TBR-Q1-2023 - Renewal Finance Team

Team Name Finance Team
Quarter and Year Q1 2023
Payout Address 0xB74659A1011F6DCA3BA6F6e22a71bA8f414F36A1
Total USD Value Requested $6,589.35 USD

Purpose

The Finance team continues with the core purposes from the previous quarter:

  • Ensure safety and prudence go into every decision

  • Drive future protocol growth

  • Identify sustainable solutions

  • Present objective data to the community

Acquiring these values, the Finance team will specially focus on Treasury sustainability and transparency. With the Treasury growth and the creation of multiple independent teams, the Finance team can offer a holistic view of the Treasury to bring clarity on a financial perspective.

Finally, the Finance team will monitor and implement changes to prize distributions with the purpose of growing the protocol in a sustainable manner. Example duties: monitoring prize data and sentiment, adjusting prizes and optimizing prize distributions to create the best user experience.

Previous Quarter Performance

The finance team had 4 clearly defined goals for the Q4 2022:

1. Quarterly review of DAO inflows/outflows

Objective: A quarterly report will be published giving specific and objective information on the inflows/outflows of the DAO.

Given that the TBR renewal needs to be posted before the end of quarter, this document has not been published yet. However, we are committed to do so and post it in the governance forum at the beginning of Q1 2023.

We have published an analysis on Q4 2022 TBRs in order to give better visibility to the DAO regarding inflows and outflows from the Treasury, as well as a holistic view of all proposed teams.

2. Asset Management Analysis

Objective: at least 3 different yield strategies will be presented to the DAO.

We have been reviewing Enzyme Finance and talking to Avantgarde (the company in charge of its development). This protocol allows on-chain asset management and, specifically, is compatible with the Governor contract. Therefore, through Enzyme it’s possible for the Treasury to use yield strategies that would otherwise not be available without having a multisig custodying the funds.

Amongst the strategies offered by Enzyme, Convex, Liquidity and Notional (coming soon) were the most attractive in terms of yield while keeping a quiet low risk profile. However, after careful consideration, we considered that the extra smart contract risk by using Enzyme and its underlying yield source was not worth the extra yield we would be able to get with Treasury funds.

3. Protocol-Owned Liquidity solutions

Objective: At least 1 alternative will be presented to the DAO to encourage Uniswap V2 LPers to migrate to Uniswap V3.

We have launched a pilot on Arrakis Finance on Polygon to encourage LPers to deposit POOL/ETH while earning POOL rewards. Arrakis was chosen over other options such as xToken and Gamma Finance mainly due to its clear dominance on the market (having over x100 times more TVL than its competitors). This ensures that the contracts are more battle tested and therefore, usually safer.

Initial goal for the Arrakis pool was 33K POOL (≈ $21.5K), and we have reached a total of $29K. Therefore, we plan to continue the pilot and examine the results obtained for the future.

4. Prize distribution

Objective: Moving to weekly prizes, maintain sustainable prizes, and build and maintain utilities (Node, Discord, WebApps, Dune) to monitor and measure prize results.

Due to technical issues, it has not been possible to move to weekly prizes. However, we are in contact with the Protocol Team to ensure that once those hurdles are removed, weekly prizes are taken into consideration.

In Q4 2022, there have been 2 changes in the prize distribution, one at the beginning of November, and the next one at the beginning of December. Due to the end of OP rewards on AAVE, there was a sudden drop in %yield right before the end of October. Prizes have been adjusted accordingly to aim for more sustainable distributions while trying to keep good odds for depositors and a big grand prize.

WebApp: Pool Together V4

Dune Dashboard: PoolTogether Weekly Report

Discord Bot.

5. Other

We have also been in contact with PWN and presented to the community the option to use some Treasury funds to fund POOL loans.

Finally, we have also been in contact with Mensari and Myna, which offer accounting tools and services. After checking the tools and prices, we considered that the DAO was not currently looking for professional accounting. Therefore, the quarterly review of inflows/outflows should be enough to inform DAO members of the protocol situation.

Goals

Aligned with the previously mentioned purposes, the Finance Team would have the following goals:

1. Quarterly review of Treasury inflows/outflows

As the PoolTogether community is expanding and attracting more contributors, a detailed view of incomes and expenses is required to determine the runway of the Treasury and be able to plan accordingly.

A quarterly report will be published giving specific and objective information on the inflows/outflows of the Treasury.

2. Prize distribution

Prizes are the main attraction of PoolTogether, so it is important to use them as effectively as possible to grow the protocol.

Moving to weekly prizes is still the main objective, as we consider that this will help unlock bigger prizes which will end up attracting more users. DPR should also be available to allow the protocol to offer a bigger grand prize. With this new tool, different possibilities will be explored to try to get the most out of the prize distribution.

The Finance Team will also build and maintain utilities (Node, Discord, WebApps, Dune) to monitor and measure prize results.

3. Liquidity solutions

The team is committed to keep an eye on Uniswap V3 POL on Ethereum and Polygon, to help balance the liquidity in case it is required.

As a continuation from the previous quarter, the Arrakis Finance liquidity program on Polygon will be maintained while we keep monitoring the results obtained.

Budget

Requested Amount

Amount Token
671.75 USDC
8,795 POOL

Budget Breakdown

Team Members

Role Yearly USD Compensation Commitment Percentage Quarterly USDC Quarterly POOL Contributor Contributor Discord
Lead $90,000 50% 9,450 2,675 underthesea underthesea#4658
Member & Communications $90,000 30% 5,670 1,605 BRONDER BRONDER#4788
Apprentice $50,000 25% 2,813 465 Open Role

We are looking for somebody from the community with interest on the topics covered by the Finance Team and who is willing to learn and give their own opinions and ideas.

Team Expenses

In order to organize certain activities, such as incentivizing liquidity with Arrakis, we request an extra 6,000 POOL.

Previous Budget Surplus

The Finance team keeps using the same 3 out of 6 multisig as the previous quarter (BraveNewDefi, BRONDER, DaBoom, drcpu, TheRealTuna, underthesea). As a consequence, the team inherits the existing budget for transactional costs kept safely in the gnosis safe amounting to:

Description Amount Token
ETH for Operations 1.75 ETH
Extra USDC 17,261.25 USDC
Extra POOL 1,950 POOL

The Finance team is also in charge of the 3 out of 5 multisig belonging to the previous Prize Team (BRONDER, Dylan, Leighton, Ncookie, underthesea). This multisig does not custody any additional funds and is used for pushing new prize distributions.

There is currently ~$175,000 USDC in prize liquidity reserves that can be used as subsidy for Q4. Given that DPR will bring more infrequent prizes, this brings more variance to the prizes. Therefore, it’s requested to increase the amount of liquidity reserves to ensure that the protocol is always able to pay the prizes obtained by users. We consider that $100,000 more should be sent to the Exec Team in order to be used as prize liquidity.

All of the funds not used at the end of the quarter will be rolled over to the next quarter if the team is renewed. If not renewed, all leftover funds will be returned to the PoolTogether Treasury.

Appendix

Token Pricing

Token USD
ETH $1,275
USDC $1
POOL $0.6728370667
2 Likes

As Already mentioned during the council meeting, I fully support the Finance Team Q1 2023 TBR!
Great that you added the third “apprentice” position!

3 Likes

Proposal is live for voting
Onchain: PoolTogether Governance
Snapshot: Snapshot

1 Like