[BIP-117] Holdr Friendly Fork Proposal

Governance General Proposal
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Summary

This proposal seeks to gather Balancer community support and approval for Solace DAO to launch and operate a new Balancer Friendly Fork on Aurora chain, an EVM within the NEAR ecosystem. This newly deployed protocol will be called Holdr, with the governance token HLDR, and ultimately governed by Holdr DAO.

Abstract

If approved, this proposal will result in:

  • Solace DAO launching Holdr as an officially recognized Balancer Friendly Fork on Aurora
  • Balancer DAO Treasury receiving 4% of HLDR total supply
  • BAL tokenholders receiving 1% of HLDR total supply
  • Solace DAO and Balancer DAO research and co-marketing collaboration

Preface

This proposal is shared by Solace’s team and was written by Nikita Buzov (founder). Solace has received a grant of $20,000-worth of AURORA tokens from Aurora to pursue this proposal and launch a Balancer V2 friendly fork. Also, back in summer 2021, Solace DAO has also received a NEAR grant worth of $30,000 from NEAR Foundation to develop Solace, a DeFi Insurance protocol (live across Ethereum, Polygon, Fantom, Aurora). Therefore, Solace has been well supported and integrated within the NEAR ecosystem community, which, along with successful experience operating DeFi protocols, makes Solace team a natural partner within the Aurora’s and NEAR’s ecosystems.

Motivation

Both NEAR and Aurora ecosystems have been steadily growing and developing their unique technology. Over the years they have shown a strong commitment to innovation and user experience, developer community, as well as security! Because of this continued growth, Solace is excited to support their ecosystem and, together with Aurora, identified a need for Balancer V2 technology to become present there.

Background

Solace is a DeFi insurance protocol, founded back in 2020 and first launched in 2021 on Ethereum, later expanding to Polygon, Fantom, and Aurora. Over the past years Solace team has been awarded grants from Polygon, Aave, NEAR, Celer, and Aurora, following successful completion of the specified goals. Additionally Solace DAO has been funded through a seed round in 2021 (raised $1.1M). The team has displayed over time a great track-record of shipping products, developing and setting up complex architectures, operating protocols on multiple chains. Solace’s team is currently composed of 10 people: 5 engineers, 1 UI/UX designer, 2 BD & marketing, 1 operations, 1 founder (also an engineer).

Specification

Solace is set to launch Balancer V2 fork in the most current production deployment, including all the core technology. With security in mind, Solace will not make any changes or updates (unless explicitly requested by Balancer DAO, or an emergency response to a verified vulnerability is required) to the core smart contracts. This work has been complete and the contracts are live in production. I invite you to check and verify both the application and the deployed contracts following these links:

Please note that LBP UI and the Bribe market functionality are still in development, but should be completed in the following weeks, ahead of the HLDR token launch (tentatively scheduled for December’22).

Holdr will also follow the exact same governance process and tokenomics design as veBAL, locking 80/20 HLDR/wNEAR BPT with a max period of 1 year to control the HLDR liquidity mining emissions across gauges.

HLDR Supply and Distribution

The total supply of HLDR will be 100,000,000 HLDR tokens and distributed through the following allocations and schedules:

5% - Balancer

A portion of the Holdr protocol should be owned by both the Balancer’s treasury and BAL holders. This would be following a standard set by a previous Balancer friendly fork, Beethoven X. We propose, in a similar fashion, that 5% of the total supply of HLDR should be allocated as follows:

  • 4% provided to the Balancer DAO Treasury (2y linear vesting, 6mo cliff).
  • 1% provided as an airdrop to BAL holders as follows:
    • A backdated snapshot will be taken for all BAL holders
    • Only holders with a BAL value greater than $100 USD will be eligible
    • A 2x multiplier will be assigned to BAL and BAL/ETH 80/20 BPT holders, including the holders of veBAL locking their BPTs, on Ethereum
    • A 1x multiplier will be assigned to Arbitrum BAL and BAL/ETH 60/40 BPT holders
    • A 1x multiplier will be assigned to Polygon BAL, USDC/MATIC/WETH/BAL 25/25/25/25 BPT, and BAL/ETH 80/20 BPT holders.

