In making these changes, we will also need to adjust how our treasury is allocated. In making the following recommendations, I will use my post on a Treasury Management Framework as guidance.
For reference, I have made a spreadsheet that shows the treasury assets and the contract addresses:21.07.19 treasury reblance analysis - Google Drive. It also has a proposed breakdown of where we could allocate funds after the rebalance.
You can also browse the Treasury addresses here:
- Main Treasury: 0x9799...ea17 - Zapper.fi
- DPI/ETH LP: 0x205c...3d0f - Zapper.fi
- Sushiswap Incentivizer (Only the sushi and xsushi in the wallet and yield farming belong to the treasury. The staked assets belong to stakers in the incentivizer): 0xd67c...96d0 - Zapper.fi
- Ustonks Mint and LP (note that zapper does not show the minted position): 0x9789...b31d - Zapper.fi
- uGAS Mint and LP (Note that zapper does not show the minted position): 0xd25b...43d6 - Zapper.fi
- YAM Multisig: 0x744d...62d1 - Zapper.fi
- YAM DAO House: 0xd83d...ca4e - Zapper.fi
- YAM Timelock (UMA): 0x8b4f...3ec5 - Zapper.fi
- Polygon Multi-sig (nothing shows up here, but we should have ~$50K of YAM/MUST LP tokens staked : 0x5553...4f18 - Zapper.fi
- You can add all of these to your Zapper Address book and then visit them as much as you want!
Lets get the low hanging fruit out of the way. Our strategic assets don’t need to be moved or re-allocated at the moment:
- Index is currently delegated to @feddas for metagovernance voting.
- Sushi is wrapped as xSushi and may be used in the future for oSushi or as collateral in UMA.
- UMA isn’t being used productively currently. This is fine for now as it isn’t a large part of the treasury, but in the future we could consider voting in the DVM and other UMA governance processes, or minting yield dollars with it.
- GTC is not being actively used, but we should discuss delegating our voting power to someone.
Our current largest farming postion is our Uniswap V2 DPI/ETH LP with ~$1.5M each of ETH and DPI. Up until the 13th of August 2021, this was earning Index tokens, but those rewards have ended and are they transitioning to V3 (at least in the short term). Going forward it is unclear whether IndexCoop will continue incentivizing DPI liquidity. Read more about this on the IndexCoop forums here. We have a lot of DPI, so we will need to do something with it. We will come back to this.
In my opinion, the most EV+ thing that we can do with most of our assets is bootstrap our UMA synths. Right now we have about $725,000 of USDC in uStonks and a similar amount of ETH in uGAS. At current rates these are making ~30% APR from farming and an additional +/- 3% that goes directly to the treasury.
I propose that we double both the ETH and USD that we are allocating to UMA bootstrapping. At current prices this would be about ~$1.4M of each to minting and LPing synths. Until the new Defi Tools Synths are launched, this would entail splitting the ETH liquidity between uGAS and uPUNKs and putting the USD liquidity into uStonks.
We do not plan on continuing uStonks after this next expiry, so we would need to have DeFi Tools ready by Oct. 1 and the uStonks USD would be allocated toward the 2 USD denominated synths we are creating (sushi fees and IL). The ETH would be split between uGAS, 2xDPI-synth, and the next version of uPunks.
We also have ~$80k worth of ETH and ~$250K worth of stables earmarked for our new fuse pool.
We then need to decide on how much liquidity we want to put toward YDS or LPing DPI/ETH in V3. In the spreadsheet above, I have proposed providing $400K of ETH and DPI to LP in V3, and this leaves about $1.8M for Yam DAO Set. There is a fair amount of wiggle room here and we could reduce the amounts in the YDS and put those funds toward more UMA synths, or DPI/ETH, or something else entirely.
I will leave it there and see what everyone thinks. If someone wants the see this spreadsheet to play around with DM me here or on discord and I can get you a copy.