these partner protocols’ tokens.
Netrim: But why do this? Optimism already has 5.4% Partner Fund and 8.8% Unallocated. If the core team wanted to do this, they can using those funds and such proposal could fall under a classic POL strategy or maybe someone creates a specific/innovative way of applying it.
OPUser: Lets take a step back, when you say
some of their own tokens to Optimism
are you referring to OP foundation ? If yes, then my understanding was right and let me give you one example.
Your suggestion:
Total number of OP distribution 100, 75 to project, 25 to LP along with 25 other from project receiving the grant. Just for discussion, assume value of each token is $1.
once approved, OP foundation gave 100 Token and got $50 worth of LP, right ? Ignoring impermanent loss.
What about this, OP foundation give 50 to project(without asking anything in return from the project) and out of other 50, buys $25 worth of other project token and do the LP. Here also, foundation gave 100 and still has $50 worth of LP. Sounds weird right ?
You also mentioned that having other project token will give OP foundation right in the said project DAO, right ? First, that is a up to OP foundation if they want to take this responsibility and second, such foundation level change is out of our scope, that kind of change need approval from both house (token and citizen)
But why do this? Optimism already has 5 . 4 % Partner Fund and 8 . 8 % Unallocated. If the core t…
But why do this? Optimism already has 5 . 4 % Partner Fund and 8 . 8 % Unallocated. If the core team wanted to do this, they can using those funds and such proposal could fall under a classic POL strategy or maybe someone creates a specific/innovative way of applying it.
jackanorak: We do this because it’s a positive-sum means of offering to grantees a service they’re already asking for while generating more meaning for governance and cohesion between OP governance and constituent protocols.
Same service, more bang for everyone’s buck. Save the unallocated for non-redundant initiatives once we figure out what to do with it.
This also means your OP sell pressure numbers are hypothetical and probably overstated. You assume…
This also means your OP sell pressure numbers are hypothetical and probably overstated. You assume every single OP token will be sold on the market which is misleading, I think it’s fair to assume at least some amount will be held or staked in liquidity pools.
I’m not so sure, considering the moral panic you seem to exhibit at the thought of impermanent loss. Feel free to back your assertion with some data on how much farmers LPing tokens A + B getting paid in token C choose to farm token C. Any seasoned farmer can tell you it would not be much. Or feel free to consider how much long-term holding or LPing you get from users getting incremental tokens for use rewards, or devs getting paid in OP.
And in any case, there would have to be substantial retention of tokens for there not to be a material impact. A 50 % haircut in our estimates is still demonstrably intolerable if what we’re trying to swing as OP is sustained funding of public goods.
For any token incentive program, the most important measure is Emissions over Revenue . Projects almost always overpay for growth at the beginning ($ 1 of Emissions leads to less than $ 1 of fees), with the goal of flipping that ratio in the future. It’s worth noting that in Optimism’s case, the stated goal for OP incentives is that they not only lead to more transactions (revenue) but also more liquidity and users.
Why not? Those incentive programs grew their respective network in all of Optimism’s target metrics. They are great comparables and I am not sure why you want to dismiss them.
Again, there’s nothing in our proposal that impedes the growth of any of these things. It provides if anything more stable liquidity, thus facilitating more trades, investment, etc., better rates due to greater activity on lending and trading protocols, etc. We’re not saying the net effect ought to be any different from Avalanche Rush or any other programs –– the concrete benefit to these protocols and their users doesn’t change one iota. So yes, they’re good models for OP globally. No, they’re not a counterfactual here.
I guess I do not feel the urgency you do or see this “imminent” need for utility. Incentives are about to kick off on almost all Optimism apps and Bedrock will be online later this year. I don’t buy the theory of the coming OP liquidity crisis, and as I mentioned, you did use unrealistic estimates.
Even if you were to discount our estimates of sell pressure by 50 % we’re talking about massive, sustained sell pressure by any reasonable measure. Saying you don’t “feel the urgency” without any evidence or modeling does not help anyone here make sound decisions.
And I see hyperbole throughout the proposal, not just the suggestion that grants should stop.
Would love to see specific examples of how we’ve strayed from data or reason. To answer the question of “what else is hyperbolic” by saying “well, it’s everywhere” isn’t productive.
So a network’s token accruing value from block production is “speculative” but pairing the token with long tail assets in constant product AMMs is “concrete” and “data-driven”. Gotcha. Could not disagree more. There is way more value for OP in block production than there is in “partnerships”.
Whether OP collectively resolves 1 . what it’d look like, 2 . whether it would outweigh potential risks, 3 . ultimately whether to go with it, among other issues is, yes, a matter of speculation. Certainly it could accrue material value, and I’m not saying it’s the wrong path! I’ve had these conversations myself, and there’s much to be gained. But something like this being implemented is months and months away, and the sell pressure we’ve described is occurring as we speak with little other than market markers to mitigate it.
And in that time, the weeks and weeks of incentives being voted on by OP will depreciate, and so on. And, yes, what we’re describing is a mechanical buffer against this sell pressure that also happens to carry many side benefits. It’s a positive-sum construction.
Gotcha. Could not disagree more. There is way more value for OP in block production than there is in “partnerships”.
Not really sure where this adversarial tone is coming from. It’s not an either-or; it’s a matter of meeting needs as they come. Any sort of opinion you may have over what’s good or bad is more helpful when it’s backed by evidence or modeling.
forrest: jackanorak:
considering the moral panic you seem to exhibit at the thought of impermanent loss
It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasury’s balance sheet. Not going to argue with you about impermanent loss, in this scenario it would, in some capacity, occur on some of the Collective’s liquidity positions.
jackanorak:
evidence or modeling
Your “modeling” is the assumption that every OP token that goes to users in the next 6 months is going to be market sold on an Optimism DEX in the current state of unincentivized Optimism liquidity. I find this unrealistic and pointed to previous network incentive campaigns where enough growth and liquidity were generated to counteract the natural selling pressure that token incentives bring.
jackanorak:
If your broadsides are the result of some fear of self-interest, you can come right out and say it.
Velodrome self-interest is not my concern with this proposal, I think it would be a poor allocation of the Collective’s treasury.
This proposal tries to lock in 25% of OP token incentives for “pairing” on long-tail AMM pairs. If a protocol wants to do this with its own OP grant, great! But why standardize this? The top of funnel for OP incentives should remain open-ended.
jackanorak:
For transparency, of course.
Am I wrong? Given that liquidity mining on the dominant liquidity venue on the network, Uniswap V3, is not very approachable, Velodrome stands the most to benefit from this proposal. That’s all I said.
I will get back to you with my concerns on the metagovernance bit.
We do this because it’s a positive-sum means of offering to grantees a service they’re already aski…
We do this because it’s a positive-sum means of offering to grantees a service they’re already asking for while generating more meaning for governance and cohesion between OP governance and constituent protocols.
Same service, more bang for everyone’s buck. Save the unallocated for non-redundant initiatives once we figure out what to do with it.
Who is asking for this?
First time this was raised was this thread.
But this is not redundant, this…
Who is asking for this?
First time this was raised was this thread.
But this is not redundant, this is a change, I would say a constituent change.
The other issue I am not understand is who is going to own the created LP, since Optimism provides OP, the dex provides their token? So in the case of Velodrone, it would be VELO. But then you need to create the LP for it, and that LP will have only one owner.
If your proposal tries to tackle price, too early to tell and like others have said, many assumptions on your initial post, some of which I don’t agree.
If your proposal tries to tackle governance participation, the issue is very different and this proposal does nothing.
forrest: The project that stands to benefit most from the proposal is the one drafting it. Just stating this for transparency.
jackanorak: Who is asking for this?
First time this was raised was this thread.
35% of all approved OP for distribution has been for the purpose of incentivizing liquidity on a dex. We’re offering an alternative means to achieve the thing protocols are directly calling for. That’s what I mean by redundancy.
The other issue I am not understand is who is going to own the created LP, since Optimism provides OP, the dex provides their token? So in the case of Velodrone, it would be VELO. But then you need to create the LP for it, and that LP will have only one owner.
The owner of the LP would be the Optimism Collective. They would be LPing the tokens, they’d have governance rights over the consitituent tokens, and they would be earning fees and emissions on these tokens.
If your proposal tries to tackle price, too early to tell and like others have said, many assumptions on your initial post, some of which I don’t agree.
Then feel free to substantively rebut our estimates or assumptions. So far nobody has.
If your proposal tries to tackle governance participation, the issue is very different and this proposal does nothing.
Again, please substantiate with a thesis. Ours is this: governance participation will increase when governance participation means more than who gets to distribute tokens. Having direct ability to help inform the direction of constituent protocols is a meaningful step forward for the Collective and is in our view among the most powerful possible draws to participation. I’ve read the forums and haven’t seen a compelling alternative raised so far. If there’s one you have in mind, please direct me.
The project that stands to benefit most from the proposal is the one drafting it. Just stating this…
The project that stands to benefit most from the proposal is the one drafting it. Just stating this for transparency.
We’ve already stated that this absolutely doesn’t have to be on Velodrome, and liquidity is going t…
We’ve already stated that this absolutely doesn’t have to be on Velodrome, and liquidity is going to go onto our or other platforms one way or another through liq mining. So net benefit for us is actually marginal and possibly negative, as this is essentially free (i.e., not bribed or rented) liquidity for the protocols.
If your broadsides are the result of some fear of self-interest, you can come right out and say it. But it’s really not our intention here; this is a genuine attempt to bring real, actionable ideas to the Collective, one I’m confident is among the first raised here.
forrest: jackanorak:
considering the moral panic you seem to exhibit at the thought of impermanent loss
It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasury’s balance sheet. Not going to argue with you about impermanent loss, in this scenario it would, in some capacity, occur on some of the Collective’s liquidity positions.
jackanorak:
evidence or modeling
Your “modeling” is the assumption that every OP token that goes to users in the next 6 months is going to be market sold on an Optimism DEX in the current state of unincentivized Optimism liquidity. I find this unrealistic and pointed to previous network incentive campaigns where enough growth and liquidity were generated to counteract the natural selling pressure that token incentives bring.
jackanorak:
If your broadsides are the result of some fear of self-interest, you can come right out and say it.
Velodrome self-interest is not my concern with this proposal, I think it would be a poor allocation of the Collective’s treasury.
This proposal tries to lock in 25% of OP token incentives for “pairing” on long-tail AMM pairs. If a protocol wants to do this with its own OP grant, great! But why standardize this? The top of funnel for OP incentives should remain open-ended.
jackanorak:
For transparency, of course.
Am I wrong? Given that liquidity mining on the dominant liquidity venue on the network, Uniswap V3, is not very approachable, Velodrome stands the most to benefit from this proposal. That’s all I said.
I will get back to you with my concerns on the metagovernance bit.
Lets take a step back, when you say
some of their own tokens to Optimism
are you referring to OP …
Lets take a step back, when you say
some of their own tokens to Optimism
are you referring to OP foundation ? If yes, then my understanding was right and let me give you one example.
Your suggestion:
Total number of OP distribution 100 , 75 to project, 25 to LP along with 25 other from project receiving the grant. Just for discussion, assume value of each token is $ 1 .
once approved, OP foundation gave 100 Token and got $ 50 worth of LP, right ? Ignoring impermanent loss.
What about this, OP foundation give 50 to project(without asking anything in return from the project) and out of other 50 , buys $ 25 worth of other project token and do the LP. Here also, foundation gave 100 and still has $ 50 worth of LP. Sounds weird right ?
You also mentioned that having other project token will give OP foundation right in the said project DAO, right ? First, that is a up to OP foundation if they want to take this responsibility and second, such foundation level change is out of our scope, that kind of change need approval from both house (token and citizen)
OPUser: not to mention, we are asking project a co-incentive, most of them are matching the grant by $1:1
jackanorak: What about this, OP foundation give 50 to project(without asking anything in return from the project) and out of other 50, buys $25 worth of other project token and do the LP. Here also, foundation gave 100 and still has $50 worth of LP. Sounds weird right ?
Actually think this would be just fine! No problems at all with this; it’s a model we support.
But there’s an element of coordination to the proposal as we’ve laid out, especially in that it helps signal to protocols that they don’t need to bribe/incentivize as much for their liquidity.
You also mentioned that having other project token will give OP foundation right in the said project DAO, right ? First, that is a up to OP foundation if they want to take this responsibility and second, such foundation level change is out of our scope, that kind of change need approval from both house (token and citizen)
This is a helpful procedural point we’re certainly willing to get guidance on in trying to get this done. One way or another, a new proposal has to be made in the first place. We’re here making that proposal.
forrest: jackanorak:
considering the moral panic you seem to exhibit at the thought of impermanent loss
It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasury’s balance sheet. Not going to argue with you about impermanent loss, in this scenario it would, in some capacity, occur on some of the Collective’s liquidity positions.
jackanorak:
evidence or modeling
Your “modeling” is the assumption that every OP token that goes to users in the next 6 months is going to be market sold on an Optimism DEX in the current state of unincentivized Optimism liquidity. I find this unrealistic and pointed to previous network incentive campaigns where enough growth and liquidity were generated to counteract the natural selling pressure that token incentives bring.
jackanorak:
If your broadsides are the result of some fear of self-interest, you can come right out and say it.
Velodrome self-interest is not my concern with this proposal, I think it would be a poor allocation of the Collective’s treasury.
This proposal tries to lock in 25% of OP token incentives for “pairing” on long-tail AMM pairs. If a protocol wants to do this with its own OP grant, great! But why standardize this? The top of funnel for OP incentives should remain open-ended.
jackanorak:
For transparency, of course.
Am I wrong? Given that liquidity mining on the dominant liquidity venue on the network, Uniswap V3, is not very approachable, Velodrome stands the most to benefit from this proposal. That’s all I said.
I will get back to you with my concerns on the metagovernance bit.
not to mention, we are asking project a co-incentive, most of them are matching the grant by $ 1 : 1
not to mention, we are asking project a co-incentive, most of them are matching the grant by $ 1 : 1
jackanorak: not to mention, we are asking project a co-incentive, most of them are matching the grant by $1:1
This is a great point in support of our plan that we’d missed; protocols are already donating their tokens to get liquidity. This actually makes the full accounting of the plan much more feasible, as we can credibly say that these participating protocols are able and willing to offer their tokens for liquidity.
Who is asking for this?
First time this was raised was this thread.
35 % of all approved OP for …
Who is asking for this?
First time this was raised was this thread.
35 % of all approved OP for distribution has been for the purpose of incentivizing liquidity on a dex. We’re offering an alternative means to achieve the thing protocols are directly calling for. That’s what I mean by redundancy.
The other issue I am not understand is who is going to own the created LP, since Optimism provides OP, the dex provides their token? So in the case of Velodrone, it would be VELO. But then you need to create the LP for it, and that LP will have only one owner.
The owner of the LP would be the Optimism Collective. They would be LPing the tokens, they’d have governance rights over the consitituent tokens, and they would be earning fees and emissions on these tokens.
If your proposal tries to tackle price, too early to tell and like others have said, many assumptions on your initial post, some of which I don’t agree.
Then feel free to substantively rebut our estimates or assumptions. So far nobody has.
If your proposal tries to tackle governance participation, the issue is very different and this proposal does nothing.
Again, please substantiate with a thesis. Ours is this: governance participation will increase when governance participation means more than who gets to distribute tokens. Having direct ability to help inform the direction of constituent protocols is a meaningful step forward for the Collective and is in our view among the most powerful possible draws to participation. I’ve read the forums and haven’t seen a compelling alternative raised so far. If there’s one you have in mind, please direct me.
Netrim: The owner of the LP would be the Optimism Collective. They would be LPing the tokens, they’d have governance rights over the constituent tokens, and they would be earning fees and emissions on these tokens.
If the Optimism Collective wants to create such endeavor, they would need to create such a proposal and go thru both houses.
Then feel free to substantively rebut our estimates or assumptions. So far nobody has.
Napkin math here. Of the 40M to be distributed over Phase0, around 18M have been done so far. Those protocols haven’t started with their incentives. The End.
On a side note: It’s clever to frame the discussion here for price since discord has a strict no price talk.
If your proposal tries to tackle governance participation, the issue is very different and this proposal does nothing.
There is a governance apathy because people being people (Solving voter apathy) , will only look at their own short term incentives. The second issue is the delegation/voting excludes all but OP sitting in a wallet. You can’t LP it and you can do anything remotely composable for it. If you want to create a meaningful or different product that will have an outstanding backlash from the community, create a wrapper for OP, make it composable for yield and/or money market, and used the underlying OP for delegation to yourself.
As a final note, this forum is very active on the topics that draw interest (not counting the users that create an account to make one comment at the behest of some protocol’s proposal). That your proposal has garnered 29 responses in less than 24hs, BUT all of them are rebutals, should tell you everything you need to know on why it’s incorrectly framed.
not to mention, we are asking project a co-incentive, most of them are matching the grant by $ 1 :…
not to mention, we are asking project a co-incentive, most of them are matching the grant by $ 1 : 1
This is a great point in support of our plan that we’d missed; protocols are already donating their tokens to get liquidity. This actually makes the full accounting of the plan much more feasible, as we can credibly say that these participating protocols are able and willing to offer their tokens for liquidity.
What about this, OP foundation give 50 to project(without asking anything in return from the pro…
What about this, OP foundation give 50 to project(without asking anything in return from the project) and out of other 50 , buys $ 25 worth of other project token and do the LP. Here also, foundation gave 100 and still has $ 50 worth of LP. Sounds weird right ?
Actually think this would be just fine! No problems at all with this; it’s a model we support.
But there’s an element of coordination to the proposal as we’ve laid out, especially in that it helps signal to protocols that they don’t need to bribe/incentivize as much for their liquidity.
You also mentioned that having other project token will give OP foundation right in the said project DAO, right ? First, that is a up to OP foundation if they want to take this responsibility and second, such foundation level change is out of our scope, that kind of change need approval from both house (token and citizen)
This is a helpful procedural point we’re certainly willing to get guidance on in trying to get this done. One way or another, a new proposal has to be made in the first place. We’re here making that proposal.
OPUser: okey, so let me summarize this.
Example I gave is absurd as we are creating liquidity by diluting our own token. I would like to see them being used and believe GF fund is doing the same, sure here also token will be diluted but there is fair chance that we will be able to fund and support a project proposal which will help in on-boarding new users, liquidity and innovation.
Also, I would like to point out and you might have read this too as you mentioned reading all the proposals, going forward most delegate, including me, are looking for more than just LP reward in a proposal.
We’re here making that proposal.
This is good move, having early discussion will help us all. But like I said, you need to wait until both house are live and I expect citizen house to be active in next few month(just my random guess).
That’s all I have to say as now, will be reading the thread and jump in if I needed.
OPUser: I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal…
OPUser: I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal. Wanted to make a comment not about the discussion here, but about your manner of discussion. I’ve noted in several posts that you are quite dismissive of ideas you do not personally agree with, without providing clear rational or full engagement with contrary arguments. You are not worried about token price, and do not think token price is connected to governance activity. Does that make these opinions true? Why is liquidity not a crucial problem? How are you defining liquidity? Why will Delegates voting on individual protocol’s proposals cause bias? Why should you abstain from a governance discussion or vote when a protocol submits to OP if you also participated in a governance discussion or vote on that individual protocol? Being a delegate somewhere should not curtail ANYONE from participating in governance elsewhere. This is core to the entire ethos of decentralization and autonomy. You claim that “this assumption is wrong” re: the distributed grant OP being sold evenly over the next six months. First of all, be acknowledge that this is a hypothetical, but offer no clear numbers on how many protocols are using OP as Lp rewards. What makes YOUR assumption that “token distribution will be gradual” accurate? Can you please provide evidence for this assumption? This proposal emerged out of a comprehensive review of every single grant proposal submitted to OP, and was also discussed prior to publication with members of the OP team itself. OPUser: And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias. We are mixing two things here, price of OP and Public Good. That is right, because they are mixed. Tokens have both economic value and governance value, and the very “public good funding” that the OP token is being used for DEPENDS on token value. No public good’s funding without the token having economic value. OPUser: we are also looking into user on boarding This entire proposal is core to user onboarding. Maintaining economic value of $OP is fundamental to attracting new users to Optimism. OPUser: I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that. Can you explain why you believe this? and why you are not concerned that a massive distribution of the OP token will result in a token price that could certainly result in negative tailwinds for Public Goods funding, governance, user activity, and more?
OPUser: I’ve noted in several posts that you are quite dismissive of ideas you do not personally agree with, without providing clear rational or full engagement with contrary arguments.
Thank you for the feedback and I would love to extend my thoughts, could you please share the link.
Why will Delegates voting on individual protocol’s proposals cause bias?
If I have stake in Project X, I would choose to abstain from their proposal in GF round. This is how in general voting works, its nothing new.
Can you please provide evidence for this assumption?
Its not assumption, I am simply quoting what mentioned in project proposal.
Again, choose not to comment on anything price related.
The owner of the LP would be the Optimism Collective. They would be LPing the tokens, they’d have …
The owner of the LP would be the Optimism Collective. They would be LPing the tokens, they’d have governance rights over the constituent tokens, and they would be earning fees and emissions on these tokens.
If the Optimism Collective wants to create such endeavor, they would need to create such a proposal and go thru both houses.
Then feel free to substantively rebut our estimates or assumptions. So far nobody has.
Napkin math here. Of the 40 M to be distributed over Phase 0 , around 18 M have been done so far. Those protocols haven’t started with their incentives. The End.
On a side note: It’s clever to frame the discussion here for price since discord has a strict no price talk.
