The Treasury Working Group (TWG) was established at the end of November 2021 via PTIP-46. Over the last several months, members of the TWG have worked to provide analysis on various governance issues.
Per our original proposal, the TWG’s core purpose is to:
- Ensure safety and prudence go into every decision
- Drive future protocol growth
- Identify sustainable solutions
- Present objective data to the community
Below, we’ll review our proposal for the next operational quarter, our first quarter deliverables, and our performance over the last quarter in the Proof of Work section.
In the sections below, posts are noted by TWG member, but many of the contributions made to the forum were done collaboratively; it’s important to note that while one person posts a response, internal discussions and effective coordination went into the lions share of forum posts in our first quarter.
In our second operational quarter, @BraveNewDeFi will be the proposed chair and, if approved, he will take on the TWG Chair role. He would be responsible for coordinating communication, posting feedback/comments on the forum, and maintaining close communication with the PoolTogether Inc. team to ensure both the TWG and the protocol are working toward the same goals.
In our next quarter, the following TWG members will remain as contributors:
- BraveNewDeFi (Llama)
- yuan-han-li (Llama)
The following members have decided not to stay on for the second quarter due to other commitments or time constraints:
- RegisIsland (stepped down after TWG was created due to time constraints)
When the TWG was established through governance, PoolTogether V4’s TVL on Ethereum and Polygon combined was 18,480,753.45 USDC (as of 12/5/21). At the time of writing, the combined V4’s TVL on Ethereum, Polygon, and Avalanche is 35,016,033 USDC. This represents 89.47% growth over three months.
However, we’ll need to grow TVL across networks by ~500% to achieve the current prize distribution in PoolTogether V4. Some rough estimates on cost are included in our commentary on PTIP-56.
The TWG’s focus going into our second operational quarter will revolve around ways we can leverage our treasury to offset existing operational costs, increase on-chain liquidity in the most cost effective way possible, and achieve growth in depositors and interest earned.
In the second operational quarter, the TWG will focus on the following high level deliverables:
- Exploring protocol-owned liquidity solutions (POL): We’ll fast track an evaluation of the Ondo <> Fei LaaS program and provide further analysis on PTIP-61 and PTIP-64. Any liquidity solutions proposed through governance will also be reviewed (e.g., a proposal to deploy liquidity on Polygon).
- Identify new yield sources: While this deliverable is somewhat outside the scope of the TWG, we believe this is one of the most important changes that the protocol can make to reduce the growth required to reach breakeven or profitability. By presenting options to the community, we can begin a discussion around finding yield sources that provide higher returns, while ensuring they adhere to our security guidelines. We’ll coordinate with @brendan on this deliverable to ensure we take development resources into consideration when proposing any yield sources on the forum.
- Prize tiering, simulation: This deliverable will become a core duty of the TWG. Our members have participated in every discussion surrounding prize tiering in the last quarter, and the community supported the outcomes advocated for by the TWG members. Since prize tiering is currently dependent on USDC held within the treasury, it will be important for the TWG to provide analysis for the community to make informed decisions when evaluating changes to prizes.
- Non-stablecoin asset management: In our first quarter, we presented options for stablecoin asset management, but we have several other assets within the treasury that we can allocate to productive strategies, liquidate to increase our stablecoin holdings, and/or stake to earn additional rewards. We’ll explore this further to evaluate ways we can turn more treasury assets into productive assets to further offset operational costs.
- Evaluating TRIBE Turbo: Later this month, Tribe DAO’s TRIBE Turbo program will go live. This program could provide a way for the protocol to use POOL holdings to generate non-operating revenue. Once the full details of the program are announced, the TWG will review and present our findings to the community.
- Leveraging TWAB for Growth: Once the TWAB contract is live, the treasury can use some of the PTaUSDC deposited as sponsorship capital in V4 to delegate the chance to win and potentially drive growth in depositors. We will likely coordinate with members of the MWG if we are able to pursue this deliverable in our second quarter. Identifying ways to drive growth using existing treasury assets will be another core area of focus.
In our first quarter, the TWG requested a budget of 2250 POOL/quarter, with an allocation of 750 POOL per month that was distributed via Coordinape. The TWG also requested 250 POOL for our efforts to establish the working group and provide analysis before the working group was passed through governance.
Over the course of our first quarter, 750 POOL were distributed among active contributors each month.
When our first budget was requested, POOL was ~$9/POOL. The TWG chose to be paid in POOL to align incentives with the DAO. The total quarterly budget was $20,250 USD, or $6,750/month. During our first quarter, the average contributor received $234 in POOL for their monthly contribution due to the change in POOL prices.
For our second operational quarter, the TWG is seeking $30,000 in POOL, which is equivalent to 12,820 POOL/quarter, or 4,273.33 POOL/month. We still believe payment in POOL aligns incentives with the community and drives us to work for the betterment of the protocol. An increased allocation to our budget is intended to reduce the churn of contributors and provide incentives for 6-8 contributors, so we can expand the scope of the TWG’s analysis and core duties.
@underthesea spent a total of 0.1574 ETH in gas costs for submitting on-chain proposals on behalf of the TWG. The relevant transactions are included here and here. We request retroactive compensation for underthesea’s gas costs, as submitting on-chain PTIPs was not initially in the scope of the TWG. When we first formed, we were to provide analysis but have no execution power.
