karpatkey’s relationship with the Balancer ecosystem dates back to 2020 where karpatkey has played a key role in supporting the Balancer ecosystem—currently facilitating $155mln liquidity to its pools (see”Balancer’s TVL facilitated by karpatkey” below), enabling its deployment on Gnosis Chain, acting as a delegate for AAVE and ARB, facilitating strategic partnerships and building an infrastructure for its financial health.
As per BIP-103, since November 2022 karpatkey is Balancer DAO’s partner for treasury management, responsible for deploying yield-generating strategies, risk management, and reporting.
Below is a timeline summarising our activities from the beginning of our collaboration with Balancer DAO:
What follows is a detailed review of our work with the Balancer DAO for 2024 along with upcoming initiatives across various areas.
Financial Results
Since its inception, the Treasury has achieved:
- Accumulated Net revenue of $475,772 USD
- An average Net APY of 4.53%
Based on the most recent monthly report detailing the treasury’s performance for December 2024, the managed Treasury has generated:
- $14.9M of ncAUM (non-custodial assets under management)
- 97.1% of capital utilisation
- An APY of 6.2%
- Monthly DeFi results of $75,219
Additionally, as per the December 2024 report the following provides a graphical representation of the fund distribution across asset classes in the managed treasury:
Given the managed GNO positions, as per BIP-696, the treasury now operates 83.74% of assets on Ethereum mainnet and 16,26% on Gnosis Chain.
The managed treasury’s current exposure to protocols across DeFi is as follows:
Strategy, Reporting & Execution
Since the beginning of 2024, we have put forward the following initiatives:
- Governance and Strategic Delegations
Throughout 2024, Balancer DAO took significant steps to strengthen its governance framework and forge strategic alliances. By delegating 2M ARB voting power to karpatkey (BIP-611), we aligned our governance strategies with the Arbitrum ecosystem, enhancing our ability to support collaborative initiatives. Additionally, by locking SAFE balances into a reward booster (BIP-621), we secured future benefits to optimise the DAO’s resources. Lastly, our strategic partnership with CoWDAO (BIP-628) led to the launch of CoWAMM pools on Balancer, expanding our ecosystem and solidifying relationships with key stakeholders in the decentralised finance space.
A detailed list of contributions can be found under our delegation thread.
- Treasury Optimisation
In 2024, we prioritised the efficient allocation of Treasury assets to minimise risk and diversify holdings. For instance, we deployed 9,051 idle GNO valued at $1.52 million to Stakewise V3 vaults (BIP-696), achieving an average 7.7% APY and generating approximately $116,000 in annualised projected revenue. We also utilised idle USDT to onboard Gyroscope’s sGYD strategy (BIP-714), further diversifying our stablecoin holdings and enhancing financial resilience. Transferring stkAAVE to a karpatkey-managed SAFE (BIP-708) allowed us to unlock discounted GHO borrowing rates while earning yield on AAVE. Finally, the DAO capitalised on a 644k COW airdrop (BIP-710), leveraging a token swap agreement to boost the Treasury’s holdings and reinforce our partnership with CoWDAO.
- Transparency and Accountability
To enhance financial oversight and operational transparency, karpatkey implemented new frameworks for accountability in 2024. The introduction of a comprehensive financial reporting system (BIP-648) provided monthly reports, BAL budgeting insights, and State of the DAO presentations, significantly improving governance and decision-making processes. Building on this, we established a monthly spending accountability framework (BIP-742), requiring all service providers and grantees to submit detailed spending reports. Together, these initiatives have strengthened our commitment to transparency and improved the DAO’s fiscal discipline.
- Risk and Operations
Operational efficiency and risk management were key areas of focus for BalancerDAO in 2024. By migrating to Roles V2 and updating Treasury permissions, we improved auditing processes and enabled streamlined, secure deployment actions, including gas-efficient and MEV-protected swaps. Permission updates on both Ethereum Mainnet (BIP-748) and Gnosis Chain (BIP-732) expanded our Treasury’s flexibility by incorporating new strategies like GHO carry trades, Stakewise vaults, and Origin assets. Finally, the onboarding of Balancer DAO onto karpatkey’s Execution App would enable us to manage exits from DeFi strategies more effectively through the deployment of Swapper and Disassembler roles, further strengthening operational agility.
Strategic roadmap
As our collaboration with the Balancer DAO continues to grow and evolve, we remain committed to enhancing every financial aspect of the DAO and deeply engaging with its activities and core products. For the year 2025, we plan to create and execute the Balancer DAO Financial Master Plan that will aim to:
- Maintain the highest level of security for non-custodial risk and asset management by introducing refined strategies and streamlined exit mechanisms, ensuring proactive and adaptive allocation framework.
- Optimise the existing portfolio by:
- Deploying additional assets into yield-generating strategies in a risk-averse manner.
- Unwinding existing positions no longer aligned with the DAO’s objectives and re-deploying resulting assets.
- Secure long-term growth and resilience by:
- Forging strategic partnerships with aligned DAOs.
- Increasing runway funds in stablecoins.
- Developing a BAL Token Sustainability Plan to improve relevant on-chain metrics.
Risk Management
- Internally built and proposed onboarding the Execution App, enabling Endowment asset managers to quickly execute pre-designed strategies for emergencies, including allowlisted swaps and exits.
- This eliminates reliance on protocol user interfaces and reduces human error and time consumption.
- While ensuring private key security and only approved strategies can be carried out through the app.
- Hypernative alerts for each protocol in the permissions preset, covering key aspects like oracle pricing, ownership changes, pool liquidity, withdrawal queues, collateral ratios, health factors, and other DeFi metrics and smart contract risks.