If your proposal tries to tackle governance participation, the issue is very different and this proposal does nothing.
There is a governance apathy because people being people (Solving voter apathy) , will only look at their own short term incentives. The second issue is the delegation/voting excludes all but OP sitting in a wallet. You can’t LP it and you can do anything remotely composable for it. If you want to create a meaningful or different product that will have an outstanding backlash from the community, create a wrapper for OP, make it composable for yield and/or money market, and used the underlying OP for delegation to yourself.
As a final note, this forum is very active on the topics that draw interest (not counting the users that create an account to make one comment at the behest of some protocol’s proposal). That your proposal has garnered 29 responses in less than 24 hs, BUT all of them are rebutals, should tell you everything you need to know on why it’s incorrectly framed.
jackanorak: If the Optimism Collective wants to create such endeavor, they would need to create such a proposal and go thru both houses.
Responded to OPUser with this, but sure. Whatever the process ultimately has to be, we can follow it to get the job done.
Napkin math here. Of the 40M to be distributed over Phase0, around 18M have been done so far. Those protocols haven’t started with their incentives. The End.
Not really sure the point you’re trying to make other than that the entirety of the sell pressure is ahead of us, though we’re certainly excited to see the uptick in activity!
On a side note: It’s clever to frame the discussion here for price since discord has a strict no price talk.
Not really sure how this is relevant; we never even considered going to Discord first, as this proposal sits outside the scope of any individual grant. The only reason we posted in this section vs others was that it pertained to the GF program as a whole and we didn’t want to be presumptuous in posting in a top-level forum.
There is a governance apathy because people being people)) , will only look at their own short term incentives. The second issue is the delegation/voting excludes all but OP sitting in a wallet. You can’t LP it and you can do anything remotely composable for it. If you want to create a meaningful or different product that will have an outstanding backlash from the community, create a wrapper for OP, make it composable for yield and/or money market, and used the underlying OP for delegation to yourself.
“People being people” is exactly why increasing the stakes ought to increase participation. We’re not at all at odds here. And I’d love to see wrappers enabling governance rights for tokens in these other forms; one of the consulting devs on the Velodrome project has been banging on that drum for years. In the meantime, why not focus on immediate possibilities that can get results and participation for this highly critical time?
As a final note, this forum is very active on the topics that draw interest (not counting the users that create an account to make one comment at the behest of some protocol’s proposal).
If you’re referring to dcao above, he is an independent (though friendly) trader who was trolling us in an attempt to undermine our proposal because he is publicly very short OP. His posts are very obviously ridiculing us. If you’re referring to some other protocols, ya there’s evidence of that.
That your proposal has garnered 29 responses in less than 24hs, BUT all of them are rebutals, should tell you everything you need to know on why it’s incorrectly framed.
The majority of these responses are three people separately going in a back and forth with me. I hope you don’t call that governance, consensus, or even signal. And OPUser (don’t want to speak for them), while pushing back, has suggested an openness and curiosity, which is what any person making a proposal would hope to see!
We were excited to hear OPUser’s thoughts due to their thoughtful feedback on our current draft pro…
We were excited to hear OPUser’s thoughts due to their thoughtful feedback on our current draft proposal. We intend to clear up the entirety of their concerns voiced here, most of which we believe merely require some clarification. 36 M that was distributed in Phase 0 was for liquidity and user on-boarding so I dont see a problem if those token are sold out or dumped. That was their sole purpose, on board liquidity according to their proposal Yes, this assumption is wrong. We made no value claims about where the tokens were going, just observing that for 99 % of all tokens being distributed, the ultimate recipient is likely someone who is unmotivated to hold OP vs market selling it. Of course there’s nothing wrong with paying people to LP, use, or build on your product! Velodrome ourselves are using our grant for the same purposes – because these are things that protocols need. This is why we believe protocols have good reason to opt into our proposal, which addresses liquidity, by far the most requested need, and prolongs the efficacy of these programs. That Governance is fine with using OP for these purposes doesn’t make it less unsustainable, which is our claim. Not all of the token will be sold, token distribution plan from their proposal is from 6 - 24 months and few of them are not using their token as an LP reward, so token distribution will be gradual. Going through the individual approved applications, we saw the distribution being heavily stacked toward the 6 - 12 month horizon. We certainly can provide supporting data if this is enough of a sticking point. But even if tokens were distributed equally over 18 months (which is VERY generous); you’d still see unmitigated sell pressure of roughly a quarter of all LP’ed tokens each month. By the time the 6 th month came around, the value of the grant would likely be a small fraction of what it would have been if spent at the start. Some GF proposals have already asked for an inflated amount of tokens, claiming they are anticipating this fact! One thing we didn’t cover in our proposal would be that this observed sell pressure will heavily encourage front-loading of distributions by partner protocols, as they will stand to be better off using their tokens now and risk missing out on future grants than comply with expectations to get a second distribution worth a small fraction of the first. It will cause bias, if I have a say in project X and they submit a proposal here on GF fund, only option for me to abstain from discussion. This will work out just fine on organizational and/or project level, just as you mentioned below If you believe that the Optimism Collective’s ownership of project governance tokens would bias your personal decisions, either you have graver concerns about the functionality of decentralized governance structures in general – or you (possibly correctly) believe that you, OPUser, individually have outsized influence on the collective, such that you can sway things for your personal benefit, which would naturally be problematic from a decentralization standpoint. Separately, how would this structure be more problematic than an individual personally owning a large stake in project X and thus being conflicted — which of course is almost certainly the case for many delegates and perhaps something unavoidable? To be honest, we believe this feature is the most exciting thing for committed delegates, as it reflects in our view a compelling experimentation around decentralized governance (and capitalism) – a collective stake in participating organizations. This is nice idea but will not work This opinion, on the other hand, in response to our data- and experience-driven proposal, has no support. Why not share your bias against this? Pretty sure we can address any material concerns you may have. And going back to last point, I dont expect anyone from OP foundation to comment on your proposal because I will see bias. Why would this be the case? Spell out exactly how they’d be biased. Is it because you think this benefits Velodrome? Note that nowhere do we mention Velodrome as a place to LP tokens; that is up to the OP Collective. If this is why you are concerned, do you believe that their small stake in Velodrome is enough to materially sway their interests? There are many fantastic places to LP tokens, each with its benefits. Uni naturally has unique strengths, Beethoven’s well known for its farming abilities, etc. And consider the opposite: it is entirely possible that they influenced us to make this proposal for the good of Optimism because, as tokenholders, they have a say in what sorts of communications we put out. And that would be a good thing. [To be clear, though, this proposal was entirely conceived by the Velodrome team.] If someone from the Foundation were to comment on this, we would expect participants here to see them as people who put the Collective first. We’re genuinely confused at how you could expect otherwise. We are mixing two things here, price of OP and Public Good. Of course we are. We recognize the need to paint a veneer of propriety such that we don’t have random tokenholders screeching “but token price”, but until the OP Collective can figure out a way to accrue a material treasury, the token is how we have the ability to fund public goods. What we’re doing is offering a mechanical and governance-driven means of ensuring that this method is sustainable. Seeing the token go to zero critically hamstrings the Collective’s capability to fund public goods or RFPG, which limits protocols’ capacity to facilitate user/liquidity/protocol onboarding, which lowers the stakes for governance participation, which leads to a death spiral. We are laying out our concerns with the weight of experience of having seen this play out in several contexts – and, we believe, our expertise, having professionally consulted for protocols (e.g., Redacted) and layers (e.g., Boba) on this very subject, to say nothing of our deep history in complex tokenomics. We are sounding the warning here because not attending to this is a grave mistake. Let’s drop the pearls, people. Again, in my opinion, this we should not do. Pausing will only hurt our progress we have made so far. Pausing would prevent OP from multiplying the sell pressure overnight. Can you explain what sort of progress would be stalled in support of this? Why would delaying, say, two weeks have a material impact? In Phase 1 , we are not just focusing on LP, we are also looking into user on boarding via different approach, application migration and integration, marketing and even development support if idea is unique. Now we are asking projects to submit KPI based proposal if its based on LP incentives and we are working on making sure that its sustainable, long term. Again, opinion varies according to delegate but from what I see, we are looking beyond just LP. As far as we can tell, none of these entails doing anything other than paying somebody OP so they can sell for stables. Would love to see an alternative — so much so that we’ve suggested one! This seems to be focused on price of token with a mask of public good. We should keep them separate. Already addressed above, but we’ll emphasize: this is an aesthetic objection to a material concern. The token price is not its own end; it is the sum total of Optimism’s operational capacity. Moreover, this a rank misreading of our proposal, which is in fact not focused primarily on the token price. The broader objectives you yourself have raised include participation in governance. Our proposal increases the stakes for governance. The Constitution calls for experimentation in modes of governance; we’ve outlined in detail a way to dramatically expand the scope of governance. You provide links to discussions on how to accrue value to governance; we’re not sure what else you can call our proposal. Personally, I dont see a proposal if token are being dumped as long the reason is justified in their proposal. Again, depends on proposal. At the end of day, 1 OP will always has 1 voting power as it should be, after all its a Gov token. Again, we’re not making value claims about the intended purpose of these tokens. We’re devising a win-win-win way to sustain these intended uses of the tokens. For public good we have dedicated 20 % fund and its distribution is based on different logic which I am really excited about. Sure, but again we’re commenting specifically on the current program’s sustainability, on which we’re not picking up any material pushback. We are in dire need of community engagement, if i look at the stats on this forum, user involvement are going down each passing day. What can we do for that ?Last voting cycle, we had 17 M vote count on proposal. I think liquidity will see some boost once fraud proof and bedrock is implemented, current market sentiment is also having some impact on that. You can’t get around the fact that governance participation will pick up when there are higher stakes and modalities to it. Merely accepting the status quo of meting out rapidly depreciating tokens to a few dozen protocols is simply not enough to bring in outside participation, and tech updates will of course do precious little to affect that. But because we have a vested interest in making sure Optimism thrives, we will certainly do our part. We have few thoughts and thread going on to improve overall gov process. Please join us there. Sure, we’re happy to explain how this proposal would address all of these concerns. We’d actually considered doing this already. We’ll consider this your active encouragement to do so. I see, you have marked it as Ready, unfortunately, I am not in favor of this proposal. You might be, but we hope others reading can critically evaluate this on its merits. It would indeed be a concerning thing for governance if participation is so low that OPUser’s opposition is enough to stall what we believe is the first immediately actionable way to address an imminent threat to Governance’s power to satisfy one of its core mandates. Nonetheless, this is the only change you’ve convinced us to make in our proposal, if only because we want to encourage more discussion (and clear up some particulars) before finalizing, and marking it as READY may have discouraged that. We are encouraging readers and delegates to think bigger; we want Optimism to grow up and meet its potential, and to do so we must be receptive to experimentation, especially when there is a sound thesis and solid support behind it.
OPUser: But even if tokens were distributed equally over 18 months (which is VERY generous);
You are right here and I am also looking at how it will turn out, you also know, those funds are already distributed and there no point discussing about it now. All we can do is wait, see and learn from it.
Some GF proposals have already asked for an inflated amount of tokens, claiming they are anticipating this fact!
Again, I agree with you and like I mentioned earlier, best place to point this out is on project proposal so that they can work on it. I have seen, many projects are quite responsive to feedback and willing to amend their proposal.
If you believe that the
It not about me or you, I am talking in general. We had seen this in past voting cycle as well, If an entity has stake in a project, they choose to abstain from their proposal.
Spell out exactly the source of their bias
No, its not about your project or anyone in particular, apologies if my words were not formed properly you get a felling that I am referring to your project. If I have stake in Project X, I would choose to abstain from their proposal in GF round and would expect others too do so if they also have stake in them.
If someone from the Foundation were to comment on this, we would expect participants here to see them as people who put the Collective first.
I see here we have different opinion, from what I understood, GF funds are for token house and users holding token have say in this. Of course, at initial stage OP Foundation can decide to approve or reject it but only when a proposal is approved by token house.
Why would delaying, say, two weeks have a material impact?
2 Weeks would not be a problem, I was thinking a pause for months. Reason being, if we pause for months, there will be many proposal at once which would be hard to judge and manage.
OPUser, individually have outsized influence on the collective
Its quite opposite, I am no one, my knowledge is limited and I still learning about different tools and technology and trying to find my niche. There are few delegate here, far more knowledgeable than me and I look up to them.
I have chosen not to share my view on any comment related to token price.
If I am missing anything here, let me know and i would try to explain it it detail.
okey, so let me summarize this.
Example I gave is absurd as we are creating liquidity by diluting o…
okey, so let me summarize this.
Example I gave is absurd as we are creating liquidity by diluting our own token. I would like to see them being used and believe GF fund is doing the same, sure here also token will be diluted but there is fair chance that we will be able to fund and support a project proposal which will help in on-boarding new users, liquidity and innovation.
Also, I would like to point out and you might have read this too as you mentioned reading all the proposals, going forward most delegate, including me, are looking for more than just LP reward in a proposal.
We’re here making that proposal.
This is good move, having early discussion will help us all. But like I said, you need to wait until both house are live and I expect citizen house to be active in next few month(just my random guess).
That’s all I have to say as now, will be reading the thread and jump in if I needed.
jackanorak: Example I gave is absurd as we are creating liquidity by diluting our own token. I would like to see them being used and believe GF fund is doing the same, sure here also token will be diluted but there is fair chance that we will be able to fund and support a project proposal which will help in on-boarding new users, liquidity and innovation.
It’s not absurd because 75 OP are being market sold one way or another and the other 25OP are being reserved. What makes it inefficient is the fuller accounting of what’s occurring in that the protocol is not getting the 25 extra OP of value in exchange for its token.
Also, I would like to point out and you might have read this too as you mentioned reading all the proposals, going forward most delegate, including me, are looking for more than just LP reward in a proposal.
It really can’t be lost that we are insisting on continuing grants as they are (for all their multifarious purposes), just with some portion of the 35%-ish of liquidity mining OP instead being used for this LP purpose.
This is good move, having early discussion will help us all. But like I said, you need to wait until both house are live and I expect citizen house to be active in next few month(just my random guess).
So any sort of meta-governance is off the table until this next piece comes online? In that case we insist on getting a definitive answer on this issue because we don’t see much reason to wait for another piece of the structure to come online unless there’s an obvious reason for it.
If the Optimism Collective wants to create such endeavor, they would need to create such a proposa…
If the Optimism Collective wants to create such endeavor, they would need to create such a proposal and go thru both houses.
Responded to OPUser with this, but sure. Whatever the process ultimately has to be, we can follow it to get the job done.
Napkin math here. Of the 40 M to be distributed over Phase 0 , around 18 M have been done so far. Those protocols haven’t started with their incentives. The End.
Not really sure the point you’re trying to make other than that the entirety of the sell pressure is ahead of us, though we’re certainly excited to see the uptick in activity!
On a side note: It’s clever to frame the discussion here for price since discord has a strict no price talk.
Not really sure how this is relevant; we never even considered going to Discord first, as this proposal sits outside the scope of any individual grant. The only reason we posted in this section vs others was that it pertained to the GF program as a whole and we didn’t want to be presumptuous in posting in a top-level forum.
There is a governance apathy because people being people)) , will only look at their own short term incentives. The second issue is the delegation/voting excludes all but OP sitting in a wallet. You can’t LP it and you can do anything remotely composable for it. If you want to create a meaningful or different product that will have an outstanding backlash from the community, create a wrapper for OP, make it composable for yield and/or money market, and used the underlying OP for delegation to yourself.
“People being people” is exactly why increasing the stakes ought to increase participation. We’re not at all at odds here. And I’d love to see wrappers enabling governance rights for tokens in these other forms; one of the consulting devs on the Velodrome project has been banging on that drum for years. In the meantime, why not focus on immediate possibilities that can get results and participation for this highly critical time?
As a final note, this forum is very active on the topics that draw interest (not counting the users that create an account to make one comment at the behest of some protocol’s proposal).
If you’re referring to dcao above, he is an independent (though friendly) trader who was trolling us in an attempt to undermine our proposal because he is publicly very short OP. His posts are very obviously ridiculing us. If you’re referring to some other protocols, ya there’s evidence of that.
That your proposal has garnered 29 responses in less than 24 hs, BUT all of them are rebutals, should tell you everything you need to know on why it’s incorrectly framed.
The majority of these responses are three people separately going in a back and forth with me. I hope you don’t call that governance, consensus, or even signal. And OPUser (don’t want to speak for them), while pushing back, has suggested an openness and curiosity, which is what any person making a proposal would hope to see!
OPUser: jackanorak:
three people separately going in a back and forth with me
lol…sorry to push you there, like I said, I am still learning and sometime I needs more information to make a decision.
jackanorak:
considering the moral panic you seem to exhibit at the thought of impermanent loss…
jackanorak:
considering the moral panic you seem to exhibit at the thought of impermanent loss
It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasury’s balance sheet. Not going to argue with you about impermanent loss, in this scenario it would, in some capacity, occur on some of the Collective’s liquidity positions.
jackanorak:
evidence or modeling
Your “modeling” is the assumption that every OP token that goes to users in the next 6 months is going to be market sold on an Optimism DEX in the current state of unincentivized Optimism liquidity. I find this unrealistic and pointed to previous network incentive campaigns where enough growth and liquidity were generated to counteract the natural selling pressure that token incentives bring.
jackanorak:
If your broadsides are the result of some fear of self-interest, you can come right out and say it.
Velodrome self-interest is not my concern with this proposal, I think it would be a poor allocation of the Collective’s treasury.
This proposal tries to lock in 25 % of OP token incentives for “pairing” on long-tail AMM pairs. If a protocol wants to do this with its own OP grant, great! But why standardize this? The top of funnel for OP incentives should remain open-ended.
jackanorak:
For transparency, of course.
Am I wrong? Given that liquidity mining on the dominant liquidity venue on the network, Uniswap V 3 , is not very approachable, Velodrome stands the most to benefit from this proposal. That’s all I said.
I will get back to you with my concerns on the metagovernance bit.
jackanorak: It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasury’s balance sheet. Not going to argue with you about impermanent loss, in this scenario it would, in some capacity, occur on some of the Collective’s liquidity positions.
Area Man unsure whether accepting free $100 a good idea:
“What if I lose $10?” he wonders
The risk is trivial when you’re comparing it against giving away the entire position. You can’t seriously be continuing on this point.
Your “modeling” is the assumption that every OP token that goes to users in the next 6 months is going to be market sold on an Optimism DEX in the current state of unincentivized Optimism liquidity. I find this unrealistic and pointed to previous network incentive campaigns where enough growth and liquidity were generated to counteract the natural selling pressure that token incentives bring.
It’s an illustrative model for which i’ve already noted there is a substantial buffer within which the sell effect continues to be intolerable. And who is going to incentivize the LPing of OP tokens? Haven’t seen any proposals detailing those specifically. Let’s say there’s 50% less selling on 50% more LP (HIGHLY generous): that would be 3.3mm sold on 15mm, still over 20% of all LPed tokens sold per month. Are you actually okay with this?
This proposal tries to lock in 25% of OP token incentives for “pairing” on long-tail AMM pairs. If a protocol wants to do this with its own OP grant, great! But why standardize this?
The 25% was a sample amount and subject to discussion, but standardization as an option (and potentially a requirement) is a good one because it makes clear and puts into action Optimism’s commitment to 1) supporting OP as an ongoing means of funding public goods, 2) supporting enduring liquidity and facilitation of market performance, and 3) expanding the scope and stakes of its governance.
The top of funnel for OP incentives should remain open-ended.
It still would be; again, this is ultimately about increasing and sustaining OP incentives for all kinds of initiatives.
Am I wrong? Given that liquidity mining on the dominant liquidity venue on the network, Uniswap V3, is not very approachable, Velodrome stands the most to benefit from this proposal. That’s all I said
You are, and it’s okay to be wrong, though I appreciate the implied compliment that we are a dominant player on Optimism.
Already explained why the marginal effect of this proposal passing (even if we were to get all of the liqudity) is insignificant and possibly a liability; if we are that dominant, all the liq mining rewards in the status quo are going to veVELO holders (i.e., not LPs) directly as revenue. If this proposal passes, we lose a big chunk of that.
But we’re still coming from behind. Synthetix, Perpetual, and Lyra, the largest players, continue to do most of their incentivization on Curve and v3. Beethoven and Zipswap are also certainly relevant as outlets.
Example I gave is absurd as we are creating liquidity by diluting our own token. I would like to s…
Example I gave is absurd as we are creating liquidity by diluting our own token. I would like to see them being used and believe GF fund is doing the same, sure here also token will be diluted but there is fair chance that we will be able to fund and support a project proposal which will help in on-boarding new users, liquidity and innovation.
It’s not absurd because 75 OP are being market sold one way or another and the other 25 OP are being reserved. What makes it inefficient is the fuller accounting of what’s occurring in that the protocol is not getting the 25 extra OP of value in exchange for its token.
Also, I would like to point out and you might have read this too as you mentioned reading all the proposals, going forward most delegate, including me, are looking for more than just LP reward in a proposal.
It really can’t be lost that we are insisting on continuing grants as they are (for all their multifarious purposes), just with some portion of the 35 %-ish of liquidity mining OP instead being used for this LP purpose.
This is good move, having early discussion will help us all. But like I said, you need to wait until both house are live and I expect citizen house to be active in next few month(just my random guess).
So any sort of meta-governance is off the table until this next piece comes online? In that case we insist on getting a definitive answer on this issue because we don’t see much reason to wait for another piece of the structure to come online unless there’s an obvious reason for it.
