KIP-11 Co-invest ROOK in Bancor ROOK-BNT Pool

KIP-11: Co-invest ROOK in Bancor ROOK-BNT Pool

Proposal

This proposal seeks to co-invest $1.6M in KeeperDAO Treasury ROOK (approx. 6400 ROOK) by staking it in the ROOK-BNT pool on Bancor. This proposal is contingent on Bancor approving an their matching governance proposal to increase in the co-investment limit from 1.3M BNT to 2.1M BNT and approve LM rewards for the ROOK-BNT pool.

Background

Bancor, a long standing integration partner and home for staking ROOK, has offered to increase their co-investment in the ROOK-BNT pool on their platform. Currently, they have already invested 1.3M BNT into the pool, and are offering to add additional BNT to bring the total to 2.1M BNT. Bancor is leaving additional room in the pool for other ROOK holders to join the pool.

There is currently ~1.3M BNT and ~22K ROOK tokens in the BNT-ROOK pool. This has resulted in a pool that has roughly ~11.2M in liquidity.
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This is favorable because:

  • More liquidity in this pool should drive more volume through it, resulting in additional fees (APY) for current ROOK stakers.

  • This makes unproductive ROOK in the treasury generate yield.

  • Deepens a relationship with a good partner by creating a win-win.

Specification

Deposit 6400 ROOK from strategic reserves into the ROOK-BNT pool on Bancor.


2 Likes

Hello KeeperDAO community,

Just wanted to link the sister proposal in our DAO for the co-investment increase:

plus mention that we have had other projects also stake a portion of their treasuries:

  1. UMA, roughly ~$500K for initial deposit (etherscan)
  2. Harvest.finance, roughly ~$733K for initial deposit (etherscan) but now up to ~$2.7m after subsequent $FARM deposits
  3. Barnbridge, roughly ~$1.3m for initial deposit (etherscan) but now up to ~3m after subsequent $BOND deposits

Happy to answer any questions from the community. Thanks!

2 Likes

Would this still make sense in the context of the goal of setting up a Curve pool after the CVX proposal once Curve v2 goes permissionless? I think we should pick one or the other, unless the view is to use BNT as a stopgap for a few months?

I am against this, I would prefer to utilize the entire market to our buyback to increase the amount of rook that can be burned for each buyback, I see this proposal benefiting bancor drastically more than it benefits KD

in my opinion, we have more than enough rook to do both, and i do see that as a stopgap until there is some form of our own staking available.

the entire proposal or just the buyback portion? I would encourage everyone to vote so we can see a better sense of the response.

1 Like

I support both aspects of the plan.

  • Allows the treasury to earn IL protected fees on otherwise unproductive ROOK

  • In addition earning LM rewards for leveraging the pool we are seeding for buyback makes sense. Every buyback will also earn us fees as LPs in the pool

  • Stacking BNT from LM rewards will also earn us governance power in Bancor

2 Likes

Just a quick follow-up on my last append. Note that only Harvest has implemented a buyback through the BNT-FARM pool in addition to staking a portion of their treasury on Bancor (we have had other projects that have done a buyback without staking their treasuries, eRSDL more recently). The other projects (UMA and Barnbridge) are just staking their treasuries without any buybacks and the Bancor DAO gladly supports it.

The Bancor DAO will more than likely support increasing the co-investment for KeeperDAO even if you decide to not perform any buybacks at all. That’s assuming that the KeeperDAO community is in favor of staking a portion of their treasury. Note that our mission is ultimately to enable anyone to create a viable and liquid token for their community or project and we will stand by that.

1 Like

One other thought that I had since you mentioned that KeeperDAO will support native staking in the future. Bancor V3 will support the idea of what’s called superfluid collateral which is a concept that would allow us to use a portion of the liquidity in our pools to be staked natively on protocols that support it. This means that as a token holder, you no longer have to choose between earning fees from providing liquidity and staking natively. In fact, you will be able to do both while staking your token single-sided (and getting IL protection) on the Bancor protocol.

Mark, who is our researcher lead revealed this at SmartCon in the context of Chainlink staking (when that goes live) but the same concept will also be applicable to other projects with native staking:

1 Like

This is an exciting development and a real advantage. Is there a visibility of when that will be available?

Yes, this was recently shared in the bancorian weekly:

We are happy to announce that on November 28th we will be sharing with the community the complete feature set of Bancor V3 Phase 1. On this date, we are going to start discussing with the community V3 phase 1 in a much more open manner and we are going to tell you exactly what V3 phase 1 does, how the pools and protocol are changing, etc. A lot of the work on our side will be completed by this point in time but we anticipate some minor loose ends (audits) that might take some extra days to complete. By the end of November, we should be more confident in a target launch date.

The full feature set for Bancor V3 phase 1 will be shared on the community call on 11/28. It has been revealed to us that V3 will have three phases and it is not yet known whether native staking will be supported at launch as part of phase 1.

1 Like

That’s good news, looking forward to hearing more on that. Have lost a bit of track of Bancor’s progress lately, this will motivate me to reengage.

FYI, the proposal to increase the co-investment on the rook pool is live on snapshot on our end:

https://snapshot.org/#/bancornetwork.eth/proposal/0x24c6cd42ec45e40f8d442d8464f9170b839268a5a5ddf23fadf9069c0f9c3e4e

1 Like

Just to note here, the proposal went up to snapshot this week again (we had low participation 2 weeks ago) and it was passed successfully by the Bancor DAO:

40% quorum and 66.7% supermajority are our requirements.

1 Like

Edited this proposal to reflect only depositing ROOK in the pool, not proceeding forward with buy backs via Bancor.

1 Like

Thanks! I agree and I think that depositing a portion of treasury funds is a good first step :handshake:.

Voting is currently live on snapshot:

https://snapshot.org/#/rook.eth/proposal/0x621d2c8a2abf634559a6b7b360dd131c6796fe5a00aad06a14c20e19cabcbf11