[BIP-246] Enable wstETH/bb-a-wETH Gauge [Arbitrum]

BAL Gauges
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Summary:

This pool uses the ComposableStablePoolFactory-v3 1 which addresses the reentrancy vulnerability disclosed during February 2023. This gauge is uncapped, and would enter as a “core pool” under BIP-19. This means 65% of 50% of yield generated by this pool is to be used for bribing for votes on it via Hidden Hand. The remaining 35% goes to Balancer DAO as revenue.

The pool wstETH/bb-a-wETH is to replace the wstETH/wETH pool on Arbitrum.

The current wstETH/wETH contains $17,826,606 in TVL at the time of writing and is the second largest wETH pool on Balancer’s Arbitrum deployment.

References/Useful links:

Protocol Description:

This pool utilises wstETH and linear pool bb-a-wETH which deposits wETH into Aave v3 wETH reserve. The linear pool utilises a wrapper developed by Aave Companies.

Motivation:

With the introduction of wstETH to Aave v3, the author expects users to deploy yield maximising strategies utilising the wstETH/wETH loop. This is expected to generate borrowing demand for wETH and deposit APR for those that depsit wETH into Aave v3.

Incorporating the bb-a-wETH will lead to additional revenue to Balancer DAO and also additional incentives flowing through to Hidden Hand which veBAL holders can benefit from.

Specifications:

  1. Governance: Find more information about governance on Lido’s forum.
  2. Oracles: Arbitrum wstETH Oracle, see here
  3. Audits: For Lido Protocol and Aave v3, see below

  1. Centralization vectors: See here.

  2. Market History: See wstETH and wETH.

  3. Value: Balancer will earn the protocol fee on wstETH yield and deposit yield generated by Aave v3 on Arbitrum via bb-a-wETH.

    Link to Pool: 0x5A7f39435fD9c381e4932fa2047C9a5136A5E3E7
    Link to Gauges: 0x74d3aa5F9A2863DC22f6cF9c5faaca4E1fc86F75
    Transaction Specification: The DAO Multisig 0x10A19e7eE7d7F8a52822f6817de8ea18204F2e4f will interact with the AuthorizerAdaptor at 0x8F42aDBbA1B16EaAE3BB5754915E0D06059aDd75 and call performAction with the GaugeController at 0xC128468b7Ce63eA702C1f104D55A2566b13D3ABD for the target(address) argument and using 0x3a04f900 followed by the gauge address 0x74d3aa5F9A2863DC22f6cF9c5faaca4E1fc86F75 and the corresponding gauge type for the data(bytes) argument.

data(bytes) : 0x3a04f90000000000000000000000000074d3aa5f9a2863dc22f6cf9c5faaca4e1fc86f750000000000000000000000000000000000000000000000000000000000000004

Disclosure:

This proposal is the sole work of @Llama contributor, @Matthew_Graham, via the legal entity TokenLogic. Llama is a Service Provider to Aave DAO.

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https://snapshot.org/#/balancer.eth/proposal/0x8ddd98b8335e5ea184b66b26e59f2f1b3e1e2b83d30004120e9e9a0ae40ea97c

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