Netrim: So any sort of meta-governance is off the table until this next piece comes online? In that case we insist on getting a definitive answer on this issue because we don’t see much reason to wait for another piece of the structure to come online unless there’s an obvious reason for it.
The obvious reason is that The primary responsibility of the Citizens’ House will be funding those public goods which have the most positive impact on the Optimism and Ethereum ecosystems. as detailed here This Governance Will Self Destruct — The Optimism Collective
OPUser: jackanorak:
So any sort of meta-governance is off the table until this next piece comes online
Unfortunately, yes. This demands constitutional change which need both house approval, as @Netrim has mentioned.
But I am not from OP team and if you feel its something urgent and time sensitive matter, please jump in our discord and check with them.
One thing i like about DAO is chautic co-ordination and just because we have different opinion does not mean either of us a wrong, it just that we see differently.
I would suggest you two thing, jump in to our discord(gov-temp-check channel) and seek feedback on this, that might help you move things faster and second would wait until you have some support here from other users and/or delegates.
jackanorak:
three people separately going in a back and forth with me
lol…sorry to push you …
jackanorak:
three people separately going in a back and forth with me
lol…sorry to push you there, like I said, I am still learning and sometime I needs more information to make a decision.
So any sort of meta-governance is off the table until this next piece comes online? In that case w…
So any sort of meta-governance is off the table until this next piece comes online? In that case we insist on getting a definitive answer on this issue because we don’t see much reason to wait for another piece of the structure to come online unless there’s an obvious reason for it.
The obvious reason is that The primary responsibility of the Citizens’ House will be funding those public goods which have the most positive impact on the Optimism and Ethereum ecosystems. as detailed here This Governance Will Self Destruct — The Optimism Collective 2
jackanorak: Okay, now you’re grasping. If this were the final word, there would be no voting on any OP grants at all. Think we’ll have to do our own research.
It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasur…
It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasury’s balance sheet. Not going to argue with you about impermanent loss, in this scenario it would, in some capacity, occur on some of the Collective’s liquidity positions.
Area Man unsure whether accepting free $ 100 a good idea:
“What if I lose $ 10 ?” he wonders
The risk is trivial when you’re comparing it against giving away the entire position. You can’t seriously be continuing on this point.
Your “modeling” is the assumption that every OP token that goes to users in the next 6 months is going to be market sold on an Optimism DEX in the current state of unincentivized Optimism liquidity. I find this unrealistic and pointed to previous network incentive campaigns where enough growth and liquidity were generated to counteract the natural selling pressure that token incentives bring.
It’s an illustrative model for which i’ve already noted there is a substantial buffer within which the sell effect continues to be intolerable. And who is going to incentivize the LPing of OP tokens? Haven’t seen any proposals detailing those specifically. Let’s say there’s 50 % less selling on 50 % more LP (HIGHLY generous): that would be 3 . 3 mm sold on 15 mm, still over 20 % of all LPed tokens sold per month. Are you actually okay with this?
This proposal tries to lock in 25 % of OP token incentives for “pairing” on long-tail AMM pairs. If a protocol wants to do this with its own OP grant, great! But why standardize this?
The 25 % was a sample amount and subject to discussion, but standardization as an option (and potentially a requirement) is a good one because it makes clear and puts into action Optimism’s commitment to 1 ) supporting OP as an ongoing means of funding public goods, 2 ) supporting enduring liquidity and facilitation of market performance, and 3 ) expanding the scope and stakes of its governance.
The top of funnel for OP incentives should remain open-ended.
It still would be; again, this is ultimately about increasing and sustaining OP incentives for all kinds of initiatives.
Am I wrong? Given that liquidity mining on the dominant liquidity venue on the network, Uniswap V 3 , is not very approachable, Velodrome stands the most to benefit from this proposal. That’s all I said
You are, and it’s okay to be wrong, though I appreciate the implied compliment that we are a dominant player on Optimism.
Already explained why the marginal effect of this proposal passing (even if we were to get all of the liqudity) is insignificant and possibly a liability; if we are that dominant, all the liq mining rewards in the status quo are going to veVELO holders (i.e., not LPs) directly as revenue. If this proposal passes, we lose a big chunk of that.
But we’re still coming from behind. Synthetix, Perpetual, and Lyra, the largest players, continue to do most of their incentivization on Curve and v 3 . Beethoven and Zipswap are also certainly relevant as outlets.
No, it’s sincerely been a good exercise. Hope it’s been meaningful for you.
No, it’s sincerely been a good exercise. Hope it’s been meaningful for you.
Okay, now you’re grasping. If this were the final word, there would be no voting on any OP grants a…
Okay, now you’re grasping. If this were the final word, there would be no voting on any OP grants at all. Think we’ll have to do our own research.
jackanorak:
So any sort of meta-governance is off the table until this next piece comes online…
jackanorak:
So any sort of meta-governance is off the table until this next piece comes online
Unfortunately, yes. This demands constitutional change which need both house approval, as @Netrim has mentioned.
But I am not from OP team and if you feel its something urgent and time sensitive matter, please jump in our discord and check with them.
One thing i like about DAO is chautic co-ordination and just because we have different opinion does not mean either of us a wrong, it just that we see differently.
I would suggest you two thing, jump in to our discord(gov-temp-check channel) and seek feedback on this, that might help you move things faster and second would wait until you have some support here from other users and/or delegates.
Sure thing. But the OP Team already viewed this proposal at several levels and deemed it appropriat…
Sure thing. But the OP Team already viewed this proposal at several levels and deemed it appropriate for review under the current structure, so seems like an unnecessary step.
Still haven’t seen anything definitive indicating that what we’re proposing entails a constitutional disruption.
jackanorak:
Still haven’t seen anything definitive indicating that what we’re proposing entail…
jackanorak:
Still haven’t seen anything definitive indicating that what we’re proposing entails a constitutional disruption
We are going in circle here, I feel.
Owning the LP address and related responsibility that will come with it will be a task for OP foundation.
In order for us to recommend this, we need approval from Both house.
For sure. You’re making this assertion, and I’m trying to determine whether it’s true. Will researc…
For sure. You’re making this assertion, and I’m trying to determine whether it’s true. Will research and consult.
But questions about process shouldn’t limit discussion on this proposal on its merits.
Yes please, supporting document will help.
My source of knowledge is OPerating manual. This is what…
Yes please, supporting document will help.
My source of knowledge is OPerating manual. This is what comes under gov funding proposal.
image 1364 × 381 37 . 6 KB
“OPerating Manual of the Optimism Collective (v 0 . 1 . 2 ) [OLD]”
And I dont see this proposal fitting in any catorgy mentioned there, So this requires updating the OPerating manual which need to be done by OP Foundation.
But questions about process shouldn’t limit discussion on this proposal on its merits.
Sure.
For any token incentive program, the most important measure is Emissions over Revenue. Projects alm…
For any token incentive program, the most important measure is Emissions over Revenue. Projects almost always overpay for growth at the beginning ($ 1 of Emissions leads to less than $ 1 of fees), with the goal of flipping that ratio in the future. It’s worth noting that in Optimism’s case, the stated goal for OP incentives is that they not only lead to more transactions (revenue) but also more liquidity and users. Importantly, none of the Phase 0 programs have started distributing OP, so we cannot really measure this Emissions/Revenue ratio for Optimism. This also means your OP sell pressure numbers are hypothetical and probably overstated. You assume every single OP token will be sold on the market which is misleading, I think it’s fair to assume at least some amount will be held or staked in liquidity pools. Backing this claim up with data from another network’s liquidity mining campaign (ex. Polygon or Avalanche) would be helpful. I know that in both cases, native token incentives for dapps led to growth in all of the key areas: transactions, liquidity, and users. And they did this without having the native token collapse from sell pressure. My biggest problem with the proposal is that it would see the Optimism Treasury take on significant impermanent loss risk. Token pairs with high divergence are more likely to suffer from impermanent loss, and it’s fair to assume OP will continue to be more volatile than say, ETH. Arbitrageurs will rejoice if OP is naively overallocated into constant product AMMs. While having the Optimism Collective act as meta-governance in the ecosystem might accrue some value to the OP token, I think it would challenge the network’s claim of being credibly neutral. Optimism functions as an extension of Ethereum, and maintaining credible neutrality is a must. Optimism was already accused of showing certain apps favoritism, and this proposal could make things much worse. jackanorak: This is unironically true. Unironically, impermanent loss invalidates the meme. By pairing OP with long tail tokens on AMMs, the Collective would lose value on many of their positions. jackanorak: We suggest that new grants be frozen until we consider this proposal. This is a ridiculous suggestion. The Collective should continue giving grants to projects they believe can convert incentives into more Optimism transactions, liquidity, and users. Overall, this proposal uses a lot of hyperbole and does not establish itself as clearly better than the OP incentives that dozens of projects are about to kick off, many of which will enhance the OP token’s on-chain liquidity. Pairing OP with new projects’ tokens on AMMs is not “funding public goods”, I hope other readers and delegates see this clearly. I believe the OP token’s utility will reach maturity only once sequencing/block production is decentralized. This is where it will derive most of its value, and trying to append weird and somewhat risky utility onto it now is a bit short-sighted. I am not in favor of this proposal and would vote against it. Disclosure: I am on the Rubicon team. Regardless of how it would impact our protocol, I simply think this is not a wise move for the Collective.
jackanorak: The simple fact that OP would have these coins in the first place vs outright distributing them and thus having nothing invalidates the majority of your objection to the point where we have to wonder whether we expressed our plan clearly enough.
Consider:
Status quo, Optimism distributes 100 OP.
Our proposal, Optimism distributes 75 OP , reserves 25 OP and solicits 25 OP equivalent from partner protocols.
Setting aside the likely farming benefits to offset IL (after all, that is the compensation!), think there’s basic math you’re not seeing here.
Not really sure why you claim hyperbole in the proposal. We’re not saying that the grant program be stopped indefinitely - we consider it a means of prolonging its efficacy.
The fact of your calling it ‘weird’ I think gives your game away. You seek a distant, engineering-led, speculative approach to accrue value when we’re offering something concrete and data-driven that can be done now to meet an imminent need. The fact of expanding and iterating on modes of governance is not ‘weird’ – it’s literally baked into the Working Constitution.
Really unsure how else to respond here other than to reemphasize, this is not a wholesale stand-in for grants; it’s not necessary to use a program such as Avalanche as a counterfactual. We’re talking about changing how protocols get the thing they’re asking for – dex-based liquidity – in a positive-sum way. Even if we suppose that some marginal incentivized liquidity provider would miss out at the start, there remain the same outside incentives (and the same liquidity) to encourage plenty of new users, capital, and development – and, again, with our plan you could be comfortable in the likelihood of being able to prolong existing liquidity mining programs (and start new ones), along with all the others, to continue to bring in this activity.
jackanorak: forrest:
While having the Optimism Collective act as meta-governance in the ecosystem might accrue some value to the OP token, I think it would challenge the network’s claim of being credibly neutral. Optimism functions as an extension of Ethereum, and maintaining credible neutrality is a must. Optimism was already accused of showing certain apps favoritism, and this proposal could make things much worse.
Just realized that we missed this question on an important topic - apologies.
Would hope you’d expand on this thought, as we’ve struggled to find any direct line between our proposal and any sort of loss of credible neutrality. Governance is either neutral or not; what it has governance over ought not to affect neutrality.
If your belief is that simply expanding the purview of governance leads to a loss of neutrality [don’t want to misrepresent tho], that implies the desire for highly limited governance, a view I’d really like to hear explained in light of what’s been posted on the forum to date.
The simple fact that OP would have these coins in the first place vs outright distributing them and…
The simple fact that OP would have these coins in the first place vs outright distributing them and thus having nothing invalidates the majority of your objection to the point where we have to wonder whether we expressed our plan clearly enough. Consider: Status quo, Optimism distributes 100 OP. Our proposal, Optimism distributes 75 OP , reserves 25 OP and solicits 25 OP equivalent from partner protocols. Setting aside the likely farming benefits to offset IL (after all, that is the compensation!), think there’s basic math you’re not seeing here. Not really sure why you claim hyperbole in the proposal. We’re not saying that the grant program be stopped indefinitely - we consider it a means of prolonging its efficacy. The fact of your calling it ‘weird’ I think gives your game away. You seek a distant, engineering-led, speculative approach to accrue value when we’re offering something concrete and data-driven that can be done now to meet an imminent need. The fact of expanding and iterating on modes of governance is not ‘weird’ – it’s literally baked into the Working Constitution. Really unsure how else to respond here other than to reemphasize, this is not a wholesale stand-in for grants; it’s not necessary to use a program such as Avalanche as a counterfactual. We’re talking about changing how protocols get the thing they’re asking for – dex-based liquidity – in a positive-sum way. Even if we suppose that some marginal incentivized liquidity provider would miss out at the start, there remain the same outside incentives (and the same liquidity) to encourage plenty of new users, capital, and development – and, again, with our plan you could be comfortable in the likelihood of being able to prolong existing liquidity mining programs (and start new ones), along with all the others, to continue to bring in this activity.
forrest: jackanorak:
having nothing
Again, their stated goal here is more transactions, users, and liquidity, which I think the current program is on track to accomplish. Optimism does get something out of these incentives. I am arguing that 25% more incentives to fuel growth in those three metrics is more valuable than incentives for long-tail token liquidity against OP on AMMs that account for less than 30% of Optimism DEX volumes.
jackanorak:
a distant, engineering-led, speculative approach to accrue value when we’re offering something concrete and data-driven that can be done now to meet an imminent need.
So a network’s token accruing value from block production is “speculative” but pairing the token with long tail assets in constant product AMMs is “concrete” and “data-driven”. Gotcha. Could not disagree more. There is way more value for OP in block production than there is in “partnerships”.
jackanorak:
it’s not necessary to use a program such as Avalanche as a counterfactual.
Why not? Those incentive programs grew their respective network in all of Optimism’s target metrics. They are great comparables and I am not sure why you want to dismiss them.
I guess I do not feel the urgency you do or see this “imminent” need for utility. Incentives are about to kick off on almost all Optimism apps and Bedrock will be online later this year. I don’t buy the theory of the coming OP liquidity crisis, and as I mentioned, you did use unrealistic estimates.
Also, I want to see the Optimism Collective do governance experiments, I just think this is a bad one! And I see hyperbole throughout the proposal, not just the suggestion that grants should stop.
OPUser: jackanorak:
reserves 25 OP and solicits 25 OP equivalent from partner protocols.
Could you please help me with this example:
reserves 25 OP : who will get this and what would be its purpose, same question for 25 equivalent from partner
But even if tokens were distributed equally over 18 months (which is VERY generous); You are ri…
But even if tokens were distributed equally over 18 months (which is VERY generous); You are right here and I am also looking at how it will turn out, you also know, those funds are already distributed and there no point discussing about it now. All we can do is wait, see and learn from it. Some GF proposals have already asked for an inflated amount of tokens, claiming they are anticipating this fact! Again, I agree with you and like I mentioned earlier, best place to point this out is on project proposal so that they can work on it. I have seen, many projects are quite responsive to feedback and willing to amend their proposal. If you believe that the It not about me or you, I am talking in general. We had seen this in past voting cycle as well, If an entity has stake in a project, they choose to abstain from their proposal. Spell out exactly the source of their bias No, its not about your project or anyone in particular, apologies if my words were not formed properly you get a felling that I am referring to your project. If I have stake in Project X, I would choose to abstain from their proposal in GF round and would expect others too do so if they also have stake in them. If someone from the Foundation were to comment on this, we would expect participants here to see them as people who put the Collective first. I see here we have different opinion, from what I understood, GF funds are for token house and users holding token have say in this. Of course, at initial stage OP Foundation can decide to approve or reject it but only when a proposal is approved by token house. Why would delaying, say, two weeks have a material impact? 2 Weeks would not be a problem, I was thinking a pause for months. Reason being, if we pause for months, there will be many proposal at once which would be hard to judge and manage. OPUser, individually have outsized influence on the collective Its quite opposite, I am no one, my knowledge is limited and I still learning about different tools and technology and trying to find my niche. There are few delegate here, far more knowledgeable than me and I look up to them. I have chosen not to share my view on any comment related to token price. If I am missing anything here, let me know and i would try to explain it it detail.
jackanorak: Jack here. Many thanks for the considerate reply. Will respond per item.
You are right here and I am also looking at how it will turn out, you also know, those funds are already distributed and there no point discussing about it now. All we can do is wait, see and learn from it.
Yes, absolutely. The last batch was intended as a demonstration to provide a sense of scale. Of relevance is the next batch (and so on), which is why we were asking to hold off on this series of grants, just for a week or two, to consider this proposal.
We’ve submitted this proposal as a team, but I would volunteer to dedicate myself solely to this project to make sure we could get to consensus quickly enough to continue rewards.
Again, I agree with you and like I mentioned earlier, best place to point this out is on project proposal so that they can work on it. I have seen, many projects are quite responsive to feedback and willing to amend their proposal.
We can def do more of this – but it’s addressing the symptom and not the cause. Our proposal intends to remove that kind of guesswork altogether.
It not about me or you, I am talking in general. We had seen this in past voting cycle as well, If an entity has stake in a project, they choose to abstain from their proposal.
If I’m understanding you correctly, you’re saying that delegates with personal stakes in protocols currently abstain from votes where there might be conflicts of interest. I think that’s fine – if fragile – as a means of preventing capture (as we’ve seen in politics).
In any case, what we’re proposing is a step away from these types of conflicts, as the only shift is the addition of governance to firms’ capital bases, not individuals. To say that personal conflicts would enter into it in a more significant way than in the status quo would be to say that governance itself is captured by individuals, which is an entirely different matter (one, incidentally, this proposal is also attempting to address).
I see here we have different opinion, from what I understood, GF funds are for token house and users holding token have say in this. Of course, at initial stage OP Foundation can decide to approve or reject it but only when a proposal is approved by token house.
I think we have the same understanding here. We were just saying that the OP Foundation should have by this point more than demonstrated their commitment to and interest in Optimism’s success as a primary matter.
2 Weeks would not be a problem, I was thinking a pause for months. Reason being, if we pause for months, there will be many proposal at once which would be hard to judge and manage.
Absolutely. In fact I’d be all in favor of proposing a cap on any sort of pause to keep distribution flowing.
I have chosen not to share my view on any comment related to token price.
I don’t want to overstep my bounds here with you, especially because I sympathize with this sentiment (and strictly adhere to it when it comes to Velodrome), but unfortunately in the case of funding public goods, the price is of relevance in that it dictates OP’s ability to do so.
I think we ought to be able to refer to its instrumentality to this end while avoiding the ugly speculative discussion that comes from hyperfocus on it. That is, of course, unless there is some sort of legal/regulatory reason to avoid any sort of mention.
I’ve noted in several posts that you are quite dismissive of ideas you do not personally agree wit…
I’ve noted in several posts that you are quite dismissive of ideas you do not personally agree with, without providing clear rational or full engagement with contrary arguments. Thank you for the feedback and I would love to extend my thoughts, could you please share the link. Why will Delegates voting on individual protocol’s proposals cause bias? If I have stake in Project X, I would choose to abstain from their proposal in GF round. This is how in general voting works, its nothing new. Can you please provide evidence for this assumption? Its not assumption, I am simply quoting what mentioned in project proposal. Again, choose not to comment on anything price related.
gabagool: thanks for your considerate reply, more of a general note on tone.
For example:
OPUser:
I would choose to abstain from their proposal in GF round. This is how in general voting works, its nothing new.
Is this explicitly stated in any of the rules around OP governance or delegation? I cannot find any mention of it, and therefor disagree that this is a norm that should be considered a rule to be followed.