Going forward, the TWG will take on the responsibility for putting votes on-chain in the second operational quarter. There will additional gas costs associated with submitting on-chain proposals, so we are requesting a $2000 budget in USDC that will be used to acquire WETH that is held in the TWG multisig; some of this funding will go to reimbursing underthesea, as well. Any WETH that is not used for executing on-chain proposals will be returned to the treasury or rolled over at the end of the operational quarter.
As we seek renewal for our second operational quarter, we would like to put out a call for any PoolTogether community members who would like to apply to join the TWG. Some members of the TWG will not be continuing for the second quarter, and we welcome new contributors to apply if they would like contribute to the TWG’s mission. We are looking for another 1-2 active contributors to join the TWG. Interested community members can apply by responding in this thread.
Below is a screencap of our first quarter deliverables; these can be found in the PTIP-46 post as well.
In the next section, we’ll present an overview of our work to date.
While we executed on all deliverables with the exception of number three, we also provided analysis on a variety of proposals predating the official launch of the TWG and during our first operational quarter. We’ve broken down our contributions in the sections that follow for the community’s review.
As the TWG was being established, the discussion around the Ondo <> Fei LaaS Program was active. While the community reviewed this proposal, we prioritized analysis of the program to ensure a review of Fei’s peg stability mechanism and protocol were presented alongside a review of Ondo, so members could make an informed decision when the conversation transitioned to a Snapshot vote. The TWG and its members provided analysis in the following posts:
After robust discussion, the TWG transitioned the Ondo <> Fei LaaS program and POOL incentives to a Snapshot vote in PTIP-50: POOL Liquidity Management, which TheRealTuna posted.
Over the month of January, TWG members discussed possible strategies to earn yield on stablecoins held in the protocol treasury as sponsorship capital in PoolTogether V3 (where it was subsidizing prizes for whale depositors), stablecoin treasury holdings, and USDC/DAI reserves. Over the month of January, several governance proposals discussed possible USDC allocation from the treasury, which altered some of our approaches and potential allocation for stablecoin holdings.
At the beginning of February, we presented the Treasury Assets Management #1 post on the forum, where we proposed the allocation of 3.7m USDC into PoolTogether V4 to generate interest for daily prizes and ~500k DAI into Notional Finance, where it would earn yield in the June 26 tenor lending pool.
Allocation and strategy where discussed with the community in the following posts:
After discussion concluded, this proposal was transitioned to PTIP by Bronder–PTIP-54: Treasury Assets Management #1
However, due to the complex nature of managing treasury assets through the governor alpha contract, we were not able to deposit the USDC and/or DAI into Notional Finance.
The community can review a snapshot of the treasury holdings and the stablecoin asset management’s performance as of March 10, 2022 here. There is also a tab with a history of TRIBE rewards and the executive multisig, which holds TRIBE deposited in Fuse Pool #8 and the liquidity in the Ondo <> Fei LaaS program.
Anyone can verify the protocol’s treasury holdings by viewing the treasury in the PoolTogether UI: https://info.pooltogether.com/. The only assets not reflected here are the TRIBE rewards and LaaS liquidity, which is available above.
While we set out to get V4 tickets listed on a reputable lending protocol, there were few options available that proved safe and/or reliable. There is a chance when Aave V3 launches that we’ll be able to pursue a listing for V4 tickets; however, there isn’t a lending platform that we could bootstrap borrow-side liquidity, which will be the biggest hurdle to clear. We did consider Abracadabra, but ultimately, the Wonderland scenario coupled with the momentary MIM depeg made us reconsider that option.
We can consider this deliverable going forward, but the TWG will focus on more pressing issues in the interim until a reputable platform becomes viable for V4 ticket listing.
When the original Olympus Pro LP Proposal was posted on the forum, the then proposed TWG provided analysis of the proposal and ran the numbers on POOL emissions vs. current LM incentives, along with a few other scenarios. The original analysis was posted here:
A follow up comment after subsequent discussion was also included:
This proposed experiment was further discussed in PTIP-40: Olympus LP incentives & POOL pool Distribution and subsequently passed via governance. After the bond sale had been active for a one-month period, the TWG analysed the performance of the Olympus Pro offering.
Our analysis found that the Olympus Pro experiment was not successful for the DAO, and our analysis was discussed at length on Twitter.
The TWG has also provided analysis and commentary on existing Uniswap V2 incentives, POOL pool emissions, and prize adjustments. We’ve also provided analysis and contributed to discussions around protocol-owned liquidity. Below is a catalogue of posts TWG members have contributed to the governance forum in the last several months.
TWG members have provided a wide range of analysis and commentary within the governance forums over the last several months. For the majority of our operational quarter, at least one of the TWG members has been present on the weekly community call. We’ve reached out to PT Inc. several times over the last several months to ensure our priorities were aligned with their goals.
Overall, we believe we delivered value to the community through our analysis since the TWG was proposed and subsequently formed.
In our first operational quarter, the TWG has provided valuable analysis and followed through on our core purpose. We invite community members to apply if they are interested in contributing to the TWG.
Our second operational quarter will officially begin once we receive funding. Until that time, we will work for the community and continue to provide analysis where it is needed.
At this time, we’re opening our proposal up with a request for comments before transitioning to PTIP. We want to ensure the community is aligned with our proposal before we move to PTIP.
- Yes, I support in its current form.
- No, I do not support in its current form (add comments below post, please)