Using Treasury Assets for Optimism Incentives

Motivation

As many of you are aware we recently experienced some unexpected behavior in the boosted pools when UST and DEI depegged. This combined with the recent bug disclosures has altered the development priorities of Balancer Labs for the next month or two. We initially planned to launch on Optimism with veBAL gauges and voting but we should consider an alternative approach that can get us online much quicker.

We propose BeethovenX joining Balancer in allocating $250k towards Optimism incentives through traditional liquidity mining over a two month period. This would be in addition to the “up to 3M BEETS” already authorized for use in bribing veBAL. Given the record low BEETS price of late we suggest using 250k USDC from the treasury to use as BeethovenX’s half of the incentives. Balancer would match with 31,250 BAL ($250k at $8 BAL). Once veBAL integration is completed any unused funds would be returned to the treasury and bribing would begin as originally planned. The 250K USDC would either be used directly as incentive or be used to market purchase BEETS to be used as incentives, determined by the outcome of the vote.

This arrangement allows us to move quickly with the launch instead of waiting an unknown amount of time for the veBAL integration to be completed. It does carry a substantial cost which must be weighed against the value of launching as soon as possible. The liquidity committee would have discretion over where the incentives are allocated and will coordinate with their counterparts at Balancer.

If this vote fails to pass or the corresponding Balancer vote fails to pass, neither side will move forward with providing incentives.

Options

1. Allocate 250K USDC from treasury to market buy BEETS and used as farming incentives;
2. Allocate 250K USDC from treasury to be used directly as farming incentives;
3. Do not use treasury to provide farming incentives.

Note that option 3 will win only if it has more votes than options 1 and 2 combined.