Jack here. Many thanks for the considerate reply. Will respond per item. You are right here and I …
Jack here. Many thanks for the considerate reply. Will respond per item. You are right here and I am also looking at how it will turn out, you also know, those funds are already distributed and there no point discussing about it now. All we can do is wait, see and learn from it. Yes, absolutely. The last batch was intended as a demonstration to provide a sense of scale. Of relevance is the next batch (and so on), which is why we were asking to hold off on this series of grants, just for a week or two, to consider this proposal. We’ve submitted this proposal as a team, but I would volunteer to dedicate myself solely to this project to make sure we could get to consensus quickly enough to continue rewards. Again, I agree with you and like I mentioned earlier, best place to point this out is on project proposal so that they can work on it. I have seen, many projects are quite responsive to feedback and willing to amend their proposal. We can def do more of this – but it’s addressing the symptom and not the cause. Our proposal intends to remove that kind of guesswork altogether. It not about me or you, I am talking in general. We had seen this in past voting cycle as well, If an entity has stake in a project, they choose to abstain from their proposal. If I’m understanding you correctly, you’re saying that delegates with personal stakes in protocols currently abstain from votes where there might be conflicts of interest. I think that’s fine – if fragile – as a means of preventing capture (as we’ve seen in politics). In any case, what we’re proposing is a step away from these types of conflicts, as the only shift is the addition of governance to firms’ capital bases, not individuals. To say that personal conflicts would enter into it in a more significant way than in the status quo would be to say that governance itself is captured by individuals, which is an entirely different matter (one, incidentally, this proposal is also attempting to address). I see here we have different opinion, from what I understood, GF funds are for token house and users holding token have say in this. Of course, at initial stage OP Foundation can decide to approve or reject it but only when a proposal is approved by token house. I think we have the same understanding here. We were just saying that the OP Foundation should have by this point more than demonstrated their commitment to and interest in Optimism’s success as a primary matter. 2 Weeks would not be a problem, I was thinking a pause for months. Reason being, if we pause for months, there will be many proposal at once which would be hard to judge and manage. Absolutely. In fact I’d be all in favor of proposing a cap on any sort of pause to keep distribution flowing. I have chosen not to share my view on any comment related to token price. I don’t want to overstep my bounds here with you, especially because I sympathize with this sentiment (and strictly adhere to it when it comes to Velodrome), but unfortunately in the case of funding public goods, the price is of relevance in that it dictates OP’s ability to do so. I think we ought to be able to refer to its instrumentality to this end while avoiding the ugly speculative discussion that comes from hyperfocus on it. That is, of course, unless there is some sort of legal/regulatory reason to avoid any sort of mention.
jackanorak: having nothing Again, their stated goal here is more transactions, users, and li…
jackanorak: having nothing Again, their stated goal here is more transactions, users, and liquidity, which I think the current program is on track to accomplish. Optimism does get something out of these incentives. I am arguing that 25 % more incentives to fuel growth in those three metrics is more valuable than incentives for long-tail token liquidity against OP on AMMs that account for less than 30 % of Optimism DEX volumes. jackanorak: a distant, engineering-led, speculative approach to accrue value when we’re offering something concrete and data-driven that can be done now to meet an imminent need. So a network’s token accruing value from block production is “speculative” but pairing the token with long tail assets in constant product AMMs is “concrete” and “data-driven”. Gotcha. Could not disagree more. There is way more value for OP in block production than there is in “partnerships”. jackanorak: it’s not necessary to use a program such as Avalanche as a counterfactual. Why not? Those incentive programs grew their respective network in all of Optimism’s target metrics. They are great comparables and I am not sure why you want to dismiss them. I guess I do not feel the urgency you do or see this “imminent” need for utility. Incentives are about to kick off on almost all Optimism apps and Bedrock will be online later this year. I don’t buy the theory of the coming OP liquidity crisis, and as I mentioned, you did use unrealistic estimates. Also, I want to see the Optimism Collective do governance experiments, I just think this is a bad one! And I see hyperbole throughout the proposal, not just the suggestion that grants should stop.
jackanorak: This also means your OP sell pressure numbers are hypothetical and probably overstated. You assume every single OP token will be sold on the market which is misleading, I think it’s fair to assume at least some amount will be held or staked in liquidity pools.
I’m not so sure, considering the moral panic you seem to exhibit at the thought of impermanent loss. Feel free to back your assertion with some data on how much farmers LPing tokens A + B getting paid in token C choose to farm token C. Any seasoned farmer can tell you it would not be much. Or feel free to consider how much long-term holding or LPing you get from users getting incremental tokens for use rewards, or devs getting paid in OP.
And in any case, there would have to be substantial retention of tokens for there not to be a material impact. A 50% haircut in our estimates is still demonstrably intolerable if what we’re trying to swing as OP is sustained funding of public goods.
For any token incentive program, the most important measure is Emissions over Revenue . Projects almost always overpay for growth at the beginning ($1 of Emissions leads to less than $1 of fees), with the goal of flipping that ratio in the future. It’s worth noting that in Optimism’s case, the stated goal for OP incentives is that they not only lead to more transactions (revenue) but also more liquidity and users.
Why not? Those incentive programs grew their respective network in all of Optimism’s target metrics. They are great comparables and I am not sure why you want to dismiss them.
Again, there’s nothing in our proposal that impedes the growth of any of these things. It provides if anything more stable liquidity, thus facilitating more trades, investment, etc., better rates due to greater activity on lending and trading protocols, etc. We’re not saying the net effect ought to be any different from Avalanche Rush or any other programs –– the concrete benefit to these protocols and their users doesn’t change one iota. So yes, they’re good models for OP globally. No, they’re not a counterfactual here.
I guess I do not feel the urgency you do or see this “imminent” need for utility. Incentives are about to kick off on almost all Optimism apps and Bedrock will be online later this year. I don’t buy the theory of the coming OP liquidity crisis, and as I mentioned, you did use unrealistic estimates.
Even if you were to discount our estimates of sell pressure by 50% we’re talking about massive, sustained sell pressure by any reasonable measure. Saying you don’t “feel the urgency” without any evidence or modeling does not help anyone here make sound decisions.
And I see hyperbole throughout the proposal, not just the suggestion that grants should stop.
Would love to see specific examples of how we’ve strayed from data or reason. To answer the question of “what else is hyperbolic” by saying “well, it’s everywhere” isn’t productive.
So a network’s token accruing value from block production is “speculative” but pairing the token with long tail assets in constant product AMMs is “concrete” and “data-driven”. Gotcha. Could not disagree more. There is way more value for OP in block production than there is in “partnerships”.
Whether OP collectively resolves 1. what it’d look like, 2. whether it would outweigh potential risks, 3. ultimately whether to go with it, among other issues is, yes, a matter of speculation. Certainly it could accrue material value, and I’m not saying it’s the wrong path! I’ve had these conversations myself, and there’s much to be gained. But something like this being implemented is months and months away, and the sell pressure we’ve described is occurring as we speak with little other than market markers to mitigate it.
And in that time, the weeks and weeks of incentives being voted on by OP will depreciate, and so on. And, yes, what we’re describing is a mechanical buffer against this sell pressure that also happens to carry many side benefits. It’s a positive-sum construction.
Gotcha. Could not disagree more. There is way more value for OP in block production than there is in “partnerships”.
Not really sure where this adversarial tone is coming from. It’s not an either-or; it’s a matter of meeting needs as they come. Any sort of opinion you may have over what’s good or bad is more helpful when it’s backed by evidence or modeling.
jackanorak: reserves 25 OP and solicits 25 OP equivalent from partner protocols. Could y…
jackanorak: reserves 25 OP and solicits 25 OP equivalent from partner protocols. Could you please help me with this example: reserves 25 OP : who will get this and what would be its purpose, same question for 25 equivalent from partner
jackanorak: Instead of giving away 100 tokens, Optimism gives away 75 tokens and keeps 25 tokens for itself.
In return for other grants, some partner protocols may choose to offer some of their own tokens to Optimism, which then pools the 25 OP against protocols’ granted tokens in LPs throughout Optimism.
So now instead of having 0 tokens, Optimism now has custody of 25 OP tokens as well as equivalent value of other protocols’ tokens. So in addition to keeping some of its own tokens under the discretion of governance (possibly to be distributed later!), it also has tokens of OP-domiciled protocols. All of these tokens are used to increase liquidity throughout the ecosystem, and Optimism may choose to exercise governance rights through these partner protocols’ tokens.
forrest: While having the Optimism Collective act as meta-governance in the ecosystem might ac…
forrest: While having the Optimism Collective act as meta-governance in the ecosystem might accrue some value to the OP token, I think it would challenge the network’s claim of being credibly neutral. Optimism functions as an extension of Ethereum, and maintaining credible neutrality is a must. Optimism was already accused of showing certain apps favoritism, and this proposal could make things much worse. Just realized that we missed this question on an important topic - apologies. Would hope you’d expand on this thought, as we’ve struggled to find any direct line between our proposal and any sort of loss of credible neutrality. Governance is either neutral or not; what it has governance over ought not to affect neutrality. If your belief is that simply expanding the purview of governance leads to a loss of neutrality [don’t want to misrepresent tho], that implies the desire for highly limited governance, a view I’d really like to hear explained in light of what’s been posted on the forum to date.
Instead of giving away 100 tokens, Optimism gives away 75 tokens and keeps 25 tokens for itse…
Instead of giving away 100 tokens, Optimism gives away 75 tokens and keeps 25 tokens for itself. In return for other grants, some partner protocols may choose to offer some of their own tokens to Optimism, which then pools the 25 OP against protocols’ granted tokens in LPs throughout Optimism. So now instead of having 0 tokens, Optimism now has custody of 25 OP tokens as well as equivalent value of other protocols’ tokens. So in addition to keeping some of its own tokens under the discretion of governance (possibly to be distributed later!), it also has tokens of OP-domiciled protocols. All of these tokens are used to increase liquidity throughout the ecosystem, and Optimism may choose to exercise governance rights through these partner protocols’ tokens.
Netrim: But why do this? Optimism already has 5.4% Partner Fund and 8.8% Unallocated. If the core team wanted to do this, they can using those funds and such proposal could fall under a classic POL strategy or maybe someone creates a specific/innovative way of applying it.
OPUser: Lets take a step back, when you say
some of their own tokens to Optimism
are you referring to OP foundation ? If yes, then my understanding was right and let me give you one example.
Your suggestion:
Total number of OP distribution 100, 75 to project, 25 to LP along with 25 other from project receiving the grant. Just for discussion, assume value of each token is $1.
once approved, OP foundation gave 100 Token and got $50 worth of LP, right ? Ignoring impermanent loss.
What about this, OP foundation give 50 to project(without asking anything in return from the project) and out of other 50, buys $25 worth of other project token and do the LP. Here also, foundation gave 100 and still has $50 worth of LP. Sounds weird right ?
You also mentioned that having other project token will give OP foundation right in the said project DAO, right ? First, that is a up to OP foundation if they want to take this responsibility and second, such foundation level change is out of our scope, that kind of change need approval from both house (token and citizen)
But why do this? Optimism already has 5 . 4 % Partner Fund and 8 . 8 % Unallocated. If the core t…
But why do this? Optimism already has 5 . 4 % Partner Fund and 8 . 8 % Unallocated. If the core team wanted to do this, they can using those funds and such proposal could fall under a classic POL strategy or maybe someone creates a specific/innovative way of applying it.
jackanorak: We do this because it’s a positive-sum means of offering to grantees a service they’re already asking for while generating more meaning for governance and cohesion between OP governance and constituent protocols.
Same service, more bang for everyone’s buck. Save the unallocated for non-redundant initiatives once we figure out what to do with it.
This also means your OP sell pressure numbers are hypothetical and probably overstated. You assume…
This also means your OP sell pressure numbers are hypothetical and probably overstated. You assume every single OP token will be sold on the market which is misleading, I think it’s fair to assume at least some amount will be held or staked in liquidity pools. I’m not so sure, considering the moral panic you seem to exhibit at the thought of impermanent loss. Feel free to back your assertion with some data on how much farmers LPing tokens A + B getting paid in token C choose to farm token C. Any seasoned farmer can tell you it would not be much. Or feel free to consider how much long-term holding or LPing you get from users getting incremental tokens for use rewards, or devs getting paid in OP. And in any case, there would have to be substantial retention of tokens for there not to be a material impact. A 50 % haircut in our estimates is still demonstrably intolerable if what we’re trying to swing as OP is sustained funding of public goods. For any token incentive program, the most important measure is Emissions over Revenue . Projects almost always overpay for growth at the beginning ($ 1 of Emissions leads to less than $ 1 of fees), with the goal of flipping that ratio in the future. It’s worth noting that in Optimism’s case, the stated goal for OP incentives is that they not only lead to more transactions (revenue) but also more liquidity and users. Why not? Those incentive programs grew their respective network in all of Optimism’s target metrics. They are great comparables and I am not sure why you want to dismiss them. Again, there’s nothing in our proposal that impedes the growth of any of these things. It provides if anything more stable liquidity, thus facilitating more trades, investment, etc., better rates due to greater activity on lending and trading protocols, etc. We’re not saying the net effect ought to be any different from Avalanche Rush or any other programs –– the concrete benefit to these protocols and their users doesn’t change one iota. So yes, they’re good models for OP globally. No, they’re not a counterfactual here. I guess I do not feel the urgency you do or see this “imminent” need for utility. Incentives are about to kick off on almost all Optimism apps and Bedrock will be online later this year. I don’t buy the theory of the coming OP liquidity crisis, and as I mentioned, you did use unrealistic estimates. Even if you were to discount our estimates of sell pressure by 50 % we’re talking about massive, sustained sell pressure by any reasonable measure. Saying you don’t “feel the urgency” without any evidence or modeling does not help anyone here make sound decisions. And I see hyperbole throughout the proposal, not just the suggestion that grants should stop. Would love to see specific examples of how we’ve strayed from data or reason. To answer the question of “what else is hyperbolic” by saying “well, it’s everywhere” isn’t productive. So a network’s token accruing value from block production is “speculative” but pairing the token with long tail assets in constant product AMMs is “concrete” and “data-driven”. Gotcha. Could not disagree more. There is way more value for OP in block production than there is in “partnerships”. Whether OP collectively resolves 1 . what it’d look like, 2 . whether it would outweigh potential risks, 3 . ultimately whether to go with it, among other issues is, yes, a matter of speculation. Certainly it could accrue material value, and I’m not saying it’s the wrong path! I’ve had these conversations myself, and there’s much to be gained. But something like this being implemented is months and months away, and the sell pressure we’ve described is occurring as we speak with little other than market markers to mitigate it. And in that time, the weeks and weeks of incentives being voted on by OP will depreciate, and so on. And, yes, what we’re describing is a mechanical buffer against this sell pressure that also happens to carry many side benefits. It’s a positive-sum construction. Gotcha. Could not disagree more. There is way more value for OP in block production than there is in “partnerships”. Not really sure where this adversarial tone is coming from. It’s not an either-or; it’s a matter of meeting needs as they come. Any sort of opinion you may have over what’s good or bad is more helpful when it’s backed by evidence or modeling.
forrest: jackanorak:
considering the moral panic you seem to exhibit at the thought of impermanent loss
It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasury’s balance sheet. Not going to argue with you about impermanent loss, in this scenario it would, in some capacity, occur on some of the Collective’s liquidity positions.
jackanorak:
evidence or modeling
Your “modeling” is the assumption that every OP token that goes to users in the next 6 months is going to be market sold on an Optimism DEX in the current state of unincentivized Optimism liquidity. I find this unrealistic and pointed to previous network incentive campaigns where enough growth and liquidity were generated to counteract the natural selling pressure that token incentives bring.
jackanorak:
If your broadsides are the result of some fear of self-interest, you can come right out and say it.
Velodrome self-interest is not my concern with this proposal, I think it would be a poor allocation of the Collective’s treasury.
This proposal tries to lock in 25% of OP token incentives for “pairing” on long-tail AMM pairs. If a protocol wants to do this with its own OP grant, great! But why standardize this? The top of funnel for OP incentives should remain open-ended.
jackanorak:
For transparency, of course.
Am I wrong? Given that liquidity mining on the dominant liquidity venue on the network, Uniswap V3, is not very approachable, Velodrome stands the most to benefit from this proposal. That’s all I said.
I will get back to you with my concerns on the metagovernance bit.
We do this because it’s a positive-sum means of offering to grantees a service they’re already aski…
We do this because it’s a positive-sum means of offering to grantees a service they’re already asking for while generating more meaning for governance and cohesion between OP governance and constituent protocols. Same service, more bang for everyone’s buck. Save the unallocated for non-redundant initiatives once we figure out what to do with it.
Who is asking for this? First time this was raised was this thread. But this is not redundant, this…
Who is asking for this? First time this was raised was this thread. But this is not redundant, this is a change, I would say a constituent change. The other issue I am not understand is who is going to own the created LP, since Optimism provides OP, the dex provides their token? So in the case of Velodrone, it would be VELO. But then you need to create the LP for it, and that LP will have only one owner. If your proposal tries to tackle price, too early to tell and like others have said, many assumptions on your initial post, some of which I don’t agree. If your proposal tries to tackle governance participation, the issue is very different and this proposal does nothing.
forrest: The project that stands to benefit most from the proposal is the one drafting it. Just stating this for transparency.
jackanorak: Who is asking for this?
First time this was raised was this thread.
35% of all approved OP for distribution has been for the purpose of incentivizing liquidity on a dex. We’re offering an alternative means to achieve the thing protocols are directly calling for. That’s what I mean by redundancy.
The other issue I am not understand is who is going to own the created LP, since Optimism provides OP, the dex provides their token? So in the case of Velodrone, it would be VELO. But then you need to create the LP for it, and that LP will have only one owner.
The owner of the LP would be the Optimism Collective. They would be LPing the tokens, they’d have governance rights over the consitituent tokens, and they would be earning fees and emissions on these tokens.
If your proposal tries to tackle price, too early to tell and like others have said, many assumptions on your initial post, some of which I don’t agree.
Then feel free to substantively rebut our estimates or assumptions. So far nobody has.
If your proposal tries to tackle governance participation, the issue is very different and this proposal does nothing.
Again, please substantiate with a thesis. Ours is this: governance participation will increase when governance participation means more than who gets to distribute tokens. Having direct ability to help inform the direction of constituent protocols is a meaningful step forward for the Collective and is in our view among the most powerful possible draws to participation. I’ve read the forums and haven’t seen a compelling alternative raised so far. If there’s one you have in mind, please direct me.
The project that stands to benefit most from the proposal is the one drafting it. Just stating this…
The project that stands to benefit most from the proposal is the one drafting it. Just stating this for transparency.
We’ve already stated that this absolutely doesn’t have to be on Velodrome, and liquidity is going t…
We’ve already stated that this absolutely doesn’t have to be on Velodrome, and liquidity is going to go onto our or other platforms one way or another through liq mining. So net benefit for us is actually marginal and possibly negative, as this is essentially free (i.e., not bribed or rented) liquidity for the protocols. If your broadsides are the result of some fear of self-interest, you can come right out and say it. But it’s really not our intention here; this is a genuine attempt to bring real, actionable ideas to the Collective, one I’m confident is among the first raised here.
forrest: jackanorak:
considering the moral panic you seem to exhibit at the thought of impermanent loss
It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasury’s balance sheet. Not going to argue with you about impermanent loss, in this scenario it would, in some capacity, occur on some of the Collective’s liquidity positions.
jackanorak:
evidence or modeling
Your “modeling” is the assumption that every OP token that goes to users in the next 6 months is going to be market sold on an Optimism DEX in the current state of unincentivized Optimism liquidity. I find this unrealistic and pointed to previous network incentive campaigns where enough growth and liquidity were generated to counteract the natural selling pressure that token incentives bring.
jackanorak:
If your broadsides are the result of some fear of self-interest, you can come right out and say it.
Velodrome self-interest is not my concern with this proposal, I think it would be a poor allocation of the Collective’s treasury.
This proposal tries to lock in 25% of OP token incentives for “pairing” on long-tail AMM pairs. If a protocol wants to do this with its own OP grant, great! But why standardize this? The top of funnel for OP incentives should remain open-ended.
jackanorak:
For transparency, of course.
Am I wrong? Given that liquidity mining on the dominant liquidity venue on the network, Uniswap V3, is not very approachable, Velodrome stands the most to benefit from this proposal. That’s all I said.
I will get back to you with my concerns on the metagovernance bit.
forrest: jackanorak:
considering the moral panic you seem to exhibit at the thought of impermanent loss
It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasury’s balance sheet. Not going to argue with you about impermanent loss, in this scenario it would, in some capacity, occur on some of the Collective’s liquidity positions.
jackanorak:
evidence or modeling
Your “modeling” is the assumption that every OP token that goes to users in the next 6 months is going to be market sold on an Optimism DEX in the current state of unincentivized Optimism liquidity. I find this unrealistic and pointed to previous network incentive campaigns where enough growth and liquidity were generated to counteract the natural selling pressure that token incentives bring.
jackanorak:
If your broadsides are the result of some fear of self-interest, you can come right out and say it.
Velodrome self-interest is not my concern with this proposal, I think it would be a poor allocation of the Collective’s treasury.
This proposal tries to lock in 25% of OP token incentives for “pairing” on long-tail AMM pairs. If a protocol wants to do this with its own OP grant, great! But why standardize this? The top of funnel for OP incentives should remain open-ended.
jackanorak:
For transparency, of course.
Am I wrong? Given that liquidity mining on the dominant liquidity venue on the network, Uniswap V3, is not very approachable, Velodrome stands the most to benefit from this proposal. That’s all I said.
I will get back to you with my concerns on the metagovernance bit.
Lets take a step back, when you say some of their own tokens to Optimism are you referring to OP …
Lets take a step back, when you say some of their own tokens to Optimism are you referring to OP foundation ? If yes, then my understanding was right and let me give you one example. Your suggestion: Total number of OP distribution 100 , 75 to project, 25 to LP along with 25 other from project receiving the grant. Just for discussion, assume value of each token is $ 1 . once approved, OP foundation gave 100 Token and got $ 50 worth of LP, right ? Ignoring impermanent loss. What about this, OP foundation give 50 to project(without asking anything in return from the project) and out of other 50 , buys $ 25 worth of other project token and do the LP. Here also, foundation gave 100 and still has $ 50 worth of LP. Sounds weird right ? You also mentioned that having other project token will give OP foundation right in the said project DAO, right ? First, that is a up to OP foundation if they want to take this responsibility and second, such foundation level change is out of our scope, that kind of change need approval from both house (token and citizen)
OPUser: not to mention, we are asking project a co-incentive, most of them are matching the grant by $1:1
jackanorak: What about this, OP foundation give 50 to project(without asking anything in return from the project) and out of other 50, buys $25 worth of other project token and do the LP. Here also, foundation gave 100 and still has $50 worth of LP. Sounds weird right ?
Actually think this would be just fine! No problems at all with this; it’s a model we support.
But there’s an element of coordination to the proposal as we’ve laid out, especially in that it helps signal to protocols that they don’t need to bribe/incentivize as much for their liquidity.
