SDIP#13: Token Swap: Stake DAO x APWine

Archives Approved SDIPs
#1

Summary

Expand the partnership between APWine DAO and Stake DAO by performing a 500K$ treasury swap of SDT for APW which will be used to increase the synergies between both protocols

Context:

Apwine is a yield tokenizing protocol allowing users to long or short their yield, which can create arbitrage opportunities. The protocol works with two tokens : PT (Principal token) and FYT (Future Yield Token). The PT represents the underlying token locked for a 90 days period and the FYT represents the yield on the period, which can be sold in advance.

The governance token of the protocol is APW, which works with a ve-model,and is used to incentivize the liquidity pools and to vote on the governance proposals. In the coming weeks, the DAO will vote to enable gauges for APW rewards.

Several Stake DAO pools have already been added to the winelisting events, and voted to be eligible to APW rewards:

  • Winelisting 1 - Mainnet: xSDT
    Snapshot vote link
  • Winelisting 2 - Mainnet: sdFRAX3CRV-f
    Snapshot vote link
  • Winelisting 2 - Polygon: sdam3CRV
    Snapshot vote link

By expanding the partnership between both DAOs with a treasury swap, we can make sure that each project will be able to participate actively in the other’s governance.

Rationale:
This proposal will have 3 different topics:

Token swap:
We’d like to propose a token swap of 500K$ worth between both DAOs. The proposed token swap conditions are:

  • Split the swap with 50K$ tranches during 10 weeks
  • The swap price will be determined with a 3 Day TWAP before each swap
  • Both DAOs should lock at least the 1st tranche, and can wait the liquid lockers for the next ones
  • The tokens received will be used for gauge voting ang governance purposes

APW Liquid locker and strategy creation:
Stake DAO propose to create a liquid locker for APWine, so users could lock their APW on a liquid locker and receive sdAPW, enjoying all the voting rights of the veAPW, the Liquid locker yield, while keeping a liquid position.

Apwine DAO will be able to lock their SDT to vote on sdAPW Liquid locker and sdAPW/APW strategy gauges to receive SDT rewards.

Stake DAO treasury allocation:
Considering that $APW rewards will now be allocated with gauges, another good option could be to increase SD $APW holdings by allocating part of the Stake DAO treasury on APWine pools, starting with FRAX3CRV-f and sdam3CRV PT/Underlying pools.

The treasury currently holds around 2M$ in stablecoins including 300K$ in FRAX3CRV and 100K$ in 3CRV. I suggest allocating 15% of the total stablecoins (200K$ to the PT/FRAX3CRV pool and 100K$ to the PT/sdam3CRV pool).

Stake DAO will then be able to vote on FRAX3CRV and sdam3CRV gauges to boost the rewards for the treasury.

Benefits for Stake DAO:

  • Create a long term position on APW
  • Ability to vote on APW gauges with veAPW/sdAPW
  • Increase the governance participation and DAO revenues by farming APW rewards
  • sdTokens can be integrated as IBTs on APWine once live
  • Increase the visibility of both projects with cross marketing

Benefits for Apwine DAO:

  • Create a long term position on SDT
  • Creation of a Liquid Locker and a sdAPW/APW strategy both eligible for gauges rewards by locking SDT and voting with veSDT
  • Once live, APW holders will be able to boost their voting power on sdAPW with their veSDT
  • Once live, new IBTs that can be integrated on the protocol (sdTokens)
  • Increase the visibility of both projects with cross marketing
  • Increase of the TVL and revenues with Stake DAO treasury deposits (if accepted by the SD vote)

Means:
Swap the tokens every week over 2.5 months

Technical implementation:

  • The swap price will be determined with a 3 Day TWAP before each swap
  • Create a liquid locker and a strategy for the veAPW

Voting options:

  • Yes for the DAO swap only
  • Yes for the DAO swap + the liquid locker
  • Yes for the DAO swap + the liquid locker + Treasury allocation
  • No, against the DAO swap
  • Abstain
Should we implement this proposal ?
  • Yes, for the Token swap only
  • Yes, for the Token swap + The liquid locker
  • Yes, for the Token swap + The liquid locker + Treasury allocation
  • No, against the Token swap
  • Abstain

0 voters

3 Likes
#2

been following this partnership since the start; glad to see it being further cemented on the treasury level

1 Like
#3

I support this kind of partnerships, strengthening ecosystem around SD.

Does the Stake DAO treasury allocation part consists on providing liquidity on both pools?
What was usually done with the treasury stable coins? What are the considered alternatives?
What about owning our liquidity ? (SDT/ETH)

1 Like
#4

Hey @dwidoo, thanks for your feedback and questions:

Yes the idea would be to deposit on both FRAX3CRV-f (mainnet) and sdam3CRV (polygon) PT/Underlying pools so it’s two stable pools.
The stable coins on the treasury are on Curve and Frax pools or not allocated yet, so farming some APW could diversify and increase the treasury rewards and increase our voting power.

We already own part of our liquidity, which is farming CRV too, and i guess the goal is to increase it over time.

Let me know if you have others questions :slight_smile:

1 Like
#5

Really enjoy the relationship we have with APWine, which is a great project.
Would probably start with the token swap spread over 10 weeks.
Also, I would see APWine as a good candidate to go through the permissionless process for liquid lockers (so probably as a second step).
As for the treasury allocation, we could probably allocate a fraction there at some point indeed. It’s important we keep good liquidity on our treasury though.

1 Like
#6

The SDIP#13 vote is over: Snapshot