Summary
- Our restructuring into a DevSecOps team with a dedicated BD unit consisting of experienced DAO members kicked off its first month
- We finally shipped the first set of Balancer v3 fees and enacted the new fee model after a longer delay because of smart-contract dependencies
- Our strong BD efforts resulted in securing significant liquidity on Avalanche and other chains, incl. Token Grants on Arbitrum and Optimism
- The Maxis secured 250k USDC to be utilized in an innovation fund to test novel and exciting products
The above summary highlights outline that the DAO is currently in a unique position to ship innovative products and services while focusing on strengthening market share of Balancer v3. Given these objectives, let’s break down the advancements we made for our objectives as outlined in our funding proposal for Q2-Q3 2025
Initiative 1: On-chain Operations and Security Management (DevSecOps)
Go-live of Fee processing on Balancer v3
Our most noteworthy achievement for the month of April is that we completed the first round of fee processing on Balancer v3 with our new fee processing infrastructure. This project was initially planned to be completed in early 2025. However, the needed migration of the needed migration of the fee controller (BIP-804) caused a multi-week delay. The migration concluded successfully and we were able to process $>100k in accumulated fees and distribute them according to our new protocol fee model
In summary, these changes were going into effect as of the second week of April:
- For Balancer v2, non-core pool fees will not be recycled for core pool voting incentives anymore, but distributed to the corresponding targets (veBAL holders and the DAO)
- Core pools will get a 70% fixed share of fees to be allocated to voting incentives
- Non-core pool fees will be distributed between veBAL holders and the DAO
Under the hood, we had to make significant changes to our code base, which is now fully live in our fee allocator v2 repository.
The go-live of the new fee processing pipeline involved cross-team coordination and involved the help of many DAO contributors such as the smart contracts team, the data team and the Maxis. Big shout-out to @gosuto and jalbrekt for building the necessary infrastructure on Maxis side.
To give a short overview of the new fee processing infrastructure, here is a short rundown of all the components needed:
-
Smart contracts (developed by Balancer labs):
1.1 ProtocolFeeController: controls fee collection and accounting
1.2 ProtocolFeeSweeper: Handles the sweeping of tokens to a designated target
1.3 CowBurner: Implements the processing of fees via CowSwap orders -
Off-chain components:
2.1. Fee Poker bot: checks if enough fees have been accumulated to be collected and processed, can poke the FeeSweeper contract to collect the fees
2.2 Cow Watchtower: needed to place CowSwap orders on Cow Explorer
2.3 Fee Allocator: our new code-base to calculate earned fees and allocate them based on our fee model to veBAL hoders, the DAO and voting markets
Continuous improvements to the Operations UI
Additionally, we worked on our code-base to support the Balancer Alliance BIP which is planned to go live around the end of May
Another success story is the continued improvement of our Operations UI, that is slowly getting traction and adoption. Parifi for example is one of the first projects fully utilizing and managing our incentive management infrastructure successfully for their pool on Base. In terms of feature improvements, this is a small selection of changes implemented in April:
- Improved Payload builders
- Hook Dashboards and Payload Manager
- Support for Sonic for core components
- Migration and refactoring of Buffer viewer and payload builders
- Improved Gauge creator with cross-checks for gauges that have not been added to the gauge controller yet but have been deployed on-chain
Oversight of our DAO Wallets
@gosuto has been working together with @kpk to optimize our DAO portfolio and management. This resulted in a draft currently under review on the forums. The main objectives are to
- Clean-up and redistribute portfolio positions into a meaningful one
- Simplify the signer set for better execution flow by including the Foundation members as signers
If you haven’t done so already, please review this important proposal and provide feedback.
Oversight and advisory of the internal security committee council
At the beginning of April, we kicked off a series of internal meetings to coordinate security topics across the organization. Our current main focus is the finalization of v2 pool monitoring and the design of a new monitoring and security setup for Balancer v3. I will share an update on these topics once they are finalized.
Initiative 2: Growth
This month, we successfully brought the EZKL collaboration to production, with plans for further expansion in the coming month. Additionally, we partnered with QuantAMM to support their preparations for their upcoming mainnet launch scheduled for mid-May 2025. On the strategic front, we engaged with industry leaders to discuss BPT as collateral strategies and developed a feasible implementation solution. These initiatives collectively strengthen our position in the market while expanding our collaborative network.
Etherfi ties have grown stronger via Arbitrum initiative growing eBTC TVL significantly on the network.
Due to Avalanche expansion and active efforts we have onboarded new partners such as Euler boosted pools, K3 and Re7 as curators, Avant, Agora, and reignited relationships by gogopool and benqi to grow the network quickly to nearly 20M TVL.
New partners across ecosystems have become Fluid for boosting assets, via Lido. As well as Yield fi (yUSD), Stable Labs (USDX), and LoopFi (slpETH & slpUSD)
On the 8020 front Parallel protocol and Paraswap, now Velora will be leveraging Balancer V3 as their governance token venue of choice.
Furthermore, we pushed forward the go-live of the Balancer alliance program. Two strategic partners such as Rocket and Lido came forward with their proposals to participate in the program. The program is scheduled to go live at the end of May.
Initiative 3: Interfacing with Product Development
Volume Creation:
- Internal bot sources volume for pools that would otherwise have little to no volume. It also helps kickstart an environment of competition so that other operators interact with Balancer pools. One example being the MEV hook pool, by running a bot against the pool it helped the other operators discover the pool more quickly and taxed them for the opportunity to rebalance the pool. So far the bot has brought ~$2.3M of additional volume to Balancer pools since the initiative started at the beginning of April. One additional side benefit is being able to test new pool type functionality before any aggregator integration.
Product Support:
- Oracle pools/surge hook - continued to test many different variations of WETH/USDC oracle surge pools over the month of April. The four most recent test pools have brought ~$5M of volume to Balancer, resulting in $28K of fees to LPs + DAO since April 30th (7 days). Continue to optimize surge parameters for many different pool variations (stable, blue chip, volatile, etc.)
- reCLAMM - spun up 7 different reCLAMM test pools with various parameters in order to gather results which allows for discovery of optimal settings for different token pairings. Additional functional testing has uncovered the need for slight upgrades to the new pool type during its development stage.
- Prototyping and operations support - tested and provided feedback for reCLAMM and surge simulator UI created by blabs. Additionally we’ve taken up handling certain erc4626 and rate provider reviews which includes running fork tests created by blabs.
Budget for April 2025
Based on our learnings from the last funding round, we significantly reduced our discretionary ask from $15k USDC a month to $5k USDC a month. These funds are currently mostly used for freelance developer work. We are happy to currently work together with raqq who has been essential in helping us improve the operations UI. Therefore, our current cost basis for April is as follows:
| Resort | Amount | Description |
|---|---|---|
| Operations UI | $2’820 | Hooks parameter dashboard, MEV Catpure hook dashboard and payload builders, Code refactors and buffer viewer improvements |
Therefore, out of the $5k allocated, we utilized $2’820 USDC for services rendered as outlined above. Our operations multi-sig currently holds 29520 sUSDS which corresponds to $31k USDC as of writing of this update (of which the $2’820 will be deducted)
Conclusion
In conclusion, we are on track to finalize our key objectives for Q2 which include
- Finalization of the new fee processing and go-live of the new fee model
- Optimization of core functionality of fee processing for v3
- Continued improvement on Partner tooling
- White glove services for key partners
- Increased support and testing for product development