You also mentioned that having other project token will give OP foundation right in the said project DAO, right ? First, that is a up to OP foundation if they want to take this responsibility and second, such foundation level change is out of our scope, that kind of change need approval from both house (token and citizen)
This is a helpful procedural point we’re certainly willing to get guidance on in trying to get this done. One way or another, a new proposal has to be made in the first place. We’re here making that proposal.
not to mention, we are asking project a co-incentive, most of them are matching the grant by $ 1 : 1
not to mention, we are asking project a co-incentive, most of them are matching the grant by $ 1 : 1
jackanorak: not to mention, we are asking project a co-incentive, most of them are matching the grant by $1:1
This is a great point in support of our plan that we’d missed; protocols are already donating their tokens to get liquidity. This actually makes the full accounting of the plan much more feasible, as we can credibly say that these participating protocols are able and willing to offer their tokens for liquidity.
Who is asking for this? First time this was raised was this thread. 35 % of all approved OP for …
Who is asking for this? First time this was raised was this thread. 35 % of all approved OP for distribution has been for the purpose of incentivizing liquidity on a dex. We’re offering an alternative means to achieve the thing protocols are directly calling for. That’s what I mean by redundancy. The other issue I am not understand is who is going to own the created LP, since Optimism provides OP, the dex provides their token? So in the case of Velodrone, it would be VELO. But then you need to create the LP for it, and that LP will have only one owner. The owner of the LP would be the Optimism Collective. They would be LPing the tokens, they’d have governance rights over the consitituent tokens, and they would be earning fees and emissions on these tokens. If your proposal tries to tackle price, too early to tell and like others have said, many assumptions on your initial post, some of which I don’t agree. Then feel free to substantively rebut our estimates or assumptions. So far nobody has. If your proposal tries to tackle governance participation, the issue is very different and this proposal does nothing. Again, please substantiate with a thesis. Ours is this: governance participation will increase when governance participation means more than who gets to distribute tokens. Having direct ability to help inform the direction of constituent protocols is a meaningful step forward for the Collective and is in our view among the most powerful possible draws to participation. I’ve read the forums and haven’t seen a compelling alternative raised so far. If there’s one you have in mind, please direct me.
Netrim: The owner of the LP would be the Optimism Collective. They would be LPing the tokens, they’d have governance rights over the constituent tokens, and they would be earning fees and emissions on these tokens.
If the Optimism Collective wants to create such endeavor, they would need to create such a proposal and go thru both houses.
Then feel free to substantively rebut our estimates or assumptions. So far nobody has.
Napkin math here. Of the 40M to be distributed over Phase0, around 18M have been done so far. Those protocols haven’t started with their incentives. The End.
On a side note: It’s clever to frame the discussion here for price since discord has a strict no price talk.
If your proposal tries to tackle governance participation, the issue is very different and this proposal does nothing.
There is a governance apathy because people being people (Solving voter apathy) , will only look at their own short term incentives. The second issue is the delegation/voting excludes all but OP sitting in a wallet. You can’t LP it and you can do anything remotely composable for it. If you want to create a meaningful or different product that will have an outstanding backlash from the community, create a wrapper for OP, make it composable for yield and/or money market, and used the underlying OP for delegation to yourself.
As a final note, this forum is very active on the topics that draw interest (not counting the users that create an account to make one comment at the behest of some protocol’s proposal). That your proposal has garnered 29 responses in less than 24hs, BUT all of them are rebutals, should tell you everything you need to know on why it’s incorrectly framed.
not to mention, we are asking project a co-incentive, most of them are matching the grant by $ 1 :…
not to mention, we are asking project a co-incentive, most of them are matching the grant by $ 1 : 1 This is a great point in support of our plan that we’d missed; protocols are already donating their tokens to get liquidity. This actually makes the full accounting of the plan much more feasible, as we can credibly say that these participating protocols are able and willing to offer their tokens for liquidity.
What about this, OP foundation give 50 to project(without asking anything in return from the pro…
What about this, OP foundation give 50 to project(without asking anything in return from the project) and out of other 50 , buys $ 25 worth of other project token and do the LP. Here also, foundation gave 100 and still has $ 50 worth of LP. Sounds weird right ? Actually think this would be just fine! No problems at all with this; it’s a model we support. But there’s an element of coordination to the proposal as we’ve laid out, especially in that it helps signal to protocols that they don’t need to bribe/incentivize as much for their liquidity. You also mentioned that having other project token will give OP foundation right in the said project DAO, right ? First, that is a up to OP foundation if they want to take this responsibility and second, such foundation level change is out of our scope, that kind of change need approval from both house (token and citizen) This is a helpful procedural point we’re certainly willing to get guidance on in trying to get this done. One way or another, a new proposal has to be made in the first place. We’re here making that proposal.
OPUser: okey, so let me summarize this.
Example I gave is absurd as we are creating liquidity by diluting our own token. I would like to see them being used and believe GF fund is doing the same, sure here also token will be diluted but there is fair chance that we will be able to fund and support a project proposal which will help in on-boarding new users, liquidity and innovation.
Also, I would like to point out and you might have read this too as you mentioned reading all the proposals, going forward most delegate, including me, are looking for more than just LP reward in a proposal.
We’re here making that proposal.
This is good move, having early discussion will help us all. But like I said, you need to wait until both house are live and I expect citizen house to be active in next few month(just my random guess).
That’s all I have to say as now, will be reading the thread and jump in if I needed.
The owner of the LP would be the Optimism Collective. They would be LPing the tokens, they’d have …
The owner of the LP would be the Optimism Collective. They would be LPing the tokens, they’d have governance rights over the constituent tokens, and they would be earning fees and emissions on these tokens. If the Optimism Collective wants to create such endeavor, they would need to create such a proposal and go thru both houses. Then feel free to substantively rebut our estimates or assumptions. So far nobody has. Napkin math here. Of the 40 M to be distributed over Phase 0 , around 18 M have been done so far. Those protocols haven’t started with their incentives. The End. On a side note: It’s clever to frame the discussion here for price since discord has a strict no price talk. If your proposal tries to tackle governance participation, the issue is very different and this proposal does nothing. There is a governance apathy because people being people (Solving voter apathy) , will only look at their own short term incentives. The second issue is the delegation/voting excludes all but OP sitting in a wallet. You can’t LP it and you can do anything remotely composable for it. If you want to create a meaningful or different product that will have an outstanding backlash from the community, create a wrapper for OP, make it composable for yield and/or money market, and used the underlying OP for delegation to yourself. As a final note, this forum is very active on the topics that draw interest (not counting the users that create an account to make one comment at the behest of some protocol’s proposal). That your proposal has garnered 29 responses in less than 24 hs, BUT all of them are rebutals, should tell you everything you need to know on why it’s incorrectly framed.
jackanorak: If the Optimism Collective wants to create such endeavor, they would need to create such a proposal and go thru both houses.
Responded to OPUser with this, but sure. Whatever the process ultimately has to be, we can follow it to get the job done.
Napkin math here. Of the 40M to be distributed over Phase0, around 18M have been done so far. Those protocols haven’t started with their incentives. The End.
Not really sure the point you’re trying to make other than that the entirety of the sell pressure is ahead of us, though we’re certainly excited to see the uptick in activity!
On a side note: It’s clever to frame the discussion here for price since discord has a strict no price talk.
Not really sure how this is relevant; we never even considered going to Discord first, as this proposal sits outside the scope of any individual grant. The only reason we posted in this section vs others was that it pertained to the GF program as a whole and we didn’t want to be presumptuous in posting in a top-level forum.
There is a governance apathy because people being people)) , will only look at their own short term incentives. The second issue is the delegation/voting excludes all but OP sitting in a wallet. You can’t LP it and you can do anything remotely composable for it. If you want to create a meaningful or different product that will have an outstanding backlash from the community, create a wrapper for OP, make it composable for yield and/or money market, and used the underlying OP for delegation to yourself.
“People being people” is exactly why increasing the stakes ought to increase participation. We’re not at all at odds here. And I’d love to see wrappers enabling governance rights for tokens in these other forms; one of the consulting devs on the Velodrome project has been banging on that drum for years. In the meantime, why not focus on immediate possibilities that can get results and participation for this highly critical time?
As a final note, this forum is very active on the topics that draw interest (not counting the users that create an account to make one comment at the behest of some protocol’s proposal).
If you’re referring to dcao above, he is an independent (though friendly) trader who was trolling us in an attempt to undermine our proposal because he is publicly very short OP. His posts are very obviously ridiculing us. If you’re referring to some other protocols, ya there’s evidence of that.
That your proposal has garnered 29 responses in less than 24hs, BUT all of them are rebutals, should tell you everything you need to know on why it’s incorrectly framed.
The majority of these responses are three people separately going in a back and forth with me. I hope you don’t call that governance, consensus, or even signal. And OPUser (don’t want to speak for them), while pushing back, has suggested an openness and curiosity, which is what any person making a proposal would hope to see!
okey, so let me summarize this. Example I gave is absurd as we are creating liquidity by diluting o…
okey, so let me summarize this. Example I gave is absurd as we are creating liquidity by diluting our own token. I would like to see them being used and believe GF fund is doing the same, sure here also token will be diluted but there is fair chance that we will be able to fund and support a project proposal which will help in on-boarding new users, liquidity and innovation. Also, I would like to point out and you might have read this too as you mentioned reading all the proposals, going forward most delegate, including me, are looking for more than just LP reward in a proposal. We’re here making that proposal. This is good move, having early discussion will help us all. But like I said, you need to wait until both house are live and I expect citizen house to be active in next few month(just my random guess). That’s all I have to say as now, will be reading the thread and jump in if I needed.
jackanorak: Example I gave is absurd as we are creating liquidity by diluting our own token. I would like to see them being used and believe GF fund is doing the same, sure here also token will be diluted but there is fair chance that we will be able to fund and support a project proposal which will help in on-boarding new users, liquidity and innovation.
It’s not absurd because 75 OP are being market sold one way or another and the other 25OP are being reserved. What makes it inefficient is the fuller accounting of what’s occurring in that the protocol is not getting the 25 extra OP of value in exchange for its token.
Also, I would like to point out and you might have read this too as you mentioned reading all the proposals, going forward most delegate, including me, are looking for more than just LP reward in a proposal.
It really can’t be lost that we are insisting on continuing grants as they are (for all their multifarious purposes), just with some portion of the 35%-ish of liquidity mining OP instead being used for this LP purpose.
This is good move, having early discussion will help us all. But like I said, you need to wait until both house are live and I expect citizen house to be active in next few month(just my random guess).
So any sort of meta-governance is off the table until this next piece comes online? In that case we insist on getting a definitive answer on this issue because we don’t see much reason to wait for another piece of the structure to come online unless there’s an obvious reason for it.
If the Optimism Collective wants to create such endeavor, they would need to create such a proposa…
If the Optimism Collective wants to create such endeavor, they would need to create such a proposal and go thru both houses. Responded to OPUser with this, but sure. Whatever the process ultimately has to be, we can follow it to get the job done. Napkin math here. Of the 40 M to be distributed over Phase 0 , around 18 M have been done so far. Those protocols haven’t started with their incentives. The End. Not really sure the point you’re trying to make other than that the entirety of the sell pressure is ahead of us, though we’re certainly excited to see the uptick in activity! On a side note: It’s clever to frame the discussion here for price since discord has a strict no price talk. Not really sure how this is relevant; we never even considered going to Discord first, as this proposal sits outside the scope of any individual grant. The only reason we posted in this section vs others was that it pertained to the GF program as a whole and we didn’t want to be presumptuous in posting in a top-level forum. There is a governance apathy because people being people)) , will only look at their own short term incentives. The second issue is the delegation/voting excludes all but OP sitting in a wallet. You can’t LP it and you can do anything remotely composable for it. If you want to create a meaningful or different product that will have an outstanding backlash from the community, create a wrapper for OP, make it composable for yield and/or money market, and used the underlying OP for delegation to yourself. “People being people” is exactly why increasing the stakes ought to increase participation. We’re not at all at odds here. And I’d love to see wrappers enabling governance rights for tokens in these other forms; one of the consulting devs on the Velodrome project has been banging on that drum for years. In the meantime, why not focus on immediate possibilities that can get results and participation for this highly critical time? As a final note, this forum is very active on the topics that draw interest (not counting the users that create an account to make one comment at the behest of some protocol’s proposal). If you’re referring to dcao above, he is an independent (though friendly) trader who was trolling us in an attempt to undermine our proposal because he is publicly very short OP. His posts are very obviously ridiculing us. If you’re referring to some other protocols, ya there’s evidence of that. That your proposal has garnered 29 responses in less than 24 hs, BUT all of them are rebutals, should tell you everything you need to know on why it’s incorrectly framed. The majority of these responses are three people separately going in a back and forth with me. I hope you don’t call that governance, consensus, or even signal. And OPUser (don’t want to speak for them), while pushing back, has suggested an openness and curiosity, which is what any person making a proposal would hope to see!
OPUser: jackanorak:
three people separately going in a back and forth with me
lol…sorry to push you there, like I said, I am still learning and sometime I needs more information to make a decision.
image 882 × 702 130 KB
Yeah for example I think this proposal falls clearly under Phase 1 be…
image 882 × 702 130 KB
Yeah for example I think this proposal falls clearly under Phase 1 because it entails a use of distributable tokens for a specific purpose, and these tokens are matched. This is simply talking about what to do with the Phase 1 tokens, no? Seems pretty neat.
jackanorak:
I think this proposal falls clearly under Phase 1 because it entails a use of di…
jackanorak:
I think this proposal falls clearly under Phase 1 because it entails a use of distributable tokens for a specific purpose
[DRAFT] [GF: META] Proposal to reserve a share of GF distribution for liquidity backstopping and stronger governance ?Other Proposals
We are going in circle here, I feel.
Owning the LP address and related responsibility that will come with it will be a task for OP foundation.
In order for us to recommend this, we need approval from Both house.
jackanorak: considering the moral panic you seem to exhibit at the thought of impermanent loss…
jackanorak: considering the moral panic you seem to exhibit at the thought of impermanent loss It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasury’s balance sheet. Not going to argue with you about impermanent loss, in this scenario it would, in some capacity, occur on some of the Collective’s liquidity positions. jackanorak: evidence or modeling Your “modeling” is the assumption that every OP token that goes to users in the next 6 months is going to be market sold on an Optimism DEX in the current state of unincentivized Optimism liquidity. I find this unrealistic and pointed to previous network incentive campaigns where enough growth and liquidity were generated to counteract the natural selling pressure that token incentives bring. jackanorak: If your broadsides are the result of some fear of self-interest, you can come right out and say it. Velodrome self-interest is not my concern with this proposal, I think it would be a poor allocation of the Collective’s treasury. This proposal tries to lock in 25 % of OP token incentives for “pairing” on long-tail AMM pairs. If a protocol wants to do this with its own OP grant, great! But why standardize this? The top of funnel for OP incentives should remain open-ended. jackanorak: For transparency, of course. Am I wrong? Given that liquidity mining on the dominant liquidity venue on the network, Uniswap V 3 , is not very approachable, Velodrome stands the most to benefit from this proposal. That’s all I said. I will get back to you with my concerns on the metagovernance bit.
jackanorak: It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasury’s balance sheet. Not going to argue with you about impermanent loss, in this scenario it would, in some capacity, occur on some of the Collective’s liquidity positions.
Area Man unsure whether accepting free $100 a good idea:
“What if I lose $10?” he wonders
The risk is trivial when you’re comparing it against giving away the entire position. You can’t seriously be continuing on this point.
Your “modeling” is the assumption that every OP token that goes to users in the next 6 months is going to be market sold on an Optimism DEX in the current state of unincentivized Optimism liquidity. I find this unrealistic and pointed to previous network incentive campaigns where enough growth and liquidity were generated to counteract the natural selling pressure that token incentives bring.
It’s an illustrative model for which i’ve already noted there is a substantial buffer within which the sell effect continues to be intolerable. And who is going to incentivize the LPing of OP tokens? Haven’t seen any proposals detailing those specifically. Let’s say there’s 50% less selling on 50% more LP (HIGHLY generous): that would be 3.3mm sold on 15mm, still over 20% of all LPed tokens sold per month. Are you actually okay with this?
This proposal tries to lock in 25% of OP token incentives for “pairing” on long-tail AMM pairs. If a protocol wants to do this with its own OP grant, great! But why standardize this?
The 25% was a sample amount and subject to discussion, but standardization as an option (and potentially a requirement) is a good one because it makes clear and puts into action Optimism’s commitment to 1) supporting OP as an ongoing means of funding public goods, 2) supporting enduring liquidity and facilitation of market performance, and 3) expanding the scope and stakes of its governance.
The top of funnel for OP incentives should remain open-ended.
It still would be; again, this is ultimately about increasing and sustaining OP incentives for all kinds of initiatives.
Am I wrong? Given that liquidity mining on the dominant liquidity venue on the network, Uniswap V3, is not very approachable, Velodrome stands the most to benefit from this proposal. That’s all I said
You are, and it’s okay to be wrong, though I appreciate the implied compliment that we are a dominant player on Optimism.
Already explained why the marginal effect of this proposal passing (even if we were to get all of the liqudity) is insignificant and possibly a liability; if we are that dominant, all the liq mining rewards in the status quo are going to veVELO holders (i.e., not LPs) directly as revenue. If this proposal passes, we lose a big chunk of that.
But we’re still coming from behind. Synthetix, Perpetual, and Lyra, the largest players, continue to do most of their incentivization on Curve and v3. Beethoven and Zipswap are also certainly relevant as outlets.
jackanorak: three people separately going in a back and forth with me lol…sorry to push you …
jackanorak: three people separately going in a back and forth with me lol…sorry to push you there, like I said, I am still learning and sometime I needs more information to make a decision.
Example I gave is absurd as we are creating liquidity by diluting our own token. I would like to s…
Example I gave is absurd as we are creating liquidity by diluting our own token. I would like to see them being used and believe GF fund is doing the same, sure here also token will be diluted but there is fair chance that we will be able to fund and support a project proposal which will help in on-boarding new users, liquidity and innovation. It’s not absurd because 75 OP are being market sold one way or another and the other 25 OP are being reserved. What makes it inefficient is the fuller accounting of what’s occurring in that the protocol is not getting the 25 extra OP of value in exchange for its token. Also, I would like to point out and you might have read this too as you mentioned reading all the proposals, going forward most delegate, including me, are looking for more than just LP reward in a proposal. It really can’t be lost that we are insisting on continuing grants as they are (for all their multifarious purposes), just with some portion of the 35 %-ish of liquidity mining OP instead being used for this LP purpose. This is good move, having early discussion will help us all. But like I said, you need to wait until both house are live and I expect citizen house to be active in next few month(just my random guess). So any sort of meta-governance is off the table until this next piece comes online? In that case we insist on getting a definitive answer on this issue because we don’t see much reason to wait for another piece of the structure to come online unless there’s an obvious reason for it.
Netrim: So any sort of meta-governance is off the table until this next piece comes online? In that case we insist on getting a definitive answer on this issue because we don’t see much reason to wait for another piece of the structure to come online unless there’s an obvious reason for it.
The obvious reason is that The primary responsibility of the Citizens’ House will be funding those public goods which have the most positive impact on the Optimism and Ethereum ecosystems. as detailed here This Governance Will Self Destruct — The Optimism Collective
OPUser: jackanorak:
So any sort of meta-governance is off the table until this next piece comes online
Unfortunately, yes. This demands constitutional change which need both house approval, as @Netrim has mentioned.
But I am not from OP team and if you feel its something urgent and time sensitive matter, please jump in our discord and check with them.
One thing i like about DAO is chautic co-ordination and just because we have different opinion does not mean either of us a wrong, it just that we see differently.
I would suggest you two thing, jump in to our discord(gov-temp-check channel) and seek feedback on this, that might help you move things faster and second would wait until you have some support here from other users and/or delegates.
So any sort of meta-governance is off the table until this next piece comes online? In that case w…
So any sort of meta-governance is off the table until this next piece comes online? In that case we insist on getting a definitive answer on this issue because we don’t see much reason to wait for another piece of the structure to come online unless there’s an obvious reason for it. The obvious reason is that The primary responsibility of the Citizens’ House will be funding those public goods which have the most positive impact on the Optimism and Ethereum ecosystems. as detailed here This Governance Will Self Destruct — The Optimism Collective 2
jackanorak: Okay, now you’re grasping. If this were the final word, there would be no voting on any OP grants at all. Think we’ll have to do our own research.
It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasur…
It is worth noting that this proposal would introduce a new type of risk onto the Optimism Treasury’s balance sheet. Not going to argue with you about impermanent loss, in this scenario it would, in some capacity, occur on some of the Collective’s liquidity positions. Area Man unsure whether accepting free $ 100 a good idea: “What if I lose $ 10 ?” he wonders The risk is trivial when you’re comparing it against giving away the entire position. You can’t seriously be continuing on this point. Your “modeling” is the assumption that every OP token that goes to users in the next 6 months is going to be market sold on an Optimism DEX in the current state of unincentivized Optimism liquidity. I find this unrealistic and pointed to previous network incentive campaigns where enough growth and liquidity were generated to counteract the natural selling pressure that token incentives bring. It’s an illustrative model for which i’ve already noted there is a substantial buffer within which the sell effect continues to be intolerable. And who is going to incentivize the LPing of OP tokens? Haven’t seen any proposals detailing those specifically. Let’s say there’s 50 % less selling on 50 % more LP (HIGHLY generous): that would be 3 . 3 mm sold on 15 mm, still over 20 % of all LPed tokens sold per month. Are you actually okay with this? This proposal tries to lock in 25 % of OP token incentives for “pairing” on long-tail AMM pairs. If a protocol wants to do this with its own OP grant, great! But why standardize this? The 25 % was a sample amount and subject to discussion, but standardization as an option (and potentially a requirement) is a good one because it makes clear and puts into action Optimism’s commitment to 1 ) supporting OP as an ongoing means of funding public goods, 2 ) supporting enduring liquidity and facilitation of market performance, and 3 ) expanding the scope and stakes of its governance. The top of funnel for OP incentives should remain open-ended. It still would be; again, this is ultimately about increasing and sustaining OP incentives for all kinds of initiatives. Am I wrong? Given that liquidity mining on the dominant liquidity venue on the network, Uniswap V 3 , is not very approachable, Velodrome stands the most to benefit from this proposal. That’s all I said You are, and it’s okay to be wrong, though I appreciate the implied compliment that we are a dominant player on Optimism. Already explained why the marginal effect of this proposal passing (even if we were to get all of the liqudity) is insignificant and possibly a liability; if we are that dominant, all the liq mining rewards in the status quo are going to veVELO holders (i.e., not LPs) directly as revenue. If this proposal passes, we lose a big chunk of that. But we’re still coming from behind. Synthetix, Perpetual, and Lyra, the largest players, continue to do most of their incentivization on Curve and v 3 . Beethoven and Zipswap are also certainly relevant as outlets.