Upcoming Initiatives
- Bolster the resilience of our risk management framework by:
- Developing Guardians—automated bots designed to execute portfolio and risk management strategies. These bots respond to predefined risk triggers, such as suspected exploits, unusual pool activity, or sharp declines in collateral ratios. The karpatkey team is collaborating with Hypernative to evaluate alert accuracy and third-party models, aiming to improve Guardian precision and reduce false positives.
- Continuously researching protocols and setting alerts, this is an ongoing process as we continually integrate new protocols on our PURs. To enhance efficiency, we are working on automating significant portions of this process.
Balancer’s TVL facilitated by karpatkey
As per the latest monthly report which covers the existing positions till , karpatkey played a key role in providing TVL while managing both its own funds and those of partnering DAOs. Below is a table showing the facilitated TVL by pool across Balancer (Mainnet and Gnosis Chain) and Aura:
| Position | Blockchain | TVL |
| wstETH/GNO-Unstaked | Gnosis | $23,549,222 |
| rETH/WETH | Ethereum | $12,805,637 |
| WETH/wstETH (Aave boosted) | Ethereum | $9,282,555 |
| COW/WETH-Unstaked | Ethereum | $7,451,800 |
| osETH/WETH-Staked | Ethereum | $6,086,827 |
| wstETH/WETH | Gnosis | $6,007,539 |
| COW/GNO | Ethereum | $5,969,812 |
| wstETH/GNO (Aave boosted) | Gnosis | $4,738,702 |
| rETH/WETH | Ethereum | $4,694,677 |
| WETH/ETHx (Aave boosted) | Ethereum | $4,505,521 |
| WETH/GNO (CoW AMM-f72d)-Unstaked | Gnosis | $4,492,509 |
| wstETH/WETH-Unstaked | Gnosis | $4,199,928 |
| WETH/wstETH (Aave boosted) | Gnosis | $4,161,420 |
| sDAI/USDC.e/USDT (sBAL3)-Unstaked | Gnosis | $3,760,294 |
| sDAI/wstETH-Unstaked | Gnosis | $3,618,984 |
| rETH/WETH (ECLP)-Unstaked | Gnosis | $3,536,130 |
| Staked auraBAL Compounder | Ethereum | $3,430,679 |
| WBTC/WETH-Unstaked | Gnosis | $3,140,870 |
| wstETH/sDAI (CoW AMM-b72e)-Unstaked | Gnosis | $3,019,453 |
| wstETH/WETH (ECLP)-Unstaked | Gnosis | $2,881,873 |
| COW/wstETH (CoW AMM-d2f1)-Unstaked | Ethereum | $2,459,121 |
| WETH/osETH (Aave boosted) | Ethereum | $2,422,378 |
| GNO/OLAS (CoW AMM-5400)-Unstaked | Gnosis | $2,183,975 |
| GNO/SAFE (CoW AMM-c286)-Unstaked | Gnosis | $2,136,446 |
| wstETH/WETH (v2) | Ethereum | $1,964,063 |
| GNO/sDAI (Aave boosted) | Gnosis | $1,882,491 |
| auraBAL/B-80BAL-20WETH | Ethereum | $1,809,398 |
| wstETH/WETH (v2) | Ethereum | $1,713,927 |
| Locked B-80BAL-20WETH | Ethereum | $1,645,561 |
| Locked AURA | Ethereum | $1,367,894 |
| GNO/COW (CoW AMM-0bae)-Unstaked | Gnosis | $1,257,172 |
| wstETH/COW-Unstaked | Gnosis | $1,248,918 |
| COW/GNO-Unstaked | Gnosis | $1,233,854 |
| Staked auraBAL | Ethereum | $1,164,238 |
| wstETH/WETH (v2) | Ethereum | $1,023,797 |
| wstETH/BAL/AURA-Unstaked | Gnosis | $973,509 |
| rETH/WETH | Ethereum | $947,954 |
| SAFE/GNO-Unstaked | Gnosis | $905,046 |
| COW/WETH | Ethereum | $785,139 |
| GBPe/sDAI-Unstaked | Gnosis | $747,544 |
| USDC/WETH (CoW AMM-8b91)-Unstaked | Ethereum | $686,591 |
| rETH/WETH | Ethereum | $567,152 |
| Locked AURA | Ethereum | $556,505 |
| EURe/sDAI | Gnosis | $504,945 |
| stEUR/EURe-Unstaked | Gnosis | $467,416 |
| rETH/WETH (ECLP) | Gnosis | $169,124 |
| GIV/GNO-Unstaked | Gnosis | $167,877 |
| SAFE/WETH (CoW AMM-57e1)-Unstaked | Ethereum | $148,448 |
| Staked auraBAL Compounder | Ethereum | $123,612 |
| 50wstETH/25WBTC/25SOL (CoW AMM-1d32)-Unstaked | Ethereum | $97,645 |
| wstETH/COW | Gnosis | $97,416 |
| osETH/WETH | Ethereum | $93,235 |
| Staked auraBAL Compounder | Ethereum | $77,825 |
| Locked AURA | Ethereum | $29,845 |
| WXDAI/GNO-Unstaked | Gnosis | $21,515 |
| Locked AURA | Ethereum | $8,207 |
| COW/GNO-Unstaked | Ethereum | $5,864 |
| Locked AURA | Optimism | $2,459 |
| WBTC/wstETH (CoW AMM-6be4)-Unstaked | Ethereum | $2,325 |
| bb-a-USD (v3)-Unstaked | Ethereum | $474 |
| wstETH/GNO | Gnosis | $177 |
| Locked AURA | Optimism | $120 |
| Total | $155,035,634 |
Thank you for entrusting us with this vital role. We remain committed to continuing our contributions and dedication to support the ongoing success of the Balancer DAO.