BIP 40 - Extend Core Contributor Funding from Treasury

Intro and Motivation

Since the adoption of BIP-35 in October 2022, the contributor runway has been augmented by $25k per month from Treasury. This funding has played a vital role in retaining and attracting key contributors to work on Beethoven X technology. In 2023, Treasury revenues have improved, leading to the months January and February (March) being cash flow positive for the Treasury despite the 25k outflows. This proposal now seeks to extend and slightly increase treasury funding for contributors to $35k per month from April to September.

BIP-35 significantly extended the contributor runway during 2022's challenging times. Throughout 2022, the contributors also diligently reduced costs, decreasing headcount from 12.5 to approx. 8.5 and implemented a 50% compensation cut across the board by July 2022. The treasury funding via BIP-35 enabled, in October of 2022, the increase of compensation from 50% to 75% of pre-cut levels and this reduction has been maintained ever since.

The protocol's foundation lies in state-of-the-art technology and a caring, kind community that is decentralized, transparent, and censorship resistant. Additional runway from the treasury has allowed contributors to remain committed to this vision. Q4 2022 witnessed the return of boosted pools, frontend improvements, and Q1 2023 saw significant progress with the Reliquary rollout and a substantial amount of collaboration with Balancer DAO and Balancer Labs. Marketing and design activities have also improved in quality and quantity through the unBEETables initiative and dedication and daily attention to design, content, and detail concerning educational efforts in relation to Beethoven X and Balancer technology..

Steps are also being taken to increase and diversify contributors’ revenue, funding, and compensation. In February, the contributors entered into a temporary three-month service provider agreement with Balancer Labs, generating $25k monthly revenue while further advancing Balancer and Beethoven X technology. Soon, Beethoven X will be making a proposal to Balancer DAO to serve as a service provider at the DAO level. If this proposal is approved by veBAL governance, then the service provider contract will see funds paid to the Beethoven X Treasury, followed by the transfer of funds earned through the service provider agreement to contributors. The aim is to achieve this collaboration with the Balancer DAO by the end of April 2023.

Q1's positive market developments have resulted in net positive earnings to the treasury from protocol fees. Protocol fee to treasury has surpassed the $25k outlay for the team (and for infrastructure costs) for the entirety of 2023.

Month	DAO Treasury Revenue from Protocols	Contributors & Team DAO Contribution	Infrastructure Costs Contribution	Net DAO Treasury Rev* from Protocol Fees
Jan	48’328	25’000	4873.55	18454.45
Feb	55’572	25’000	6221.74	24530.26
Mar	47’896	25’000	TBA (approx. $6,000)	16896.00

To provide further context, the Beethoven X Treasury as of April 6 held assets worth over $4,118,605 (6 April 2023, https://beethovenxio.medium.com/da-weekly-data-drop-1-c83c175ffdda), of which $2,518,536 are not BEETS or OP tokens.

This proposal, if adopted, will help to extend runway to 12+ months once again and continue to retain and attract contributors who are able to further develop and refine Beethoven X and Balancer technology while simultaneously educating the public about its benefits and promoting its use. Together with the Balancer DAO service provider arrangement (if adopted), these measures will reinforce a more transparent, decentralized, and censorship resistant revenue and contributor compensation arrangement and will allow the team to raise compensation above 75%.

For these reasons, this proposal seeks to increase funding to $35k per month for the next six months.

Thank you for your consideration.

Impact for the 6 months:

Team – Step 1: Contributors will receive an aggregate fixed $35k per month ($210k in total) in USDC from the Treasury. In addition, Step 2, assuming the Beethoven X-Balancer DAO service provider agreement is adopted: Revenue from the service provider agreement with Balancer paid into Treasury will also be used to fund the core contributor wallet.

Treasury – Treasury assumes a fixed monthly cost of $35k per month ($210k in total) in USDC. Assuming the Balancer DAO service provider agreement is adopted, Treasury will also receive funds from the service provider agreement with Balancer and then distribute those to the core contributor wallet upon request.

Tokenomics – No impact

Committees – No impact

Specification:

Each month, $35k USDC from Treasury and, upon request, any USDC received by Treasury for the anticipated service provider agreement with Balancer DAO will be sent to the wallet: 0x0EDfcc1b8D082Cd46d13Db694b849D7d8151C6D5. No additional work or modification to status quo operations is required.

Execution Plan:

Upon approval, the Treasury will send $35k in USDC to the team wallet monthly over six months. Treasury will periodically transfer funds from the anticipated Balancer DAO service provider agreement to the same wallet. These authorizations will take effect from April month-end, though the Balancer DAO payment authorizations are contingent upon the Beethoven X service provider agreement being approved by veBAL governance.