Okay, now you’re grasping. If this were the final word, there would be no voting on any OP grants a…
Okay, now you’re grasping. If this were the final word, there would be no voting on any OP grants at all. Think we’ll have to do our own research.
No, it’s sincerely been a good exercise. Hope it’s been meaningful for you.
No, it’s sincerely been a good exercise. Hope it’s been meaningful for you.
jackanorak: So any sort of meta-governance is off the table until this next piece comes online…
jackanorak: So any sort of meta-governance is off the table until this next piece comes online Unfortunately, yes. This demands constitutional change which need both house approval, as @Netrim has mentioned. But I am not from OP team and if you feel its something urgent and time sensitive matter, please jump in our discord and check with them. One thing i like about DAO is chautic co-ordination and just because we have different opinion does not mean either of us a wrong, it just that we see differently. I would suggest you two thing, jump in to our discord(gov-temp-check channel) and seek feedback on this, that might help you move things faster and second would wait until you have some support here from other users and/or delegates.
Sure thing. But the OP Team already viewed this proposal at several levels and deemed it appropriat…
Sure thing. But the OP Team already viewed this proposal at several levels and deemed it appropriate for review under the current structure, so seems like an unnecessary step. Still haven’t seen anything definitive indicating that what we’re proposing entails a constitutional disruption.
OPUser: jackanorak:
Still haven’t seen anything definitive indicating that what we’re proposing entails a constitutional disruption
We are going in circle here, I feel.
Owning the LP address and related responsibility that will come with it will be a task for OP foundation.
In order for us to recommend this, we need approval from Both house.
jackanorak: Still haven’t seen anything definitive indicating that what we’re proposing entail…
jackanorak: Still haven’t seen anything definitive indicating that what we’re proposing entails a constitutional disruption We are going in circle here, I feel. Owning the LP address and related responsibility that will come with it will be a task for OP foundation. In order for us to recommend this, we need approval from Both house.
For sure. You’re making this assertion, and I’m trying to determine whether it’s true. Will researc…
For sure. You’re making this assertion, and I’m trying to determine whether it’s true. Will research and consult. But questions about process shouldn’t limit discussion on this proposal on its merits.
Think we’d need an authoritative voice to make this claim; there’s already mention of OP treasury a…
Think we’d need an authoritative voice to make this claim; there’s already mention of OP treasury actions in scope for the Token House, so custodying tokens to provide a service doesn’t seem to be an issue.
Questions around actual governance operations could maybe wait for the Foundation/Citizens, but at worst waiting for them to clear those sorts of actions doesn’t prevent the first step here.
OPUser: I am not sure if this pointed towards me or just an open question to everyone but I got notification so replying. I would really appreciate if you could tag me if a question is directly pointed towards me.
jackanorak:
so custodying tokens to provide a service doesn’t seem to be an issue.
I think we can agree to disagree, you dont see this as an issue and I do.
Not that I support of this proposal but I like that you are quite motivated about this and want to have a discussion. So, my suggestion would be,
update the proposal with exact words, who will own the LP address, OP foundation ? or someone else ? This need clear answer.
What would you suggest to do with the LP rewards. Give some of your suggestion ?
How long will this LP last ? Who will make a call do dilute the LP and /or its rewards.
Do you see Impermanent loss as a problem? What would you recommend to mitigate this ?
Assuming we have other project token and want to participate in their DAO
How this will work ? Lets say OP foundation has the token owned by multi-sig, now who will vote and participate in the DAO ? will it be foundation or the delegates ?
Update this to the proposal, if you have already answered them, please link them to the proposal.
and please remember to tag me if any comment is pointed directly towards me.
Yes please, supporting document will help. My source of knowledge is OPerating manual. This is what…
Yes please, supporting document will help. My source of knowledge is OPerating manual. This is what comes under gov funding proposal. image 1364 × 381 37 . 6 KB “OPerating Manual of the Optimism Collective (v 0 . 1 . 2 ) [OLD]” And I dont see this proposal fitting in any catorgy mentioned there, So this requires updating the OPerating manual which need to be done by OP Foundation. But questions about process shouldn’t limit discussion on this proposal on its merits. Sure.
thanks for your considerate reply, more of a general note on tone.
For example:
OPUser:
I woul…
thanks for your considerate reply, more of a general note on tone.
For example:
OPUser:
I would choose to abstain from their proposal in GF round. This is how in general voting works, its nothing new.
Is this explicitly stated in any of the rules around OP governance or delegation? I cannot find any mention of it, and therefor disagree that this is a norm that should be considered a rule to be followed.
OPUser: gabagool:
Is this explicitly stated in any of the rules around OP governance or delegation? I
No, its not mentioned anywhere in OP manual as this is normal and expected behavior in gov voting.
and therefor disagree that this is a norm that should be considered a rule to be followed
Understandable, I would not insist you to be on an agreement with me. I was merely sharing what I believe and would expect others to do so, its not a must to agree with my view and opinion.
image 882 × 702 130 KB Yeah for example I think this proposal falls clearly under Phase 1 be…
image 882 × 702 130 KB Yeah for example I think this proposal falls clearly under Phase 1 because it entails a use of distributable tokens for a specific purpose, and these tokens are matched. This is simply talking about what to do with the Phase 1 tokens, no? Seems pretty neat.
jackanorak: I think this proposal falls clearly under Phase 1 because it entails a use of di…
jackanorak: I think this proposal falls clearly under Phase 1 because it entails a use of distributable tokens for a specific purpose [DRAFT] [GF: META] Proposal to reserve a share of GF distribution for liquidity backstopping and stronger governance ?Other Proposals We are going in circle here, I feel. Owning the LP address and related responsibility that will come with it will be a task for OP foundation. In order for us to recommend this, we need approval from Both house.
Think we’d need an authoritative voice to make this claim; there’s already mention of OP treasury a…
Think we’d need an authoritative voice to make this claim; there’s already mention of OP treasury actions in scope for the Token House, so custodying tokens to provide a service doesn’t seem to be an issue. Questions around actual governance operations could maybe wait for the Foundation/Citizens, but at worst waiting for them to clear those sorts of actions doesn’t prevent the first step here.
OPUser: I am not sure if this pointed towards me or just an open question to everyone but I got notification so replying. I would really appreciate if you could tag me if a question is directly pointed towards me.
jackanorak:
so custodying tokens to provide a service doesn’t seem to be an issue.
I think we can agree to disagree, you dont see this as an issue and I do.
Not that I support of this proposal but I like that you are quite motivated about this and want to have a discussion. So, my suggestion would be,
update the proposal with exact words, who will own the LP address, OP foundation ? or someone else ? This need clear answer.
What would you suggest to do with the LP rewards. Give some of your suggestion ?
How long will this LP last ? Who will make a call do dilute the LP and /or its rewards.
Do you see Impermanent loss as a problem? What would you recommend to mitigate this ?
Assuming we have other project token and want to participate in their DAO
How this will work ? Lets say OP foundation has the token owned by multi-sig, now who will vote and participate in the DAO ? will it be foundation or the delegates ?
Update this to the proposal, if you have already answered them, please link them to the proposal.
and please remember to tag me if any comment is pointed directly towards me.
I am not sure if this pointed towards me or just an open question to everyone but I got notificatio…
I am not sure if this pointed towards me or just an open question to everyone but I got notification so replying. I would really appreciate if you could tag me if a question is directly pointed towards me.
jackanorak:
so custodying tokens to provide a service doesn’t seem to be an issue.
I think we can agree to disagree, you dont see this as an issue and I do.
Not that I support of this proposal but I like that you are quite motivated about this and want to have a discussion. So, my suggestion would be,
update the proposal with exact words, who will own the LP address, OP foundation ? or someone else ? This need clear answer.
What would you suggest to do with the LP rewards. Give some of your suggestion ?
How long will this LP last ? Who will make a call do dilute the LP and /or its rewards.
Do you see Impermanent loss as a problem? What would you recommend to mitigate this ?
Assuming we have other project token and want to participate in their DAO
How this will work ? Lets say OP foundation has the token owned by multi-sig, now who will vote and participate in the DAO ? will it be foundation or the delegates ?
Update this to the proposal, if you have already answered them, please link them to the proposal.
and please remember to tag me if any comment is pointed directly towards me.
gabagool:
Is this explicitly stated in any of the rules around OP governance or delegation? I
…
gabagool:
Is this explicitly stated in any of the rules around OP governance or delegation? I
No, its not mentioned anywhere in OP manual as this is normal and expected behavior in gov voting.
and therefor disagree that this is a norm that should be considered a rule to be followed
Understandable, I would not insist you to be on an agreement with me. I was merely sharing what I believe and would expect others to do so, its not a must to agree with my view and opinion.
gabagool: OPUser:
No, its not mentioned anywhere in OP manual as this is normal and expected behavior in gov voting.
can you please provide context as to how you arrive at this opinion?
I am personally a delegate and will be participating in governance discussions and do not have this belief in the slightest. Ty!
thanks for your considerate reply, more of a general note on tone. For example: OPUser: I woul…
thanks for your considerate reply, more of a general note on tone. For example: OPUser: I would choose to abstain from their proposal in GF round. This is how in general voting works, its nothing new. Is this explicitly stated in any of the rules around OP governance or delegation? I cannot find any mention of it, and therefor disagree that this is a norm that should be considered a rule to be followed.
OPUser: gabagool:
Is this explicitly stated in any of the rules around OP governance or delegation? I
No, its not mentioned anywhere in OP manual as this is normal and expected behavior in gov voting.
and therefor disagree that this is a norm that should be considered a rule to be followed
Understandable, I would not insist you to be on an agreement with me. I was merely sharing what I believe and would expect others to do so, its not a must to agree with my view and opinion.
I am someone who was drawn to the Vision Optimism laid out several months ago. Impact resonates wit…
I am someone who was drawn to the Vision Optimism laid out several months ago. Impact resonates with me very deeply and I have been quite engaged with the rollup since learning about the plans and Public Goods and thinking of new ways to contribute.
I believe this is not a good Proposal and would not benefit Optimism.
If what you say is true about your very close collaboration and relationship with OP Labs; I really don’t understand or know what to say because it seems so at odds with the stated Vision.
I’ve noticed lately that nearly evey time I read a post like this whether in the Optimism discord or forum, I Ieave feeling more pessimistic about DeFi; and I’ve never had this experience.
I am definitely not in favor of this in any capacity.
gabagool: 0xWeston:
If what you say is true about your very close collaboration and relationship with OP Labs; I really don’t understand or know what to say because it seems so at odds with the stated Vision.
Yes it is true, we have worked closely with Optimism Foundation, they funded the launch of our project with a grant and Partnership team reviewed this proposal prior to publication and deemed it appropriate for consideration under current frameworks.
jackanorak: This is a conflicted post by a member of a competing dex on Optimism, on whose own active proposal
I made a factual statement and offered no opinion or judgment. The facts I offered are inconvenient for his cause.
In response, he’s maligned our protocol’s intent and commitment to the Optimism Collective with no meaningful statement on this proposal’s merits. I hope readers will consider his post with this in mind.
Some additional context is provided in that other thread, and I don’t wish to drag out any ugliness by commenting further.
I am not sure if this pointed towards me or just an open question to everyone but I got notificatio…
I am not sure if this pointed towards me or just an open question to everyone but I got notification so replying. I would really appreciate if you could tag me if a question is directly pointed towards me. jackanorak: so custodying tokens to provide a service doesn’t seem to be an issue. I think we can agree to disagree, you dont see this as an issue and I do. Not that I support of this proposal but I like that you are quite motivated about this and want to have a discussion. So, my suggestion would be, update the proposal with exact words, who will own the LP address, OP foundation ? or someone else ? This need clear answer. What would you suggest to do with the LP rewards. Give some of your suggestion ? How long will this LP last ? Who will make a call do dilute the LP and /or its rewards. Do you see Impermanent loss as a problem? What would you recommend to mitigate this ? Assuming we have other project token and want to participate in their DAO How this will work ? Lets say OP foundation has the token owned by multi-sig, now who will vote and participate in the DAO ? will it be foundation or the delegates ? Update this to the proposal, if you have already answered them, please link them to the proposal. and please remember to tag me if any comment is pointed directly towards me.
gabagool: Is this explicitly stated in any of the rules around OP governance or delegation? I …
gabagool: Is this explicitly stated in any of the rules around OP governance or delegation? I No, its not mentioned anywhere in OP manual as this is normal and expected behavior in gov voting. and therefor disagree that this is a norm that should be considered a rule to be followed Understandable, I would not insist you to be on an agreement with me. I was merely sharing what I believe and would expect others to do so, its not a must to agree with my view and opinion.
gabagool: OPUser:
No, its not mentioned anywhere in OP manual as this is normal and expected behavior in gov voting.
can you please provide context as to how you arrive at this opinion?
I am personally a delegate and will be participating in governance discussions and do not have this belief in the slightest. Ty!
I am someone who was drawn to the Vision Optimism laid out several months ago. Impact resonates wit…
I am someone who was drawn to the Vision Optimism laid out several months ago. Impact resonates with me very deeply and I have been quite engaged with the rollup since learning about the plans and Public Goods and thinking of new ways to contribute. I believe this is not a good Proposal and would not benefit Optimism. If what you say is true about your very close collaboration and relationship with OP Labs; I really don’t understand or know what to say because it seems so at odds with the stated Vision. I’ve noticed lately that nearly evey time I read a post like this whether in the Optimism discord or forum, I Ieave feeling more pessimistic about DeFi; and I’ve never had this experience. I am definitely not in favor of this in any capacity.
gabagool: 0xWeston:
If what you say is true about your very close collaboration and relationship with OP Labs; I really don’t understand or know what to say because it seems so at odds with the stated Vision.
Yes it is true, we have worked closely with Optimism Foundation, they funded the launch of our project with a grant and Partnership team reviewed this proposal prior to publication and deemed it appropriate for consideration under current frameworks.
jackanorak: This is a conflicted post by a member of a competing dex on Optimism, on whose own active proposal
I made a factual statement and offered no opinion or judgment. The facts I offered are inconvenient for his cause.
In response, he’s maligned our protocol’s intent and commitment to the Optimism Collective with no meaningful statement on this proposal’s merits. I hope readers will consider his post with this in mind.
Some additional context is provided in that other thread, and I don’t wish to drag out any ugliness by commenting further.
0 xWeston:
If what you say is true about your very close collaboration and relationship with …
0 xWeston:
If what you say is true about your very close collaboration and relationship with OP Labs; I really don’t understand or know what to say because it seems so at odds with the stated Vision.
Yes it is true, we have worked closely with Optimism Foundation, they funded the launch of our project with a grant and Partnership team reviewed this proposal prior to publication and deemed it appropriate for consideration under current frameworks.
OPUser:
No, its not mentioned anywhere in OP manual as this is normal and expected behavior in…
OPUser:
No, its not mentioned anywhere in OP manual as this is normal and expected behavior in gov voting.
can you please provide context as to how you arrive at this opinion?
I am personally a delegate and will be participating in governance discussions and do not have this belief in the slightest. Ty!
hey @gabagool I am happy that you are curious but I dont see how sharing my opinion will change you…
hey @gabagool I am happy that you are curious but I dont see how sharing my opinion will change your belief and ideally it should not.
One approach would be to discuss this as a new idea, you can create a tread and involve other users to get their feedback and opinion on this. feel free to quote any comment that i have mention if you need it as an example.
hey @bobby @vonnie 610 , is this true ? I thought pre-check of proposals from OP foundation was on…
hey @bobby @vonnie 610 , is this true ? I thought pre-check of proposals from OP foundation was only for Phase 0 .
bobby: The Velodrome team did share this proposal with members of the Optimism team before posting on this forum. This is not an endorsement or “pre-check” of the proposal contents, but their statement is true.
Sharing my own opinion as an individual: I think this is a valid Phase 1 proposal because it’s still describing a potential token allocation from the GovFund — but instead of distributing those tokens to a project, they’re held for liquidity pairing.
how do we know if you are not trolling us by saying that op team reviewed this proposal and support…
how do we know if you are not trolling us by saying that op team reviewed this proposal and supported it @gabagool @jackanorak
This is a conflicted post by a member of a competing dex on Optimism, on whose own active proposal …
This is a conflicted post by a member of a competing dex on Optimism, on whose own active proposal 1
I made a factual statement and offered no opinion or judgment. The facts I offered are inconvenient for his cause.
In response, he’s maligned our protocol’s intent and commitment to the Optimism Collective with no meaningful statement on this proposal’s merits. I hope readers will consider his post with this in mind.
Some additional context is provided in that other thread, and I don’t wish to drag out any ugliness by commenting further.
The Velodrome team did share this proposal with members of the Optimism team before posting on this…
The Velodrome team did share this proposal with members of the Optimism team before posting on this forum. This is not an endorsement or “pre-check” of the proposal contents, but their statement is true.
Sharing my own opinion as an individual: I think this is a valid Phase 1 proposal because it’s still describing a potential token allocation from the GovFund — but instead of distributing those tokens to a project, they’re held for liquidity pairing.
jackanorak: Appreciate the clarifications earlier. Now that we’ve settled questions about process, I’ll turn to the individual q’s you posted earlier, as they’re similar to the open questions we laid out in the original proposal. There is enough overlap where I’d rather post them here, and then once we’ve discussed, we can amend.
Excited to get back to the proposal at hand.
Who will own the LP address, OP foundation ? or someone else ? This need clear answer.
Foundation multisig is probably the most low-friction way to custody this while final governance is sorted out.
What would you suggest to do with the LP rewards. Give some of your suggestion ?
In our initial proposal, we left this an open question and invited thoughts. The three primary actions are:
Sell LP rewards to compound LP positions, possibly through autocompounder
Compound LP rewards into more capacity to influence broader liquidity
– if v3, possibly buy back OP for more public good distribution or acquire votepower in a veDEX
– if veDEX model, such as Velo or Curve, accumulate voting tokens to gain general votepower
Sell LP rewards for some other purpose
–Buy back OP for public good investment
–Acquire more governance of partner protocols
–(pending legal clearance, lol) general treasury mgmt
As you can see, there are a few different paths, but each of them presents an interesting opportunity for the Collective.
My personal suggestion would be some combination of compounding voteshare and buying back OP, both of which directly free up Governance’s hand to facilitate more funding, but this is very much an area where I’d invite some other perspectives.
How long will this LP last ? Who will make a call do dilute the LP and /or its rewards.
Our thinking was that this would be more or less permanent until the protocol signaled a lack of need, at which point the funds would be at Optimism’s disposal. We could say that Optimism commits to holding protocols’ governance tokens in perpetuity while reclaiming its OP for more public goods distribution.
Do you see Impermanent loss as a problem? What would you recommend to mitigate this ?
As an impediment to passing this proposal, no. The analogy I used above is that it’s silly to refuse to accept $100 of free money because you’re worried you might lose $10 of that.
The primary reason for doing this in the first place is to take OP you were already going to give away and put it to work for the same purpose it was originally being requested for–but also put it to work for you. How efficiently it works for you is secondary because your alternative is getting 0 value for yourself.
As an operating matter, yes there are possibilities to mitigate this, but I believe it’s downstream of getting something like this passed.
How this will work ? Lets say OP foundation has the token owned by multi-sig, now who will vote and participate in the DAO ? will it be foundation or the delegates?
This is a super exciting area where I don’t have a clear direction! I think this is a much, much bigger question on which I would be thrilled to have this proposal spark discussion.
Fortunately, even if this passed we would have some time to sort it out. Of primary importance is meeting protocols’ liquidity needs, which currently represent over 1/3 of all approved OP distributions.
0 xWeston: If what you say is true about your very close collaboration and relationship with …
0 xWeston: If what you say is true about your very close collaboration and relationship with OP Labs; I really don’t understand or know what to say because it seems so at odds with the stated Vision. Yes it is true, we have worked closely with Optimism Foundation, they funded the launch of our project with a grant and Partnership team reviewed this proposal prior to publication and deemed it appropriate for consideration under current frameworks.
