Proposal to Relabel Multichain Warchest as Ecosystem Growth

TLDR

We propose to relabel the current Multichain Warchest allocation as Ecosystem Growth to expand its scope. This allows us to provide incentives for PancakeSwap’s upcoming products and initiatives like PancakeSwap v4, for which we propose to establish a $250,000 Hooks Grant Program and a 0.05 CAKE per block emission program.

Why This Matters:

• The current Multichain Warchest, which receives ~0.2 CAKE per block, is solely meant to support PancakeSwap’s efforts in expanding to new chains.
• While we will continue to do so, there are planned products in the pipeline like PancakeSwap v4 that do not belong to this category, but would still require incentives to kick-start adoption.
• By relabelling it as Ecosystem Growth, incentivizing PancakeSwap v4 becomes possible as it can contribute meaningfully to the protocol’s growth.

Summary of Proposed Changes

• Relabel the current Multichain Warchest allocation as Ecosystem Growth, allowing the use of its accrued funds and ongoing emissions to grow PancakeSwap’s ecosystem. This includes but is not limited to new products and initiatives like PancakeSwap v4 and expansion to new chains.
• Just like with the Multichain Warchest, to allow the Kitchen to have flexibility in the implementation and use of funds within the Ecosystem Growth allocation. We will provide regular reports for the use of funds as detailed below.

Transparency and Accountability

• When managing the Multichain Warchest, we only used what was necessary, currently still leaving ~0.2 CAKE per block unused out of the originally approved 1.25 CAKE per block (which was later reduced by 0.4 CAKE per block to 0.85 CAKE per block).
• With our efficient utilization of the Multichain Warchest emissions, we have maintained deflationary CAKE for 1 year while expanding strongly across 8 other chains:

as of 5 November 2024

Chain	DEX Rank (by 7-day Volume)	7-day Volume	TVL
BNB Chain	1st	$4b	$1.5B
Arbitrum	3rd	$443M	$16M
Base	3rd	$350M	$10M
Ethereum	7th	$151M	$72M
Linea	3rd	$17M	$7M
ZKsync	2nd	$13M	$3M
Aptos	3rd	$11M	$29M
Polygon zkEVM	3rd	$619k	$347k
opBNB	1st	$396K	$6M

• We will regularly report on the Ecosystem Growth allocation on the PancakeSwap forum, detailing the use of funds and its outcomes. This allows us to retain flexibility in the use of funds, while still providing transparency to the community.
• The Kitchen welcomes community-led initiatives and feedback. Please make suggestions and proposals on the PancakeSwap forum - we will review and implement them if deemed suitable.

PancakeSwap v4

For the first use of the Ecosystem Growth funds, we propose to earmark $250,000 and 0.05 CAKE per block to support the upcoming PancakeSwap v4 deployment.

Grant Program

• Hooks are add-ons that can be tagged to liquidity pools to enhance their functionality. We need to leverage the broader developer ecosystem to help design innovative and effective hooks.
• As such, we propose to set up a Hooks Grant Program with a total prize pool of $250,000 to incentivize developers to build PancakeSwap v4 hooks. The Kitchen will create Requests for Proposals for specific Hook categories and invite developers to apply. We will also have an open category where we fund effective and useful hook ideas.
• This $250,000 will be sourced from funds that have already accrued to the Multichain Warchest allocation, hence no new emission is needed to fund this program. Any unused funds will remain in the Ecosystem Growth allocation.

Emission Program

• Separately, we ask for 0.05 CAKE per block for an ongoing Emissions Program to reward the most profitable hooks on PancakeSwap v4. This will come from the existing Multichain Warchest emissions (~0.2 CAKE per block), so there will be no net new emissions.
• Hook developers may face difficulty in attracting liquidity despite having built a great hook. Hence, we want to incentivize hooks that have displayed good market traction to attract more liquidity towards them.
• Hooks will need to regularly generate high revenue to continually receive emissions, which will lead to more CAKE burn.
• The Kitchen will decide the criteria and incentive rates for qualifying hooks, and will adjust as necessary. Unused emission will remain in the Ecosystem Growth allocation. The emissions will only be utilized after PancakeSwap v4 is live.

Conclusion

If the community supports this proposal, we will relabel the Multichain Warchest allocation as Ecosystem Growth, and allocate the funds and emissions wisely towards products and initiatives that promote PancakeSwap’s long-term growth.