Balancer Public Goods Pool

[chadfi]

Summary

Create a Public Goods Pool on Balancer with (up to 8) consonant DAOs:

· Giveth (GIV)

· Balancer (BAL)

· Radicle (RAD)

· BrightID (BRIGHT)

· DappNode (NODE)

· 1Hive (HNY)

· ShapeShift (FOX)

· Optimism (OP)

· Ethereum Naming Service (ENS)

· Gnosis (GNO)

· Aragon (ANT)

· Opolis (WORK)

· Bankless (BANK)

· Others? (please leave a comment)

Proposal Description

Several public good DAOs have expressed interest in participating in a shared liquidity pool on Balancer. Details of pool weights and participants are fluid, but with support of this proposal, Giveth will begin reaching out to potential partners to solidify this idea.

Background

Founder of Block.Science & cadcad.org, mZ (@mZargham) proposed the idea for an ESG (Environmental, Social, & Governance) Balancer Pool shortly after the launch of the GIVeconomy. In fact, this idea may have been incubating since as far back as 2018:

Proposal Rationale

DAO-2-DAO token swaps are an excellent way to align like-minded DAOs while simultaneously generating sustainable liquidity. While 1-to-1 token swaps are a powerful tool, Balancers extension of the x*y=k model allows for up to 8 tokens in a single pool.

As Kirill Naumov notes in his article Back to the Basics, Balancer “can also be thought of as an index protocol, where the token weightings are set to specific percentages of a pool and arbitrageurs ensure that weighting is maintained”. Many of the leading Gnosis DAOs participated in the successful deployment of the novel index token, $WATER. This proposed Public Good Pool will be an extension of that idea, fostering alignment of those DAOs focused on fostering public good growth on the blockchain.

Additional Information: Potential Participants

Partnerships through $WATER include:

Opolis may be in a state of high inflation, @chadfi to investigate and include analysis in the comments.

In order to foster new partnerships, preference is to primarily pursue DAOs not involved in $WATER (see below). Those participants will be pursued secondarily.

· Balancer (BAL)

· Radicle (RAD)

· DappNode (NODE)

· Optimism (OP)

· Ethereum Naming Service (ENS)

· Aragon (ANT)

· Bankless (BANK)

· Gnosis (GNO)*

*GnosisDAO has an existing pool with Giveth and should be considered as an existing partner, and pursued secondarily.

@chadfi to investigate Mainnet liquidity and include analysis in the comments (where those with high Mainnet liquidity are preferred partners).

Next Steps

With consensus, the Research team will begin engaging the DAOs listed above (and in the comments) to gauge their interest in participation (including desired position size). Mainnet is preferable but Gnosis Chain may be considered.
One additional partner that could potentially be involved outside of the actual liquidity position is DoinGud. Their participation could perhaps be in the form of an NFT airdrop to each DAO, or to outside participants providing liquidity.

Team Contacts

@chadfi
@Simone
@cotabe

Pursue Partnerships for Balancer Public Good Pool?

• Let’s do it!
• Not feeling it

[Cotabe]

I love this idea.

I don’t consider myself an expert on GIVeconomy research topics YET… But from what I’ve been learning two great benefits of this proposal would be:

1. More liquidity (without paying for it, which aligns with the intention to turn off most farms to keep GIVpower and Angel Vault)

2. Keep all DAOs incentivized for the long-term success of the others. Fostering collaboration.

[WhyldWanderer]

@chadfi

Many of the leading Gnosis DAOs participated in the successful deployment of the novel index token, $WATER. This proposed Public Good Pool will be an extension of that idea, fostering alignment of those DAOs focused on fostering public good growth on the blockchain.

I’m curious to know more about how the launch of the $WATER token went? I haven’t heard much news after it was launched. I had the understanding that the participating DAOs we unimpressed by the outcome of that initiative.

Like Cotabe, I don’t know a whole lot on the tokenomics side of things. I want to ensure that we are making informed decisions and learning from our past experiences to do better in future collaborations. Also, I’m just genuinely interested in what the outcome of the $WATER token launch was and what we have learned.

[Cotabe]

I’m super interested in knowing how $WATER is going. It would be great to have a debrief about that in a community call or in another time slot

[chadfi]

Thanks for the feedback @WhyldWanderer and @Cotabe. At present, volume for $WATER trading is near zero. It’s price has dipped ~60% since launch. Paul, from 1Hive, marked two distinct follow on steps for post launch:

• Marketing for Water token. Private buyers of the Water token (who swap for Water with a token that isn’t paired with Water) get an index token with extra upside. We want to get the word out about this since people buying Water creates upward price pressure for all paired tokens.
• Long term governance. Start work on building a more secure, decentralized, and community-oriented governance system for Water.

It’s pretty clear from the volume that private buyers are not very interested in $WATER. This disinterest could certainly be mitigated with proper marketing from all interested parties, but I don’t believe strong efforts have been made in that department.

I’m not in tune with the governance system, but I will reach out to Paul and see what has been ideated/built.

This Balancer pool will be unique from $WATER in that:

1. It’s mainnet liquidity
2. It’s far less complex than an index token - a simple weighted pool is easy to interact with which should help maintain volume
3. It’s Balancer, which has far more active users than 1Hive, which again, should help to maintain volume

[mitch]

Great points @chadfi !

I think the balancer pool has a lot of advantages and covers some key points for the GIVeconomy.

• BIG mainnet liquidity/token collaterlization for basically free, no need pay out rewards or sell GIV
• No need for governance structure
• No index token to monitor or manage
• Perpetually accrued swap fees will have deflationary effects over time.
• Cementing beautiful partnerships

My only concern is that we check how inflationary some of the tokens we wish to partner with, what are their token emissions? What’s the utility of their token? Are most people only going to sell the DAO tokens of the orgs we choose to partner with? Many of these factors will have negative impacts on our token if we don’t do some extra homework.

[Lanski]

100% agree with @mitch
In principle it’s a good idea in terms of aligning incentives between Public Good DAOs, I fully support that.
But different tokens will have different inflation rates, which over time might cause imbalances and the fact that other tokens will see their efforts diluted. I’d like to see an analysis or a projection of the roadmaps… maybe we could do a committee that reviews applications from each token so the load on explaining the roadmaps and tokenomics of every ecosystem falls into the hands of the ones who are interested in participating with their own token?