OPUser: No, its not mentioned anywhere in OP manual as this is normal and expected behavior in…
OPUser: No, its not mentioned anywhere in OP manual as this is normal and expected behavior in gov voting. can you please provide context as to how you arrive at this opinion? I am personally a delegate and will be participating in governance discussions and do not have this belief in the slightest. Ty!
hey @gabagool I am happy that you are curious but I dont see how sharing my opinion will change you…
hey @gabagool I am happy that you are curious but I dont see how sharing my opinion will change your belief and ideally it should not. One approach would be to discuss this as a new idea, you can create a tread and involve other users to get their feedback and opinion on this. feel free to quote any comment that i have mention if you need it as an example.
hey @bobby @vonnie 610 , is this true ? I thought pre-check of proposals from OP foundation was on…
hey @bobby @vonnie 610 , is this true ? I thought pre-check of proposals from OP foundation was only for Phase 0 .
bobby: The Velodrome team did share this proposal with members of the Optimism team before posting on this forum. This is not an endorsement or “pre-check” of the proposal contents, but their statement is true.
Sharing my own opinion as an individual: I think this is a valid Phase 1 proposal because it’s still describing a potential token allocation from the GovFund — but instead of distributing those tokens to a project, they’re held for liquidity pairing.
how do we know if you are not trolling us by saying that op team reviewed this proposal and support…
how do we know if you are not trolling us by saying that op team reviewed this proposal and supported it @gabagool @jackanorak
This is a conflicted post by a member of a competing dex on Optimism, on whose own active proposal …
This is a conflicted post by a member of a competing dex on Optimism, on whose own active proposal 1 I made a factual statement and offered no opinion or judgment. The facts I offered are inconvenient for his cause. In response, he’s maligned our protocol’s intent and commitment to the Optimism Collective with no meaningful statement on this proposal’s merits. I hope readers will consider his post with this in mind. Some additional context is provided in that other thread, and I don’t wish to drag out any ugliness by commenting further.
The Velodrome team did share this proposal with members of the Optimism team before posting on this…
The Velodrome team did share this proposal with members of the Optimism team before posting on this forum. This is not an endorsement or “pre-check” of the proposal contents, but their statement is true. Sharing my own opinion as an individual: I think this is a valid Phase 1 proposal because it’s still describing a potential token allocation from the GovFund — but instead of distributing those tokens to a project, they’re held for liquidity pairing.
jackanorak: Appreciate the clarifications earlier. Now that we’ve settled questions about process, I’ll turn to the individual q’s you posted earlier, as they’re similar to the open questions we laid out in the original proposal. There is enough overlap where I’d rather post them here, and then once we’ve discussed, we can amend.
Excited to get back to the proposal at hand.
Who will own the LP address, OP foundation ? or someone else ? This need clear answer.
Foundation multisig is probably the most low-friction way to custody this while final governance is sorted out.
What would you suggest to do with the LP rewards. Give some of your suggestion ?
In our initial proposal, we left this an open question and invited thoughts. The three primary actions are:
Sell LP rewards to compound LP positions, possibly through autocompounder
Compound LP rewards into more capacity to influence broader liquidity
– if v3, possibly buy back OP for more public good distribution or acquire votepower in a veDEX
– if veDEX model, such as Velo or Curve, accumulate voting tokens to gain general votepower
Sell LP rewards for some other purpose
–Buy back OP for public good investment
–Acquire more governance of partner protocols
–(pending legal clearance, lol) general treasury mgmt
As you can see, there are a few different paths, but each of them presents an interesting opportunity for the Collective.
My personal suggestion would be some combination of compounding voteshare and buying back OP, both of which directly free up Governance’s hand to facilitate more funding, but this is very much an area where I’d invite some other perspectives.
How long will this LP last ? Who will make a call do dilute the LP and /or its rewards.
Our thinking was that this would be more or less permanent until the protocol signaled a lack of need, at which point the funds would be at Optimism’s disposal. We could say that Optimism commits to holding protocols’ governance tokens in perpetuity while reclaiming its OP for more public goods distribution.
Do you see Impermanent loss as a problem? What would you recommend to mitigate this ?
As an impediment to passing this proposal, no. The analogy I used above is that it’s silly to refuse to accept $100 of free money because you’re worried you might lose $10 of that.
The primary reason for doing this in the first place is to take OP you were already going to give away and put it to work for the same purpose it was originally being requested for–but also put it to work for you. How efficiently it works for you is secondary because your alternative is getting 0 value for yourself.
As an operating matter, yes there are possibilities to mitigate this, but I believe it’s downstream of getting something like this passed.
How this will work ? Lets say OP foundation has the token owned by multi-sig, now who will vote and participate in the DAO ? will it be foundation or the delegates?
This is a super exciting area where I don’t have a clear direction! I think this is a much, much bigger question on which I would be thrilled to have this proposal spark discussion.
Fortunately, even if this passed we would have some time to sort it out. Of primary importance is meeting protocols’ liquidity needs, which currently represent over 1/3 of all approved OP distributions.
(I work for OP Labs, but this reflects my own opinion. I have worked closely with the Velodrome tea…
(I work for OP Labs, but this reflects my own opinion. I have worked closely with the Velodrome team.)
I think this proposal makes a lot of sense.
For obvious legal reasons, OP Labs & employees do not discuss token value, but I don’t think I will rock anyone’s socks if I say that a strong token opens more possibilities for governance to make an impact. I love to see a proposal in this direction, even just as a side effect.
I will also second the fact that liquidity is a real need. I often hear from the bizdev team that liquidity is one of the main concerns of projects. The situation has largely improved already, but it’s still possible to do much better.
Giving the collective governance power in protocols is also something you like to see. It’s a good way to maintain alignment. I think there can even be a discussion about projects having the ability to use their LP funds to vote in Optimism governance. Projects are important and valued actors whose voice should carry weight (though this should be made very carefully, to avoid projects having a disproportionate governance weight). My take away from the recent situation with the delegation of Perpetual Protocol’s OP allocation is that we’d like to give protocol a voice, but we have to be mindful that it does not take over the voices of other token holders.
Finally, we have to be cognizant that there are many dexes on Optimism, and we can’t be playing favorite. On the other hand, this is not Optimism, not Communism and I would like to see the market play a role. I think a fairly simple solution is to let projects decide on which dex they want to deposit their liquidity (subject to governance approval to avoids griefs such as creating a new dex specially for the occasion). They will do what is in their best interest, competition will play its role, and hopefully all will be well. (To be fair, this is implied in the proposal, which mentions Velodrome and Curve, I think it’s worth spelling explicitly though.)
Velodrome did indeed draft this, so I do expect they are confident they’ll be able to benefit from the proposal (though I do think everyone in the ecosystem benefits from it becoming stronger). They don’t have to be the only dex benefitting however.
There’s been a lot of back-and-forth in this thread between the Velodrome team and other parties from other dexes. I’d love to see what less directly involved member of the community think as well.
Appreciate the clarifications earlier. Now that we’ve settled questions about process, I’ll turn to…
Appreciate the clarifications earlier. Now that we’ve settled questions about process, I’ll turn to the individual q’s you posted earlier, as they’re similar to the open questions we laid out in the original proposal. There is enough overlap where I’d rather post them here, and then once we’ve discussed, we can amend.
Excited to get back to the proposal at hand.
Who will own the LP address, OP foundation ? or someone else ? This need clear answer.
Foundation multisig is probably the most low-friction way to custody this while final governance is sorted out.
What would you suggest to do with the LP rewards. Give some of your suggestion ?
In our initial proposal, we left this an open question and invited thoughts. The three primary actions are:
Sell LP rewards to compound LP positions, possibly through autocompounder
Compound LP rewards into more capacity to influence broader liquidity
– if v 3 , possibly buy back OP for more public good distribution or acquire votepower in a veDEX
– if veDEX model, such as Velo or Curve, accumulate voting tokens to gain general votepower
Sell LP rewards for some other purpose
–Buy back OP for public good investment
–Acquire more governance of partner protocols
–(pending legal clearance, lol) general treasury mgmt
As you can see, there are a few different paths, but each of them presents an interesting opportunity for the Collective.
My personal suggestion would be some combination of compounding voteshare and buying back OP, both of which directly free up Governance’s hand to facilitate more funding, but this is very much an area where I’d invite some other perspectives.
How long will this LP last ? Who will make a call do dilute the LP and /or its rewards.
Our thinking was that this would be more or less permanent until the protocol signaled a lack of need, at which point the funds would be at Optimism’s disposal. We could say that Optimism commits to holding protocols’ governance tokens in perpetuity while reclaiming its OP for more public goods distribution.
Do you see Impermanent loss as a problem? What would you recommend to mitigate this ?
As an impediment to passing this proposal, no. The analogy I used above is that it’s silly to refuse to accept $ 100 of free money because you’re worried you might lose $ 10 of that.
The primary reason for doing this in the first place is to take OP you were already going to give away and put it to work for the same purpose it was originally being requested for–but also put it to work for you. How efficiently it works for you is secondary because your alternative is getting 0 value for yourself.
As an operating matter, yes there are possibilities to mitigate this, but I believe it’s downstream of getting something like this passed.
How this will work ? Lets say OP foundation has the token owned by multi-sig, now who will vote and participate in the DAO ? will it be foundation or the delegates?
This is a super exciting area where I don’t have a clear direction! I think this is a much, much bigger question on which I would be thrilled to have this proposal spark discussion.
Fortunately, even if this passed we would have some time to sort it out. Of primary importance is meeting protocols’ liquidity needs, which currently represent over 1 / 3 of all approved OP distributions.
(I work for OP Labs, but this reflects my own opinion. I have worked closely with the Velodrome tea…
(I work for OP Labs, but this reflects my own opinion. I have worked closely with the Velodrome team.) I think this proposal makes a lot of sense. For obvious legal reasons, OP Labs & employees do not discuss token value, but I don’t think I will rock anyone’s socks if I say that a strong token opens more possibilities for governance to make an impact. I love to see a proposal in this direction, even just as a side effect. I will also second the fact that liquidity is a real need. I often hear from the bizdev team that liquidity is one of the main concerns of projects. The situation has largely improved already, but it’s still possible to do much better. Giving the collective governance power in protocols is also something you like to see. It’s a good way to maintain alignment. I think there can even be a discussion about projects having the ability to use their LP funds to vote in Optimism governance. Projects are important and valued actors whose voice should carry weight (though this should be made very carefully, to avoid projects having a disproportionate governance weight). My take away from the recent situation with the delegation of Perpetual Protocol’s OP allocation is that we’d like to give protocol a voice, but we have to be mindful that it does not take over the voices of other token holders. Finally, we have to be cognizant that there are many dexes on Optimism, and we can’t be playing favorite. On the other hand, this is not Optimism, not Communism and I would like to see the market play a role. I think a fairly simple solution is to let projects decide on which dex they want to deposit their liquidity (subject to governance approval to avoids griefs such as creating a new dex specially for the occasion). They will do what is in their best interest, competition will play its role, and hopefully all will be well. (To be fair, this is implied in the proposal, which mentions Velodrome and Curve, I think it’s worth spelling explicitly though.) Velodrome did indeed draft this, so I do expect they are confident they’ll be able to benefit from the proposal (though I do think everyone in the ecosystem benefits from it becoming stronger). They don’t have to be the only dex benefitting however. There’s been a lot of back-and-forth in this thread between the Velodrome team and other parties from other dexes. I’d love to see what less directly involved member of the community think as well.
Appreciate the clarifications earlier. Now that we’ve settled questions about process, I’ll turn to…
Appreciate the clarifications earlier. Now that we’ve settled questions about process, I’ll turn to the individual q’s you posted earlier, as they’re similar to the open questions we laid out in the original proposal. There is enough overlap where I’d rather post them here, and then once we’ve discussed, we can amend. Excited to get back to the proposal at hand. Who will own the LP address, OP foundation ? or someone else ? This need clear answer. Foundation multisig is probably the most low-friction way to custody this while final governance is sorted out. What would you suggest to do with the LP rewards. Give some of your suggestion ? In our initial proposal, we left this an open question and invited thoughts. The three primary actions are: Sell LP rewards to compound LP positions, possibly through autocompounder Compound LP rewards into more capacity to influence broader liquidity – if v 3 , possibly buy back OP for more public good distribution or acquire votepower in a veDEX – if veDEX model, such as Velo or Curve, accumulate voting tokens to gain general votepower Sell LP rewards for some other purpose –Buy back OP for public good investment –Acquire more governance of partner protocols –(pending legal clearance, lol) general treasury mgmt As you can see, there are a few different paths, but each of them presents an interesting opportunity for the Collective. My personal suggestion would be some combination of compounding voteshare and buying back OP, both of which directly free up Governance’s hand to facilitate more funding, but this is very much an area where I’d invite some other perspectives. How long will this LP last ? Who will make a call do dilute the LP and /or its rewards. Our thinking was that this would be more or less permanent until the protocol signaled a lack of need, at which point the funds would be at Optimism’s disposal. We could say that Optimism commits to holding protocols’ governance tokens in perpetuity while reclaiming its OP for more public goods distribution. Do you see Impermanent loss as a problem? What would you recommend to mitigate this ? As an impediment to passing this proposal, no. The analogy I used above is that it’s silly to refuse to accept $ 100 of free money because you’re worried you might lose $ 10 of that. The primary reason for doing this in the first place is to take OP you were already going to give away and put it to work for the same purpose it was originally being requested for–but also put it to work for you. How efficiently it works for you is secondary because your alternative is getting 0 value for yourself. As an operating matter, yes there are possibilities to mitigate this, but I believe it’s downstream of getting something like this passed. How this will work ? Lets say OP foundation has the token owned by multi-sig, now who will vote and participate in the DAO ? will it be foundation or the delegates? This is a super exciting area where I don’t have a clear direction! I think this is a much, much bigger question on which I would be thrilled to have this proposal spark discussion. Fortunately, even if this passed we would have some time to sort it out. Of primary importance is meeting protocols’ liquidity needs, which currently represent over 1 / 3 of all approved OP distributions.
OPUser: Process wise, we are still there but like I said, you are motivated about this so I am joining the conversation, may be I am missing something here.
Last time when we try to involve foundation with joining multi-sig with different project they said no because of bureaucracy, So I would start with getting their permission here. Are they willing to take this responsibility. If you are able to resolve this, then I would agree that we have made some progress.
jackanorak:
Foundation multisig is probably the most low-friction way to custody this while final governance is sorted out.
This proposal will impact all upcoming proposals, So I would assume this going to voting on snapshot and for that reason, If I were you, I would do some math here and extend the analogy.
We know how many token are left in GF fund, you are proposing 25% from from our side and 25% from project side. Run some number and show us the data with, even if it has 10% of variance.
As an impediment to passing this proposal, no. The analogy I used above is that it’s silly to refuse to accept $100 of free money because you’re worried you might lose $10 of that.
We have gone through this many time and I dont agree with this logic. So, i wont repeat again.
The primary reason for doing this in the first place is to take OP you were already going to give away and put it to work for the same purpose it was originally being requested for–but also put it to work for you. How efficiently it works for you is secondary because your alternative is getting 0 value for yourself.
Few other thoughts:-
What about those project that does not have token or cant afford to give 25% of their share ?
Buying OP and putting into foundation treasury would be a good idea where both house would vote to distribute it to public good.
I would remove DAO all together if foundation is accepting to hold the address, or mention specifically that decision(on other project DAO) will be done by OP Token house, foundation role would be just cast those votes. Goal here is to keep Foundation as neutral as possible.
We are asking projects to give co-incentives, are you planning to keep that part or remove it ?
Also put 5 dex of your choice where you want to keep the LP.
Would you suggest putting all in a single dex or distribute it between 3-5 ?
Dex selection should also need voting, I think ?
In order for anyone to call Velodrome bias because you are drafting this proposal, I would suggest taking a voting snapshot of the date this proposal was submitted.
Process wise, we are still there but like I said, you are motivated about this so I am joining the …
Process wise, we are still there but like I said, you are motivated about this so I am joining the conversation, may be I am missing something here.
Last time when we try to involve foundation with joining multi-sig with different project they said no because of bureaucracy, So I would start with getting their permission here. Are they willing to take this responsibility. If you are able to resolve this, then I would agree that we have made some progress.
jackanorak:
Foundation multisig is probably the most low-friction way to custody this while final governance is sorted out.
This proposal will impact all upcoming proposals, So I would assume this going to voting on snapshot and for that reason, If I were you, I would do some math here and extend the analogy.
We know how many token are left in GF fund, you are proposing 25 % from from our side and 25 % from project side. Run some number and show us the data with, even if it has 10 % of variance.
As an impediment to passing this proposal, no. The analogy I used above is that it’s silly to refuse to accept $ 100 of free money because you’re worried you might lose $ 10 of that.
We have gone through this many time and I dont agree with this logic. So, i wont repeat again.
The primary reason for doing this in the first place is to take OP you were already going to give away and put it to work for the same purpose it was originally being requested for–but also put it to work for you. How efficiently it works for you is secondary because your alternative is getting 0 value for yourself.
Few other thoughts:-
What about those project that does not have token or cant afford to give 25 % of their share ?
Buying OP and putting into foundation treasury would be a good idea where both house would vote to distribute it to public good.
I would remove DAO all together if foundation is accepting to hold the address, or mention specifically that decision(on other project DAO) will be done by OP Token house, foundation role would be just cast those votes. Goal here is to keep Foundation as neutral as possible.
We are asking projects to give co-incentives, are you planning to keep that part or remove it ?
Also put 5 dex of your choice where you want to keep the LP.
Would you suggest putting all in a single dex or distribute it between 3 - 5 ?
Dex selection should also need voting, I think ?
In order for anyone to call Velodrome bias because you are drafting this proposal, I would suggest taking a voting snapshot of the date this proposal was submitted.
Process wise, we are still there but like I said, you are motivated about this so I am joining the …
Process wise, we are still there but like I said, you are motivated about this so I am joining the conversation, may be I am missing something here. Last time when we try to involve foundation with joining multi-sig with different project they said no because of bureaucracy, So I would start with getting their permission here. Are they willing to take this responsibility. If you are able to resolve this, then I would agree that we have made some progress. jackanorak: Foundation multisig is probably the most low-friction way to custody this while final governance is sorted out. This proposal will impact all upcoming proposals, So I would assume this going to voting on snapshot and for that reason, If I were you, I would do some math here and extend the analogy. We know how many token are left in GF fund, you are proposing 25 % from from our side and 25 % from project side. Run some number and show us the data with, even if it has 10 % of variance. As an impediment to passing this proposal, no. The analogy I used above is that it’s silly to refuse to accept $ 100 of free money because you’re worried you might lose $ 10 of that. We have gone through this many time and I dont agree with this logic. So, i wont repeat again. The primary reason for doing this in the first place is to take OP you were already going to give away and put it to work for the same purpose it was originally being requested for–but also put it to work for you. How efficiently it works for you is secondary because your alternative is getting 0 value for yourself. Few other thoughts:- What about those project that does not have token or cant afford to give 25 % of their share ? Buying OP and putting into foundation treasury would be a good idea where both house would vote to distribute it to public good. I would remove DAO all together if foundation is accepting to hold the address, or mention specifically that decision(on other project DAO) will be done by OP Token house, foundation role would be just cast those votes. Goal here is to keep Foundation as neutral as possible. We are asking projects to give co-incentives, are you planning to keep that part or remove it ? Also put 5 dex of your choice where you want to keep the LP. Would you suggest putting all in a single dex or distribute it between 3 - 5 ? Dex selection should also need voting, I think ? In order for anyone to call Velodrome bias because you are drafting this proposal, I would suggest taking a voting snapshot of the date this proposal was submitted.
Appreciate your thoughts here @norswap. A few things you’re mentioning I’d like to add on to.
Dele…
Appreciate your thoughts here @norswap. A few things you’re mentioning I’d like to add on to.
Delegating donated LP funds to protocols is a fascinating idea I don’t want to lose. Been struggling to propose an actionable approach to getting distributed OP delegated to these major stakeholders, and this feels like it could be a win-win in that it also incentivizers partners to participate. Would hope to see mutual governance influence in the long term, and the discussion on Perp’s distro stands to disenfranchise a major group
Agree on the idea of letting projects decide their own dex – had had this thought. Removes a ton of overhead.
I want to make clear: my guess is that we would benefit primarily through TVL, through the ecosystem’s sustained growth, and through sustained OP token value (which would allow more OP incentivization over time). I’ll say again that, economically speaking, this has an unclear effect on us because partner protocols see a lower cost of liquidity and thus may end up bribing less. For a non-bribe-oriented dex such as Uniswap, my guess is that this would be a strict improvement.
Overall, I think we need to remember that we are doing these grants as a collective. We’re granting a ton of rewards because we believe they will generate more economic activity throughout the ecosystem.
My call to everyone here is to try more positive-sum thinking when considering these grants and asking “how does everyone win” vs “does that protocol get more than me”. In my view, this proposal stands to positively directly affect all stakeholders and increase the Collective’s capacity to continue to do so.
Appreciate your thoughts here @norswap. A few things you’re mentioning I’d like to add on to. Dele…
Appreciate your thoughts here @norswap. A few things you’re mentioning I’d like to add on to. Delegating donated LP funds to protocols is a fascinating idea I don’t want to lose. Been struggling to propose an actionable approach to getting distributed OP delegated to these major stakeholders, and this feels like it could be a win-win in that it also incentivizers partners to participate. Would hope to see mutual governance influence in the long term, and the discussion on Perp’s distro stands to disenfranchise a major group Agree on the idea of letting projects decide their own dex – had had this thought. Removes a ton of overhead. I want to make clear: my guess is that we would benefit primarily through TVL, through the ecosystem’s sustained growth, and through sustained OP token value (which would allow more OP incentivization over time). I’ll say again that, economically speaking, this has an unclear effect on us because partner protocols see a lower cost of liquidity and thus may end up bribing less. For a non-bribe-oriented dex such as Uniswap, my guess is that this would be a strict improvement. Overall, I think we need to remember that we are doing these grants as a collective. We’re granting a ton of rewards because we believe they will generate more economic activity throughout the ecosystem. My call to everyone here is to try more positive-sum thinking when considering these grants and asking “how does everyone win” vs “does that protocol get more than me”. In my view, this proposal stands to positively directly affect all stakeholders and increase the Collective’s capacity to continue to do so.
