SDGP- 48: StakeDAO Association Grant Request H1-2025

Tube · 16 January 2025 10:34

Preamble

This proposal serves as a formal request for a half-yearly grant (“Grant Proposal”) from Stake DAO for the period of H1-2025 (ending on June 30th) in continuation and recognition of the governance proposal (SDGP#32) and of the previous Grant proposal (SDGP#39) previously adopted by Stake DAO.

The StakeDAO Association ("Association”), established as a pivotal entity within the Stake DAO ecosystem and based in Zug, Switzerland, aims to further support the development and growth of Stake DAO through specified services aligned with the Stake DAO’s strategic objectives.

Review of previous grant

For H2-24, StakeDAO Association was awarded a USDC 876,984 grant for the purpose of achieving certain milestones. Here is a recap of the outcome for those milestones:

M1 (October 2024): Roll out of Votemarket v2 (budget: $150,000) => successful even though there was a 2-week delay
M2 (November 2024): New reward architecture (budget: $150,000) => unsuccessful, development of that task only started in December and audit (already partially paid) didn’t happen yet
M3 (December 2024): Roll out of new tokenomics (required budget: $100,000) => unsuccessful, development of that task didn’t start yet.
M4 (December 2024): Maintain a high level of uptime of Stake DAO’s product and user interface (>95%) (required budget: c.$300,000) => successful
M5 (December 2024): Ensure steady business development efforts to bring a stable flow of vote incentives to Votemarket and increase Liquid Lockers’ TVL. Target: $175m TVL in Liquid Lockers and their strategies, and $2m of monthly deposited vote incentives on Votemarket (required budget: c.$200,000) => successful: both targets have been hit and exceeded in December 2024

Overall the Association reached all its targets but two, budgeted together $250,000. Those targets were missed due to a combination of the loss of a senior smart contract developer in the contributors hired by the Association, and an optimistic sizing of the VMv2 task (which took more time than expected, and cost actually c.$187,000).

Furthermore, the work of contributors hired by the Association enabled the DAO to achieve a positive outcome throughout the year, with a net profit of $524k (in real prices, eliminating the impact of an increase in value of treasury assets), split between $187k distributed to veSDT and $338k going to the treasury (and this doesn’t include the proceeds of boost selling or usage by veSDT holders).

Overall, the Association didn’t spend its entire budget over the period, and out of the USDC 876,984 awarded, a bit more than 250k remain.

Grant Award

Amount Granted: The Association hereby requests a grant amount of USDC 750,000 ("Grant Amount ”) designated for the execution of the milestones further described below ("Grant Purpose”). To determine the Grant Amount, the financial reports of the previous grant received have been used (Annex 2), as well as the forecast for future exceptional costs that are to be expected.

This amount will be split as follows:

Moreover, to achieve its goals, the Association targets to contract with at least one additional senior smart contract developer.

Milestones:

The Grant Amount shall be paid to the Association in nine (9) instalments as described in Annex 1 ("Annex 1”) to perform the following milestones ("Milestones”):

M1 (March 2025): Roll out of “Staking v2”, called new reward infrastructure in the previous grant (required budget: $110,000).
M2 (April 2025): Roll out of a curator infrastructure (required budget: $30,000, assuming we use an existing external solution).
M3 (June 2025): Roll out of new tokenomics (required budget: $75,000).
M4 (February 2025): Roll out the Zerolend locker (required budget: $20,000).
M5 (February 2025): Roll out the new Spectra locker (required budget: $20,000).
M6 (June 2025): Roll out additional lockers and strategies on an opportunistic basis (required budget: $115,000)
M7 (May 2025): Roll out VMv2 for new markets (required budget: $20,000).
M8 (June 2025): Maintain a high level of uptime of Stake DAO’s product and user interface (>95%), including community management and legal watch (required budget: $250,000).
M9 (June 2025): Ensure steady business development efforts with a focus on new strategies with the new staking infrastructure, targeting at least $150m in Stake DAO strategies (300% half-yearly growth), and 2 active curators, while maintaining a steady flow of rewards going through VMv2 (required budget: $160,000)

A detailed explanation of those milestones will be given during the StakeDAO Association community call.

The Grant Amount shall be distributed in six (6) monthly payments to the Association per mutually agreeable arrangements. The initial payment schedule suggests a USDC 125,000 monthly payment, performed within seven (7) days after the end of each month.

Association Autonomy

The Grant Proposal does not create a principal or agent, employer or employee partnership, or joint venture between the Association and the Stake DAO.

The Association is free to decide upon the way to carry out the execution or fulfillment of the Milestones set forth above. The Association retains its independence in achieving these Milestones, leveraging either internal capabilities and resources or engaging suitable third parties as auxiliary persons.

Purpose and Limitation of Use

As described in the Milestones, the Grant Amount shall fund research and development (R&D) initiatives aimed at enhancing Stake DAO’s decentralized finance (DeFi) products and services, encompassing new product development, user experience enhancements, security auditing, and risk management, as well as the operation and maintenance of the existing product when needed.

The Association understands and acknowledges that the Grant Amount shall be exclusively used to execute the Milestones defined within the Grant Proposal.

Internal regulations shall be in place to address any misuse of the funds, ensuring that all activities funded by the Grant Amount shall directly contribute to the specified project and the broader Stake DAO ecosystem.

IP Ownership and Source Code Publication and Licensing

The Association shall become the sole owner of any intellectual property rights in and to any kind of work products that have been or will be created in the context of this grant.

The Association acknowledges its role in holding and managing intellectual property rights within the Stake DAO ecosystem.

All backend and frontend code developed as part of this grant, including smart contracts and web interfaces, will be published on a designated public GitHub repository. The software will be licensed under an open-source license (such as the BSD License, the MIT License, the Apache License Version 2.0, or any other license approved by Stake DAO), promoting transparency and accessibility.

Reporting Obligation

In line with the commitment to transparency and accountability, the Association will include details regarding the Grant Amount and its utilization in its monthly activity reports. This report will be prepared in accordance with the governance proposal’s requirements, ensuring the Stake DAO community is fully informed of the progress and outcomes of the funded initiatives.

Conclusion

This proposal, structured in accordance with both the strategic goals of Stake DAO and the legal guidelines provided, represents a comprehensive plan for utilizing the requested grant to achieve significant advancements within the Stake DAO ecosystem. The Association commits to fulfilling the outlined objectives with the highest standards of transparency, efficiency, and accountability.

Proposal specifications:

Admin: veSDT holders

Community feedback: 3 days minimum

Voting Duration: 7 days

Footnotes:

Any gas fees accumulated may be allocated by the Association or through carefully selected subcontractors, to cover the operational gas expenses and support the financial sustainability of future initiatives. This approach aims to ensure the longevity and efficiency of our ecosystem, prioritizing the community’s interests and promoting a cycle of reinvestment into our shared infrastructure.

Annex 1: Association Budget and Grant Payment Schedule

Annex 2: 2024 Grant reporting