👨🔬 Governance Lab #046
Lab Report #046 - Uniswap Governance Upgrade, Lido DAO Revenue Share, dYdX Short-Term Boost Program, and more
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Welcome back to the Governance Lab, your weekly source for all things StableLab, DeFi, and DAO Governance. CEX outages, ATH, and ETH Denver. Bit quieter on the governance front this week with a lot of the industry meeting IRL at the conference. A few interesting proposals and a landmark proposal at Uniswap that has the space talking. As always enjoy. :)
If you’re at ETH Denver, our team is on the ground and eager to meet you. DM us!
At a Glance 👀
🦄 Uniswap DAO discusses introducing fee mechanism rewards
❌ Lido DAO receives yet another revenue share proposal
⏭️ dYdX Short-Term Boost Program
Dive in 🏊
Rewards
Uniswap DAO discusses Governance Upgrade
Last Friday, Erin Koen, Governance Lead at the Uniswap Foundation submitted a landmark governance proposal. In the proposal, the UF proposes upgrading the Uniswap protocol with the introduction of a fee mechanism that rewards UNI tokenholders who delegate or stake their tokens. This upgrade aims to strengthen Uniwap’s governance system by incentivizing “active, engaged, and thoughtful delegation.” To power the upgrade, two new smart contracts are introduced: V3FactoryOwner.sol and UniStaker.sol. The first contract enables the programmatic and permissionless collection of protocol fees from pools, while the second serves to manage delegation and fee distribution.
A fee switch has long been a topic of debate at the Uniswap DAO. Since its posting on Friday, the discussion has sparked interest across the industry as different stakeholders weigh in. Uniswap LPs have expressed concerns about how the mechanism may reduce their returns. Some existing Uniswap delegates suggested that delegation won’t actually flow to active delegates. The proposal will move to a Snapshot vote on March 1st, with an on-chain vote scheduled for March 8th should the initial vote be successful.
Revenue Sharing
Lido DAO receives (yet) another revenue share proposal
On Monday, a user named 'Lidosaviour' put forward a proposal on the Lido DAO forums to introduce a staking module and buyback program. The proposal aims to allocate 20-50% of DAO revenue from the treasury to LDO stakers.
The notion of implementing a staking reward for LDO tokenholders continues to be brought up periodically. Two key members of the Lido community shared their thoughts on the latest proposal. First, Hasu expressed concerns about implementing revenue sharing at the current protocol stage. Second, Steakhouse echoed similar sentiments, suggesting that such an initiative might eventually make sense in the future. This type of proposal is gaining popularity in various ecosystems as the demand for protocol revenue sharing grows.
❲ Links ❳
🚀 Launches & Deployments
📑 Insights & Reports
Communication Breakdown: Governance is a Theater
Protocol Fee Sharing and the Future of Uniswap
Thread: Uniswap’s Fee Switch
The Future of the Stablecoin Design
Decentralized stablecoins. Why does DeFi need them?
Wintermute DeFi Governance Digest: February 2023 | Week 4
🧗 Milestones & Updates
dYdX Launch Incentives Season 3
dYdX Chain Quarter Highlights
Update on the Arbitrum Treasury Endowment Program
🔒 Security, Risk, & Hacks
Gauntlet joins Morpho Blue
MakerDAO Risk Month in Review: February 2024
🗞️ Miscellaneous
Paladin: Dydymoon Retroactive Grant Request
Aave: Increase GHO Borrow Rate
Lido: Activate Lido Protocol Governance with Revenue Share Staking
Aevo: TGE Update 1.5
GMX plans to launch own chain
Frax Finance considers turning on fee switch
UNI Soars 60% on Fee Switch Proposal
Optimism Impact Metric-based Voting
📺 Podcasts & Listens
Samantha Marin (Aragon): Future-Proof Governance: Building Modular Organizations of the Future at ETH Denver
❲ Proposal Tracker ❳
✅ COMPLETED | Aave - Stable Rate Deprecation
Summary: This proposal seeks to disable stable rate mode on Aave v2 and v3. Due to a critical bug found related to this feature, the proposal moves all users with stable debt positions to variable and does not allow any new positions created to use the stable rate. The white hat who reported the bug is eligible to receive a $1M bug bounty through Immunefi.
💬 DISCUSSION | Aave - Aave Support Collective
Summary: This proposal aims to establish the Aave Support Collective, a dedicated team overseeing Aave protocol support channels and operations. The initial ASC team will include two existing Aave support team members, essah and h3lpfulbro. The proposal outlines a budget request of $200k USD for a 12-month period.
💬 DISCUSSION | Euler - eIP 58: EUL Liquidity
Summary: This proposal aims to take EUL and ETH from the DAO treasury to provide liquidity on Uniswap V3. The goal of this proposal is to enhance the available liquidity of EUL to attract more stakeholders and support the growth of the protocol. Two options are presented: $500K at full range or $500K at 90% down and 1000% up.
From the Lab
dYdX Short-Term Boost Program (STBP)
We’ve submitted a proposal at dYdX to take a different approach to grant program management, putting the community in the driver's seat and equipping it with the information they need to make decisions. The Short-Term Boost Program is a 6-month initiative focused on three funding tracks: Community & Growth, Traders & Tooling, and Governance & Security Research.
Read the full proposal here.
Team Offsite: KL 2024 Montage
Last month, the StableLab team traveled to Kuala Lumpur, Malaysia for a team offsite. Enjoy this short montage showcasing the amazing week we spent together. 🩶🌴
Stake with us at UX Chain!
Stake with us at UX Chain. 💪 Our team has launched a node validator to support the security and expansion of UX Chain, a Cosmos-based cross-chain borrowing and lending blockchain.
View our Node Validator here.
❲ Our Voting ❳
📆 February 23rd → February 29th | 🗳️ Total Votes: 24
See our full vote history and detailed rationale HERE.
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