I would break my takes into two parts: high level (concepts) and implementation level (approach to …
I would break my takes into two parts: high level (concepts) and implementation level (approach to execute/distribute properly)
On a high level
jackanorak:
Simply offering OP to be market dumped for these purposes in this way is an attempt to outrun the token’s degradation, hoping that eventually enough economic value will be generated by the community before the glamour surrounding the OP token’s potential fades to oblivion.
People have hypothesized that it could come from blockspace demand. It could be MEV, transaction ordering, or even community-level partnerships. But there is currently limited tangible value accruing to the Collective, and as far as we can tell there haven’t been significant moves on this issue – and the need to address it is likely imminent.
I mostly agree with this statement. Liquidity is one of many key metrics and plays a vital role in adoption whether we want to accept this or not.
Regarding governance fund phase 1 , I think it would help protocols on OP to bootstrap users together with liquidity over to OP. However, I have observed that many protocols difficult to match incentives with OP tokens. My take on this is most protocols foresee that the OP token value will be dumped for a while given economic value is limited and still underrealized by the market norms. If the market value of OP dropped, it will lead to difficulty for protocols to inorganically bootstrap new users/liquidity from granted OP.
After I read this proposal, I took EVM (Polygon, BSC) and non-EVM (Osmosis) as references, and it proved that the chain representative tokens are mainly used as the main pair (or second to stablecoin(s)).
Referring back to Optimism, based on what I can find, there are only WETH and VELO that are highly paired with OP. The rest are heavily paired with USDC.
On an implementation level
I would not comment on this since I still could not think of ways to execute the liquidity pairing properly. (not saying your proposal is wrong, maybe just me that is unable to imagine it)
jackanorak: I agree in principle with much of what you’re saying, and indeed I’m starting to see that, following this initial proposal (not sure whether baader-meinhof phenomenon), there has been a surge in delegates’ interest in pairing tokens with OP.
If there is broad agreement that this is something generally worth pursuing, one way or another we need to make sure it’s done as part of a deliberate campaign. The worst thing would be to push scattershot rewards, fragmenting the centrality of liquidity between, e.g., WETH and OP, which could hurt the systemic efficiency of swap liquidity.
Let this be the first proposal to put forth such a dedicated effort; we can use it to discuss how best to achieve this (and perhaps jog your thinking on how we could do so).
I agree with the proposal, in general.
There needs to be a separate fund for “Layer-Owned-Liquidity…
I agree with the proposal, in general.
There needs to be a separate fund for “Layer-Owned-Liquidity” aka LOL.
I agree that projects should have voting power in Optimism Collective, but for sure the voting power of projects should not exceed or equal the voting power of the community.
Of course the main goal is to maintain the value of the OP so that public goods have more value.
Context: don’t mix DEXs incentives and Public Goods. This need in stimulus is the result of similar projects with low liquidity. We need more exceptional ideas.
Public Goods is something special, which I hope will focus on research, innovation, education…
And I don’t agree with “metagovernance” = “metamonopoly”.
I would break my takes into two parts: high level (concepts) and implementation level (approach to …
I would break my takes into two parts: high level (concepts) and implementation level (approach to execute/distribute properly) On a high level jackanorak: Simply offering OP to be market dumped for these purposes in this way is an attempt to outrun the token’s degradation, hoping that eventually enough economic value will be generated by the community before the glamour surrounding the OP token’s potential fades to oblivion. People have hypothesized that it could come from blockspace demand. It could be MEV, transaction ordering, or even community-level partnerships. But there is currently limited tangible value accruing to the Collective, and as far as we can tell there haven’t been significant moves on this issue – and the need to address it is likely imminent. I mostly agree with this statement. Liquidity is one of many key metrics and plays a vital role in adoption whether we want to accept this or not. Regarding governance fund phase 1 , I think it would help protocols on OP to bootstrap users together with liquidity over to OP. However, I have observed that many protocols difficult to match incentives with OP tokens. My take on this is most protocols foresee that the OP token value will be dumped for a while given economic value is limited and still underrealized by the market norms. If the market value of OP dropped, it will lead to difficulty for protocols to inorganically bootstrap new users/liquidity from granted OP. After I read this proposal, I took EVM (Polygon, BSC) and non-EVM (Osmosis) as references, and it proved that the chain representative tokens are mainly used as the main pair (or second to stablecoin(s)). Referring back to Optimism, based on what I can find, there are only WETH and VELO that are highly paired with OP. The rest are heavily paired with USDC. On an implementation level I would not comment on this since I still could not think of ways to execute the liquidity pairing properly. (not saying your proposal is wrong, maybe just me that is unable to imagine it)
jackanorak: I agree in principle with much of what you’re saying, and indeed I’m starting to see that, following this initial proposal (not sure whether baader-meinhof phenomenon), there has been a surge in delegates’ interest in pairing tokens with OP.
If there is broad agreement that this is something generally worth pursuing, one way or another we need to make sure it’s done as part of a deliberate campaign. The worst thing would be to push scattershot rewards, fragmenting the centrality of liquidity between, e.g., WETH and OP, which could hurt the systemic efficiency of swap liquidity.
Let this be the first proposal to put forth such a dedicated effort; we can use it to discuss how best to achieve this (and perhaps jog your thinking on how we could do so).
I agree with the proposal, in general. There needs to be a separate fund for “Layer-Owned-Liquidity…
I agree with the proposal, in general. There needs to be a separate fund for “Layer-Owned-Liquidity” aka LOL. I agree that projects should have voting power in Optimism Collective, but for sure the voting power of projects should not exceed or equal the voting power of the community. Of course the main goal is to maintain the value of the OP so that public goods have more value. Context: don’t mix DEXs incentives and Public Goods. This need in stimulus is the result of similar projects with low liquidity. We need more exceptional ideas. Public Goods is something special, which I hope will focus on research, innovation, education… And I don’t agree with “metagovernance” = “metamonopoly”.
@diligit - thanks for critically engaging with the ideas behind this proposal.
I agree that projec…
@diligit - thanks for critically engaging with the ideas behind this proposal.
I agree that projects should have voting power in Optimism Collective, but for sure the voting power of projects should not exceed or equal the voting power of the community.
I absolutely agree with this sentiment. Part of what I found appealing about Norswap’s suggestion was that it seemed like a pretty tractable way to both grant and set boundaries around protocols’ governance power. But we’re still in early stages of discussing implementation (assuming there’s appetite for the broader strokes of this proposal), and I’d love for you to stay involved on this front.
Context: don’t mix DEXs incentives and Public Goods. This need in stimulus is the result of similar projects with low liquidity. We need more exceptional ideas.
I couldn’t agree more with this belief. Liquidity provision is foundational to DeFi health at this current stage of development, but it’s also primarily an intermediate means to an end. Most dapps, DeFi or otherwise, don’t even really need tokens!
The observation that a disproportionate amount of rewards went to liquidity provision (again, important at this current stage) was part of the motivation behind wanting to at least in part separate this service from others, so that projects could be encouraged to think more expansively about how best to use the Optimism Collective’s capacity. It doesn’t need to all be going to LPs (which imo is is a pretty convenient way to funnel grants and vote power to project teams, as we may have already seen in some cases).
Public Goods is something special, which I hope will focus on research, innovation, education…
And I don’t agree with “metagovernance” = “metamonopoly”.
Could you please expand on this? Would like to have a discussion around your concerns. We could do this in the forums in case we have to do a back and forth.
diligit: That’s good, now I understand how metagovernance will be achieved and how the Optimism Collective will be involved in it. There is too much extra information in the proposal, it would be better if it was structured in “Why” and “For” in details, but yes, I support the proposal.
And I can answer your questions:
jackanorak:
How would this be incentivized or required?
From Ecosystem Fund, through GF
jackanorak:
Would there be some ‘bonus’ OP pool set aside?
Yes
jackanorak:
How much OP currently requested for liquidity as a proportion of the total OP distributed should be targeted?
max. 5%
jackanorak:
Would OP compound LP positions or accrue vote power (in the case of, e.g., positions on Velodrome and Curve)?
50/50
jackanorak:
Can we call this layer-owned liquidity (LOL)?
Yes
jackanorak:
What would be the actual mechanics of managing the LPs? Who administers them?
The Optimism Foundation
I agree in principle with much of what you’re saying, and indeed I’m starting to see that, followin…
I agree in principle with much of what you’re saying, and indeed I’m starting to see that, following this initial proposal (not sure whether baader-meinhof phenomenon), there has been a surge in delegates’ interest in pairing tokens with OP.
If there is broad agreement that this is something generally worth pursuing, one way or another we need to make sure it’s done as part of a deliberate campaign. The worst thing would be to push scattershot rewards, fragmenting the centrality of liquidity between, e.g., WETH and OP, which could hurt the systemic efficiency of swap liquidity.
Let this be the first proposal to put forth such a dedicated effort; we can use it to discuss how best to achieve this (and perhaps jog your thinking on how we could do so).
@diligit - thanks for critically engaging with the ideas behind this proposal. I agree that projec…
@diligit - thanks for critically engaging with the ideas behind this proposal. I agree that projects should have voting power in Optimism Collective, but for sure the voting power of projects should not exceed or equal the voting power of the community. I absolutely agree with this sentiment. Part of what I found appealing about Norswap’s suggestion was that it seemed like a pretty tractable way to both grant and set boundaries around protocols’ governance power. But we’re still in early stages of discussing implementation (assuming there’s appetite for the broader strokes of this proposal), and I’d love for you to stay involved on this front. Context: don’t mix DEXs incentives and Public Goods. This need in stimulus is the result of similar projects with low liquidity. We need more exceptional ideas. I couldn’t agree more with this belief. Liquidity provision is foundational to DeFi health at this current stage of development, but it’s also primarily an intermediate means to an end. Most dapps, DeFi or otherwise, don’t even really need tokens! The observation that a disproportionate amount of rewards went to liquidity provision (again, important at this current stage) was part of the motivation behind wanting to at least in part separate this service from others, so that projects could be encouraged to think more expansively about how best to use the Optimism Collective’s capacity. It doesn’t need to all be going to LPs (which imo is is a pretty convenient way to funnel grants and vote power to project teams, as we may have already seen in some cases). Public Goods is something special, which I hope will focus on research, innovation, education… And I don’t agree with “metagovernance” = “metamonopoly”. Could you please expand on this? Would like to have a discussion around your concerns. We could do this in the forums in case we have to do a back and forth.
diligit: That’s good, now I understand how metagovernance will be achieved and how the Optimism Collective will be involved in it. There is too much extra information in the proposal, it would be better if it was structured in “Why” and “For” in details, but yes, I support the proposal.
And I can answer your questions:
jackanorak:
How would this be incentivized or required?
From Ecosystem Fund, through GF
jackanorak:
Would there be some ‘bonus’ OP pool set aside?
Yes
jackanorak:
How much OP currently requested for liquidity as a proportion of the total OP distributed should be targeted?
max. 5%
jackanorak:
Would OP compound LP positions or accrue vote power (in the case of, e.g., positions on Velodrome and Curve)?
50/50
jackanorak:
Can we call this layer-owned liquidity (LOL)?
Yes
jackanorak:
What would be the actual mechanics of managing the LPs? Who administers them?
The Optimism Foundation
I agree in principle with much of what you’re saying, and indeed I’m starting to see that, followin…
I agree in principle with much of what you’re saying, and indeed I’m starting to see that, following this initial proposal (not sure whether baader-meinhof phenomenon), there has been a surge in delegates’ interest in pairing tokens with OP. If there is broad agreement that this is something generally worth pursuing, one way or another we need to make sure it’s done as part of a deliberate campaign. The worst thing would be to push scattershot rewards, fragmenting the centrality of liquidity between, e.g., WETH and OP, which could hurt the systemic efficiency of swap liquidity. Let this be the first proposal to put forth such a dedicated effort; we can use it to discuss how best to achieve this (and perhaps jog your thinking on how we could do so).
That’s good, now I understand how metagovernance will be achieved and how the Optimism Collective w…
That’s good, now I understand how metagovernance will be achieved and how the Optimism Collective will be involved in it. There is too much extra information in the proposal, it would be better if it was structured in “Why” and “For” in details, but yes, I support the proposal.
And I can answer your questions:
jackanorak:
How would this be incentivized or required?
From Ecosystem Fund, through GF
jackanorak:
Would there be some ‘bonus’ OP pool set aside?
Yes
jackanorak:
How much OP currently requested for liquidity as a proportion of the total OP distributed should be targeted?
max. 5 %
jackanorak:
Would OP compound LP positions or accrue vote power (in the case of, e.g., positions on Velodrome and Curve)?
50 / 50
jackanorak:
Can we call this layer-owned liquidity (LOL)?
Yes
jackanorak:
What would be the actual mechanics of managing the LPs? Who administers them?
The Optimism Foundation
That’s good, now I understand how metagovernance will be achieved and how the Optimism Collective w…
That’s good, now I understand how metagovernance will be achieved and how the Optimism Collective will be involved in it. There is too much extra information in the proposal, it would be better if it was structured in “Why” and “For” in details, but yes, I support the proposal. And I can answer your questions: jackanorak: How would this be incentivized or required? From Ecosystem Fund, through GF jackanorak: Would there be some ‘bonus’ OP pool set aside? Yes jackanorak: How much OP currently requested for liquidity as a proportion of the total OP distributed should be targeted? max. 5 % jackanorak: Would OP compound LP positions or accrue vote power (in the case of, e.g., positions on Velodrome and Curve)? 50 / 50 jackanorak: Can we call this layer-owned liquidity (LOL)? Yes jackanorak: What would be the actual mechanics of managing the LPs? Who administers them? The Optimism Foundation
Would like to take the opportunity to restart the conversation here. I’m not really sure where else…
Would like to take the opportunity to restart the conversation here. I’m not really sure where else we ought to go from here, as this proposal has now had some form of approval from a wide swath of the community, including OP Labs members (in a private capacity) as well as delegates.
But there’s clearly more to hash out here. Perhaps in a way to make this actionable and take advantage in the pause in rewards, could we perhaps start a working group to hash out the details here to submit for a proposal?
Separately, would like to mention that there is some outside support for measures such as this to lend immediate utility to OP. Here’s Crocswap’s founder, Doug Colkitt, remarking on the core problem:
twitter.com
2
@
Bear case for Optimism flipping Solana, is so far the default unit of account on the chain is ETH not OP.
Until there’s real value accrual in fees/MEV, the intermediate demand for SOL is that you need it to participate in Solana DeFi and NFTs. What will drive demand for OP?
This proposal offers a solution to the issue he’s posing.
would like to mention this to anyone not reading the complete thread that this proposal does not ha…
would like to mention this to anyone not reading the complete thread that this proposal does not have approval from OP Labs and wording seems misleading, at least to me.
As per bobby, this is valid proposal, he is not endorsing the content or providing his approval.
[DRAFT] [GF: META] Proposal to reserve a share of GF distribution for liquidity backstopping and stronger governance ?Other Proposals
The Velodrome team did share this proposal with members of the Optimism team before posting on this forum. This is not an endorsement or “pre-check” of the proposal contents, but their statement is true.
Sharing my own opinion as an individual: I think this is a valid Phase 1 proposal because it’s still describing a potential token allocation from the GovFund — but instead of distributing those tokens to a project, they’re held for liquidity pairing.
What norswap has said is his personal opinion as mentioned in his comment and not of OP Lab team.
I said that OP Labs members agreed with this in a private capacity, i.e., not as team members. This…
I said that OP Labs members agreed with this in a private capacity, i.e., not as team members. This is clearly true and not intended to be misleading; this may be lost in translation. Would appreciate a retraction.
I’ll also echo @OPUser that OP Labs team members said in an official capacity that this proposal was suitable to present in the forum, i.e., that it is in fact a valid proposal.
Would like to take the opportunity to restart the conversation here. I’m not really sure where else…
Would like to take the opportunity to restart the conversation here. I’m not really sure where else we ought to go from here, as this proposal has now had some form of approval from a wide swath of the community, including OP Labs members (in a private capacity) as well as delegates. But there’s clearly more to hash out here. Perhaps in a way to make this actionable and take advantage in the pause in rewards, could we perhaps start a working group to hash out the details here to submit for a proposal? Separately, would like to mention that there is some outside support for measures such as this to lend immediate utility to OP. Here’s Crocswap’s founder, Doug Colkitt, remarking on the core problem: twitter.com 2 @ Bear case for Optimism flipping Solana, is so far the default unit of account on the chain is ETH not OP. Until there’s real value accrual in fees/MEV, the intermediate demand for SOL is that you need it to participate in Solana DeFi and NFTs. What will drive demand for OP? This proposal offers a solution to the issue he’s posing.
would like to mention this to anyone not reading the complete thread that this proposal does not ha…
would like to mention this to anyone not reading the complete thread that this proposal does not have approval from OP Labs and wording seems misleading, at least to me. As per bobby, this is valid proposal, he is not endorsing the content or providing his approval. [DRAFT] [GF: META] Proposal to reserve a share of GF distribution for liquidity backstopping and stronger governance ?Other Proposals The Velodrome team did share this proposal with members of the Optimism team before posting on this forum. This is not an endorsement or “pre-check” of the proposal contents, but their statement is true. Sharing my own opinion as an individual: I think this is a valid Phase 1 proposal because it’s still describing a potential token allocation from the GovFund — but instead of distributing those tokens to a project, they’re held for liquidity pairing. What norswap has said is his personal opinion as mentioned in his comment and not of OP Lab team.
I said that OP Labs members agreed with this in a private capacity, i.e., not as team members. This…
I said that OP Labs members agreed with this in a private capacity, i.e., not as team members. This is clearly true and not intended to be misleading; this may be lost in translation. Would appreciate a retraction. I’ll also echo @OPUser that OP Labs team members said in an official capacity that this proposal was suitable to present in the forum, i.e., that it is in fact a valid proposal.
Monthly bump to restart the conversation - some people in the Velodrome discord had been theorizing…
Monthly bump to restart the conversation - some people in the Velodrome discord had been theorizing on this very point and I was hoping some thoughtful people would weigh in.
Monthly bump to restart the conversation - some people in the Velodrome discord had been theorizing…
Monthly bump to restart the conversation - some people in the Velodrome discord had been theorizing on this very point and I was hoping some thoughtful people would weigh in.
Monthly bump for some engagement here in the wake of a massive drop in OP’s price
think we’ve now g…
Monthly bump for some engagement here in the wake of a massive drop in OP’s price
think we’ve now gotten to a place where people are asking about how to ‘use’ OP.
the answer of course is for governance. so let’s make sure that this governance value is worth enough to fund the projects we all want
Monthly bump for some engagement here in the wake of a massive drop in OP’s price think we’ve now g…
Monthly bump for some engagement here in the wake of a massive drop in OP’s price think we’ve now gotten to a place where people are asking about how to ‘use’ OP. the answer of course is for governance. so let’s make sure that this governance value is worth enough to fund the projects we all want
After a helpful round of feedback, it may be prudent to roll back one piece of the metagovernance p…
After a helpful round of feedback, it may be prudent to roll back one piece of the metagovernance part of this proposal, where the LP positions – though representing yield-bearing stakes in ecosystem DAOs – will not have voting power in the constituent protocols. This would make prospective grantees more likely to participate and eliminate unnecessary decision-making.
The really important part of this piece as it relates to the Collective’s stake is that it is 1 ) a direct representation of the ecosystem’s stake in aggregate economic activity and 2 ) tangible, accretive value that can flow to governance and continually refresh the Collective’s capacity to fund growth initiatives, public goods, and so on.
I remain eager to entertain thoughts on this, especially in light of governance funds’ outcomes to date as shown by yesterday’s conference call.
After a helpful round of feedback, it may be prudent to roll back one piece of the metagovernance p…
After a helpful round of feedback, it may be prudent to roll back one piece of the metagovernance part of this proposal, where the LP positions – though representing yield-bearing stakes in ecosystem DAOs – will not have voting power in the constituent protocols. This would make prospective grantees more likely to participate and eliminate unnecessary decision-making. The really important part of this piece as it relates to the Collective’s stake is that it is 1 ) a direct representation of the ecosystem’s stake in aggregate economic activity and 2 ) tangible, accretive value that can flow to governance and continually refresh the Collective’s capacity to fund growth initiatives, public goods, and so on. I remain eager to entertain thoughts on this, especially in light of governance funds’ outcomes to date as shown by yesterday’s conference call.
If Optimism wants META superiority , this is one of those proposals that the whole should look into…
If Optimism wants META superiority , this is one of those proposals that the whole should look into! Much love OPTI! :red_circle:
I am big fan of OP & VELO ! I hope the two would be discussing something exciting and juicy in the …
I am big fan of OP & VELO ! I hope the two would be discussing something exciting and juicy in the future! Lfg! :red_circle::rocket:
If Optimism wants META superiority , this is one of those proposals that the whole should look into…
If Optimism wants META superiority , this is one of those proposals that the whole should look into! Much love OPTI! :red_circle:
I am big fan of OP & VELO ! I hope the two would be discussing something exciting and juicy in the …
I am big fan of OP & VELO ! I hope the two would be discussing something exciting and juicy in the future! Lfg! :red_circle::rocket:
