Whitelist Stake DAO to allow the protocol to lock B-80BAL-20WETH, and create a liquid locker and the associated strategies.
Rationale
Stake DAO is a non-custodial platform built on top of decentralized protocols that enables anyone to easily grow their crypto portfolio, which recently released a new feature called the Liquid Lockers that will help accelerate the lock of tokens with a ve model.
Itâs a new feature built for tokens with ve model allowing users to keep a liquid position while enjoying some yield and the associated voting power (which can both be boosted with veSDT)
The liquid locker will allow users to lock B-80BAL-20WETH and receive sdBAL, which can either be staked in the reward contract, or used to add liquidity in the strategy. sdBAL holders will be able to earn a native yield, vote or sell proposals & gauges boosted positions voting power, while keeping a liquid position.
The strategy will require a gauge for the sdBAL/B-80BAL-20WETH pool on Balancer, to ensure the liquidity of the token.
Furthermore, as other protocols have done it, Balancer could help seed the liquidity pool to ensure liquidity for sdBAL while generating revenues for Balancer.
Technical implementation:
Include sdBAL locker in the Smart Wallet Whitelist 0xea79d1A83Da6DB43a85942767C389fE0ACf336A5
Once the sdBAL/B-80BAL-20WETH pool is created, include it into the gauge controller
Wouldnât users lock BPT instead of BAL, where BPT = 80 BAL: 20 ETH LP position. Otherwise Stake DAO would have to put up the ETH themselves if they want any power. Pretty low effort proposal tbh
Hey guys, just figured out I could share a little case study of another protocol which whitelisted Stake DAO and supported their locker: Angle.
The Angle locker has had a tremendous impact on the rate of locking of Angles, and now more than 25% of veANGLE supply comes from Stake DAO. Since the Angle locker was shipped, 75% of new veANGLE minted come from it. Furthermore, more than 75% of Angle emissions are locked through the locker, leading to $ANGLE in deflationary territory rather often.
This dynamic lock activity is due notably to the fact that the Angle team has supported the peg of sdANGLE/ANGLE and is therefore giving comfort to their community with regards to this liquidity risk.
Furthermore, even though the fact that those sdANGLE are âliquidâ, this liquidity actually proved to increase the locking pace dramatically. When rewards for the sdANGLE/ANGLE pool started on May 19, a large amount of Angle have immediately been locked:
Finally, this locker which lead Angle users to also lock SDT to get a boosted voting power and boosting rewards, lead to synergies between Angle and the other two protocols having a locker: Curve and Frax. Thanks to this veSDT meta-governance, Angleâs community has been able to push the interests of Angle across Curve, Frax, and Stake DAO. We can see this with the example of most recent gauge votes (for rewards starting May 19):
Curve Gauge vote: sdANGLE/ANGLE arrived in 3rd place with 13.4% of votes
Frax gauge: FRAX/agEUR uniswap pool arrived in 1st place with 83.8% of votes
Stake DAO gauge: Angle locker arrived in first place with 53% of votes
In a nutshell, Stake DAOâs Angle Liquid Locker enabled Angle to increase their locking rhythm and have a deflationary dynamic, and also generated synergies providing value to Angleâs community.
Just wanted to chime in to say I fully support having a diverse set of systems built on top of veBAL. The recent launches of sdANGLE and sdCRV are a good validation of the novel approach Stake DAO is taking here. I would like to see the contract address added to the proposal and a bit of time for anyone interested to review it - otherwise happy to offer my support for this proposal.
As far as bundling the whitelisting of sdBAL and the whitelisting of the gauge in the same proposal, I donât see a huge problem with it really. Ultimately forcing two votes is theatre for the most part, with the main value being the ability for the community to confirm the gauge matches the pool itâs supposed to. As long as the pool address and the gauge address are posted publicly here when theyâre created I think it should be fine.
Looks like a good way to lock BAL and increase the protocol TVL.
The Angle precedent is a good example of the synergy of these liquid lockers and the underlying protocol with more than 10% of the Angle TVL coming from this Liquid Locker in one week only.
Would the sdBAL/BAL pool be deployed on Balancer? Donât think weâd want to be having that deployed on Curve or another decentralised exchange, as thatâs effectively lost volume/fees & liquidity for Balancer going to a competing protocol.
(I canât see why weâd ever need voting influence at Curve, but perhaps Iâm missing something)
Just read it again, apologies for missing that. Had just referenced the diagram which made it look like a pool was being deployed on Curve with CRV rewards.
Hey, quick update here is the contract of the locker that would get whitelisted:
For the sdBAL/BPT liquidity pool and gauge, on the advice of the team we will wait for the new stable pool factory to create the pool. It will be 50/50 sdBAL/BPT.
sdBAL token address: 0xF24d8651578a55b0C119B9910759a351A3458895
We plan on moving this proposal to voting early next week, happy to answer any question before that!
