- Grant for a team of 2 devs to do the following:
- Build a detailed analytics dashboard for Frax that tracks protocol owned assets, earnings, usage metrics, and others, across all chains Frax is deployed
- Gather information and propose improvements to how the protocol allocates its treasury in order to increase profit and maximize Frax use cases
- Propose new gauge pools and improvements to its allocation in order to maximize growth of Frax usage
- Build an information site to display the partnerships Frax has made, how much has been spent on each, DAO-swapped FXS in case it happened and how they are using their FXS, etc.
- Have a more active conversation on Governance Discussion with protocols that seek partnerships with Frax and provide reports on benefits and risks
- Seek new partnerships and recommend possible investments in protocols that would help Frax expansion and use cases
Treasury and protocol owned value management are fundamental for a DAO to work. First step of how to properly do this is to have an accurate account of it, currently Frax has two sources of this: the Dune dashboard and the AMOs dashboard. The Dune dashboard has several problems, it is not useful for multi-chain information, has little interactivity, and available graphs are limited, in its favor we can say that is displays information over time. The AMOs dashboard improves in multi-chain information, but does not provide a good understanding of the data over time. Besides, there is a lot of additional information that should be measured, such as how much of the circulating Frax is owned by the protocol, what are the assets and liquidity deployed on DEXes, what are the volumes on those pools, how much the deployed funds are making and have made over time, what is the Frax volume, how much of the Frax is locked in bridges, and more.
For these reasons, and others, such as an absolute transparency and ease of understanding, we think that more efforts on tracking the protocol holdings should be made and we request for a grant to build an in-depth dashboard for this, along with additional information such as Frax usage.
Currently the protocol has liquidity and assets supplied across several markets, although it is questionable how each particular pool contributes to the protocol. What we would like to seek is to maximize the profits and use cases each deployment provides for Frax, but in a lot of cases it is really negligible. For example, if we look at the Uniswap V3 pools:
Of these pools, the protocol controls the 9m in the USDT pool, the 5m in the LUSD pool, the 4.75m in the sUSD pool, the 2.34m in the RAI pool and the 1.5m in the UST pool. As we can see the volume on these pools is very low, which makes us wonder if and how could we make a better use of these funds.
One of the tasks of this grant will be to analyze and seek to improve how treasury funds are allocated.
As we also see in the above picture of Uni V3 pools, around 260m are deposited in the USDC and DAI pools, but they present very low volume, as a comparison, the 1bps DAI/USDC has 234m TVL with 330m 7-day volume, and the 1bps USDC/USDT has 186m TVL and 1b 7-day volume. Although it may not be a completely on par comparison, the objective of FXS should be to compensate for users that are taking a risk (like the FXS/FRAX pool) or provide a usage of Frax (like the StakeDAO ETH-Put Strategy). Neither is the case for the deposits on the FRAX/USDC and DAI/FRAX pools, based on the low volume of those pools, and the fact that the current risk of Frax loosing it’s peg its 0.
For this reason, we think that seeking for ways to improve the gauge FXS emissions in order to increase the Frax usage is very important, and will be one of the objectives of this grant.
Frax has invested in several protocols, such as TempleDAO, OlympusDAO, OndoFinance, and performed treasury swaps with some others like LOBIS or Tokemak. We propose to build and interface to show the status of this partnerships, such as how much the protocol has invested, how it is being used, and how the other protocols are using their FXS if they have.
Several protocols have reached out to Frax in order to propose partnerships, but we have seen in some cases that they have received little attention, such as the IdleDAO team. We aim to build better conversations with some of the protocols and provide reports of possible benefits and risks for the Frax community in order to keep them informed, not just taking someone words for it, and make better decissions. Also, we propose keep an eye out for possible new partnerships or investments that could be beneficial for Frax. (Important to note that to make a good work in this, time is of essence, for this reason, the amount of protocols to be reviewed are limited at 3 or 4 per month, left at the devs discretion)
We think this is a very ambitious proposal, for this reason reason we request funds for 2 devs, Seba will be the main face behind the proposal and has a pre-agreement with an additional dev. This proposal is intended to provide funds for at least two months. Work on the Frax Analytics Dashboard will begin immediately and we expect to have a public, possibly incomplete, version in February. Points 2,3,5 and 6 will also begin immediately and concurrently. Point 4 will be less of a priority and work on it will be based on devs criterion, time availability and, in case of a high Frax community demand, may be prioritized.
Based on the size of this proposal and how much it can contribute to Frax, we think that a grant of $4k in Frax and $4k in FXS, the latter vested for 6 months as standard, per dev per month, is a fair compensation (although we understand possible concerns about this and are open to a negotiation). Also, based on my current experience with the Dune dashboard, I think it would be fair to value each FXS at the minimum between the 14-day and 30-day average at the time of payment, due to high price variance. Finally, payment will be done in three steps, an initial payment of $4k Frax at the beginning of the work for each dev, after the first month $4k Frax + $4k in FXS, and after the 2 months the remaining $4k in FXS for each dev. After the 2 months, the continuation of the grant and agreement will be open to renegotiation.
I hope you guys can also agree that this is an important work for Frax, beginning to work on our data can be very helpfup (as MakerDAO is), and please share any questions, concerns, additions, etc. you have about this proposal.
Seba and Aidan