Core Proposal -- AGIP #10: Co-fund partnership between AavegotchiDAO, Pixelcraft Studios, and DinoSwap

Author: Jesse | gldnXross#6482 Gotchi ID: 4563 Discourse Thread: https://dao.aavegotchi.com/t/ghst-liquidity-rewards-on-new-launch-pixelcraft-dao-collaboration/1804

Problem being addressed:

Some community members are worried about the waning liquidity of GHST on Quickswap and their gradually decreasing LP rewards.

View the detailed proposal at the Discourse Thread linked above.

Solution:

Rather than simply allocating more liquidity to the pool, we are considering partnering with a soon to launch liquidity aggregator called DinoSwap. The terms include a total of 200k USD worth of GHST tokens to be allocated to their incentivized “extinction pools”, the details of which are fleshed out below.

Update:

Since this proposal's original SigProp, we have seen DinoSwap publish their first blog post, activate their Twitter (@dinoswapHQ), launch their Telegram channels (https://t.me/DinoSwapOfficial and announcements channel https://t.me/DinoSwapAnn) and be copied by fake scammer knockoffs.

NOTE: No DinoSwap tokens have been minted yet!

We are expecting their team to publish more news throughout this week and have a verbal agreement for an AMA to take place before the conclusion of this CoreProp. It is completely reasonable to withhold casting any vote on this proposal before that AMA takes place. Once we have a date and time confirmed, its details will be plastered all over our various socials.

Proposal:

I am proposing that Pixelcraft Studios and AavegotchiDAO each contribute 100k USD worth of GHST to partner with DinoSwap during their launch window. For the $200,000 of GHST tokens provided, DinoSwap will be providing approximately $2,000,000 in DINO rewards over a 3 month period to stkGHST-WETH LPs on QuickSwap.

This particular arrangement offers an asymmetric risk/reward scenario: consider, if the DAO foregoes this and instead puts up 100K worth of GHST as just normal liquidity, then we've got 100K more liquidity in an already existing pair's pool. Not terrible, but not great either.

The opportunity here is that this 100K may lead to much more than 100K in liquidity for a newly bootstrapped GHST-WETH pair. Maybe 1M, maybe 10M, or maybe something much lower. It's hard to say, but the potential is there, and that's why this proposition is worth the DAO's consideration.

After over a month of vetting by Pixelcraft, we believe the upside (big increase in liquidity, potentially valuable DINO rewards for LPs) significantly outweighs the downside (spending 100K GHST for the DAO, 100K for Pixelcraft).

A quick check of https://aavegotchi.com/treasury shows that DAO treasury currently sits near 870k DAI and 515k GHST.

PROS:

• Potentially significant increases for GHST liquidity demand.
• Wider exposure of GHST to the fast growing Polygon user base and users of DinoSwap.
• Bootstrapping a new, third major liquidity pair in GHST-WETH.

CONS:

• DinoSwap is a new, untested (but audited by Certik) product that may not live up to the hype.
• The $200K in GHST provided is going into an “extinction pool”, which means it will be consumed by yield farmers participating in liquidity mining on Quickswap, in exchange for the new DINO token (whose value is unknown).
• The assorted risks of the unknown and opportunity cost.

Note, Pixelcraft would also integrate FRENS rewards for the GHST-WETH liquidity providers, in order to maximize the LPs participation in the Aavegotchi ecosystem.

The exact percentage of FRENS rewards can be discussed, but given WETH’s volatility it would likely be greater than our USDC rewards but less than the QUICK pair.

In summary, this proposal has:

• Pixelcraft Studios contributing 100k USD worth of GHST (taken from our monthly 50K tap allocation) while
• AavegotchiDAO treasury matches with another 100k USD worth of GHST.

BEFORE voting, I highly suggest reading/joining the Discourse conversation above and joining our soon to be confirmed AMA if at all possible. It will take place in Discord.

The length of this CoreProp is set to 7 days (Concluding Sunday, June 20 at 2pm UTC).