BDSP End of 1Q24 Update

March has been a very productive month for Balancer and the BDSP. We’ve continued to accomplish our Q1 objectives and have established a solid foundation for lots of activity in Q2.

For reference, please review BIP-525. Also, please see the achievements from the mid-quarter update.

This update will focus on progress made towards the Q1 objectives that have occurred since the previous update.

  1. Transition Balancer related BD activity from json to lipman (completed)

  2. Onboarding of lipman to broader Balancer ecosystem (completed)

  3. Develop general understanding of internal Balancer operations + processes for BD support (completed)

  4. Develop understanding of Maxi priorities, their ideas for growth, and include within a prioritized list of initiatives to pursue in Q1. (completed)

  5. Meet with existing, key Balancer partners to get introduced, offer support, uncover needs, etc. (completed)

  6. Develop grasp of V3 and its implications for growth to position BD ahead of Q2 launch (ongoing)

  7. Apply for new grant programs and monitor current grant programs (completed)

  • See application here. This grant will be given out in two waves, and Balancer unfortunately did not receive the grant during the first wave. However, Balancer is already working with EtherFi and Kelp to use a portion of their grants with Balancer. Balancer will also reapply for the second wave (Submissions due end of April).
  1. Pursue grants for Gnosis, Avalanche, Polygon zkEVM (partners only), Scroll (TBD), Linea (TBD), etc. (see new chain strategy discussed below)

  2. Create a framework to quantify layer 2 expansion opportunities and collaborate with Balancer DAO developers on the execution of each expansion (completed)

  • One significant effort that’s occurred since the last BDSP update is the change in strategy for new chain launches. The mid-quarter update stated Balancer would not deploy on new chains until after v3. However, after several internal discussions, the team is aligned on moving to select new chains to capitalize on market expansion opportunities and supporting key partners on these new chains now. A cross-functional team led by the BDSP including the Maxis and engineering team are collaborating on this effort. More detail below.
  1. Develop and maintain relationships with potential new networks (e.g. Scroll, Linea, X1) and current networks (e.g. Arbitrum, Optimism)
  • Extensive discussions and negotiations have occurred with numerous new chains including (in no particular order):

    1. Metis
    2. Scroll
    3. Linea
    4. Fraxtal
    5. BNB
    6. X Layer (OKx)
    7. Mode
    8. Build on Bitcoin (BoB)
    9. SEI
    10. Injective
    11. Zk Link
    12. Eclipse
    13. Monad
  • The BDSP has also entered into early discussions with Arbitrum and Base about ways to get more closely aligned and collaborative.

  1. Perform a competitive landscape review to understand where Balancer sits in comparison to industry peers, and understand gaps via the analysis and work with the Balancer DAO to determine how to close the aforementioned gaps (ongoing)

  2. Frame Key Performance Indicators and success targets for 2024 (goals and objectives for Q2 can be found here)

New chain initiative overview

As part of our discussions, the BDSP worked to understand the strategic opportunity each chain offered and which, if any, of the following each chain was willing to provide:

  1. Amount of incentives the chain is willing to commit to Balancer
  2. Amount of liquidity the chain would seed on Balancer (and what it is)
  3. Amount they’d be willing to fund BAL’s technical launch costs
  4. Amount they’d be willing to fund BAL’s technical maintenance costs
  5. Launch partners - specifically yield bearing tokens (stables, LSTs, LRTs) and lending protocols
  6. Timing of partners mentioned in #5 going live.

The BDSP also collaborated with members from Balancer’s engineering team to understand the technical dependencies for each new chain and where blockers may exist, especially due to v3 taking roadmap priority. Ultimately, the Graph was the primary dependency given Balancer’s tooling is built around it and the potential significant amount of overhead/distraction required to leverage other subgraph providers.

In addition, we worked to understand if the chains had the following infrastructure:

  • Tenderly
  • Chainlink
  • Gnosis safe
  • Alchemy/Infura
  • Reputable bridge(s)

As a result of the process above, the BDSP has identified 3-4 chains of the 10+ we evaluated to pursue in the short term. Final negotiations are occurring now and these chains should be going through Balancer’s governance process in the next couple weeks. This excludes securing a relationship with Monad for a targeted Q4 launch once Monad launches its mainnet.

Additional highlights for the second half of Q1 include:

  • The LRT tripool reached $120m in TVL
  • Cultivating strong relationships with key LRT partners such as Renzo, Etherfi, Swell, Kelp, Vector Reserve, and others. These relationships are evident from TVL growth, 8020 launches, and by partners telling us they only want to work with Balancer on new chains.
  • Strengthening relationships with existing key partners such as Frax.
  • Developing relationships with key industry players. A few examples include the defi leadership team at Base, Aave for GHO liquidity on Balancer, Trident/Paypal/Paxos for pyUSD, Paradigm, and many others
  • Evaluating CCIP with Chainlink and the Maxis for easier partner onboarding
  • Secured 100% of Balancer’s vlAura for the BDSP’s discretionary use for growth opportunities.
  • Outreach and exploration of opportunities with projects across an array of functions (too many to list).
  • Organizing points programs and working with design + engineering to include explanations for users. Example here.
  • A few examples of new gauges / pools include:
    • GHO / pyUSD
    • Ethena (rate provider being created in partnership with Redstone)
    • Genesis LRT
    • Magpie (LRT)
    • Inception (LRT)
    • Puffer (LRT)
    • Renzo (Arbitrum)
    • Inverse (sDOLA)
    • Kelp (KEP)

We are looking forward to continuing our momentum heading into Q2.