To achieve a more equitable distribution of the airdrop tokens, they will be distributed based on the weights above, not based on the USD value of the holdings. Note, any qualifying address will need to have a Holdr LP position, worth at least $100, staked in incentivized liquidity mining. A snapshot date will be announced within a month after the launch, if this vote is passes. The distribution mechanism of the tokens will be defined collaboratively between the Solace team and the Balancer community and the requirements outlined here are subject to small revisions.

15% - Solace DAO

This allocation will be awarded across Solace DAO, Solace Launch DAO, and the active team members to compensate for the on-going work and to support Holdr protocol operations. The distribution will happen on a 2 year linear vesting schedule with a 6-month cliff.

15% - Holdr DAO Treasury

The Holdr DAO will be formed overtime by the community and will inherit this treasury to govern and financially support any future developments, grants, contributor compensations, etc. Solace team’s goal over the next couple of years will be to pass on the governance as the Holdr DAO matures. This treasury will be be vesting linearly for 5 years, with a 1-year cliff.

14.125% - Ecosystem Partners & Investors

This allocations will be utilized to effectively partner with various protocols within NEAR and Aurora ecosystems, as well as to raise some capital to finance any operational costs. Vesting will follow a linear schedule of 2 years, with a 6-month cliff, similar to the Balancer DAO and Solace DAO allocation.

2% - HLDR Liquidity Bootstrapping

These funds will be used to seed and launch HLDR token using Liquidity Bootstrapping Pool.

48.875% - Liquidity Mining Emissions

Similar to Balancer’s schedule, Holdr will adopt emissions halving every 4 years. The initial emissions rate will start at 150,000 HLDR/wk.

Friendly Fork Agreement

If accepted by the Governance process of both DAOs, this friendly fork will start effective immediately. There is no expiry date to the agreement; however, both DAOs can override this Friendly Fork agreement through their governance process to remove the Friendly Fork title with a one-month notice period. If such decision passes a vote, Balancer DAO will loose claim to all unvested HLDR tokens granted to their DAO Treasury.

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pretty solid proposal imo. if you all have a discord or something please send me the link so I can hang out and stay informed as things progress :slight_smile:

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Thank you, appreciate the kind words. We’ll keep the communication in Solace’s discord for now and have a separate Holdr section. Here you go, ser! Solace

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Great proposal and I am a big fan of the Solace team from the events they have co-hosted with Balancer in the past. Nikita in particular has always been a big supporter of Balancer in offline events and I am happy to see Solace proposing to enter the Balancer ecosystem.

I have one thing I would like more clarity on as I see this verbiage mentioned in more and more partnership proposals:

Orb Collective has taken over all marketing activities for the Balancer DAO, and my small marketing team that was once housed in Balancer Labs moved to Orb back in August. @nikitabuzov could you please be more specific about what kind of co-marketing expectations the Solace team is looking for from Orb? Not setting clear guidelines from the start has lead to different opinions on what level of marketing output projects can expect. Since you know me and have worked with my team, you know that we will give a high level of effort to whatever parameters we agree upon here, but I want the community to have clarity on the terms right away. Thanks!

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Excited to see where this goes. The Solace team have a history in the space and I think it’s worth keeping an eye on how they plan to use Balancer technology.

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We are glad to see Solace presenting a solid plan for Holdr. We believe Solace are a strong team to handle a Balancer FF on Aurora.

We look forward to seeing how this plays out!

Conflict of Interest: StableNode is an investor and advisor to Solace*

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Thank you, Mike! We’re looking forward to continue developing our relationship with Balancer DAO and the team.

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Hi Meghan! I appreciate the positive feedback and looking forward to work together on this, pending the proposal’s approval.
Regarding the specific expectations from the marketing side, we’d like to execute on the following items together:

  1. joining the Balancer community on your Twitter Spaces pre-LBP, raising awareness for this proposal and Holdr’s gameplan;
  2. After HLDR’s LBP, depending on the success, we propose doing a recap and highlight the way Balancer technology was used - similar to Balancer Facilitates Record-High Liquidity Bootstrapping Pool For HydraDX | by Stanislav Kozlovski | Balancer Protocol | Medium;
  3. When the implementation and pools are live and have some volume and TVL, we could do another twitter spaces with NEAR, Aurora, Solace and Balancer, and retweet some tweets from participating sides;
  4. Could do some social media activities similar to what Balancer did during Beethoven’s launch on Optimism.
    Hope this all sounds reasonable. Please let me know if you’d like me to provide more specifics. Thank you, Meghan!
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Looks great! Thank you and look forward to working together.

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Not saying this to push back on your proposal, but I think it’s worth highlighting past discussions/votes around Friendly Fork token allocations

From the original Friendly Fork Proposal:

  • Balancer will not give out grants for forking teams, and encourage teams to issue their own separate token (let’s call it f-BAL) on the host chain
  • Any eventual protocol revenue or biz model needs to accrue to f-BAL (or to a derivative of it)
  • Total supply of f-BAL should be capped
    • If uncapped, there should be a detailed explanation of how it would evolve, under what circumstances it could change, etc, so that the total supply after X (1/2/4/8) years could be estimated with some precision
  • 20% of f-BAL’s total supply is allocated to the BAL community:
    • 15% to the Balancer Treasury
      • Subject to a vesting schedule of 6 months
    • 5% airdropped pro-rata to a snapshot of BAL holders on mainnet
      • Claimable via a merkle redeem contract
      • Should account for indirect BAL ownership:
        • For BAL in V2 pools: airdrop goes to the BPT holders
        • If those BPTs are staked and/or locked inside the Balancer ecosystem: airdrop goes to the stakers/lockers
      • The forking team might (but is not required to) take into account other indirect forms of BAL ownership
    • Not subject to a lockup
      * Minimum of 0.5 BAL to qualify for airdrop, to avoid long merkle branches full of dust f-BAL
      * After 3 months, all unclaimed f-BAL is redirected to the Balancer Treasury
      * This would naturally include the airdrop to all BAL holding addresses that can’t claim f-BAL such as lending pools, bridges and most CEXs
  • 80% of f-BAL’s total supply is distributed among f-BAL’s community, which includes:
  • 65%: f-BAL Ecosystem Fund: liquidity mining, grants, partnerships and other incentive programs
  • 15%: The forking team, subject to a 1 year cliff and a 4 years vesting schedule

From BeethovenX’s Snapshot Vote:

As we launched our token prior to the definition of the Friendly Fork model, the Ballers have agreed to a one time exclusion for Beethoven X. The percentages above are not reflective of the requirements for future Friendly Forks.

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Great proposal. Solace is a very solid team that i would trust to make this a succes.

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I appreciate the reference to the original Friendly Fork Proposal, we’ve used all the past posed and passed proposals as guidance, however haven’t seen any Friendly Forks to allocate 20% of their total supply to Balancer. One risk we must avoid, is BAL holders just cashing out on “f-BAL”, especially without any lock-ups, so I’m curious if there has been any research/analytics done on how BAL holders acted with the forks airdropped tokens.

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I’m not saying what the allocation should or shouldn’t be, I just think that if we’re going to discuss and vote on another FF, people should be aware that that’s what the original FF framework says.

To add context for other readers, all of the FF proposals are:

  • Beethoven (passed and thriving)
  • Hexagon (passed and later revoked for not delivering anything; also their airdrop requirements were :poop:)
  • Symmetric (rejected due to not being ready though I believe they’re trying again soon?)

So in summary, there’s a grand total of one active FF, which is BeethovenX

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Thank you, I appreciate further context. Holdr is looking forward to join the “thriving” ranks along with Beethoven :slightly_smiling_face:

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https://snapshot.org/#/balancer.eth/proposal/0x12bf815724bdd20ad69b788d55c6755e4767a859629d32e722c18767e1a44724