TIP-14 - DeFi Pulse Partnership

Authors

@Etienne, with the help of @eqparenthesis and @lewi.

Summary

This proposal aims to onboard the Defi Pulse team as a strategic partner to drive the growth of Empty Set across its hundreds of partners in the DeFi space. By leveraging the Defi Pulse network, we believe that the pace of adoption for ESD can increase at a much faster rate. Value Proposition

The Defi Pulse) team is deeply rooted in the DeFi ecosystem. It has one of the largest networks of curated partners in the space and a proven track record of developing innovative metrics and products. Among others, DeFi Pulse invented the ‘Total Value Locked (TVL) Metric’ and created the ‘Defi Pulse Index’, which, with more than $200M assets under management, is the leading DeFi index.

By partnering with Defi Pulse, the Empty Set DAO will leverage the network of one of the most recognized and trusted actors in the space. This partnership will enhance the adoption of our protocol from scratch, increasing the issuance of ESD, our north star metric.

Funding

Initial allocation

As a strategic partner, the Defi Pulse team will be granted 16,500,000 ESDS as an initial allocation to start the program and become a stakeholder in the Empty Set DAO. These tokens will vest linearly for 2 years, in a revocable contract.

Defi Pulse treasury

The Empty Set DAO will bootstrap a treasury managed by the Defi Pulse business development team, which will be used to incentivize the adoption of ESD by a variety of protocols.The initial grant will be 5,000,000 ESDS. To reduce friction and increase efficiency, the Defi Pulse team will be able to provide grants to projects that are being onboarded, in an autonomous manner. Each time a protocol is successfully on-boarded by the business development team, Defi Pulse will earn $50K worth of ESDS as a success fee, directly paid from its treasury. Once capital is allocated, the Defi Pulse team will formalize a TIP to replenish its treasury through a vote.

Protocol growth program

To incentivize the adoption of ESD in the most relevant protocols, the Defi Pulse team will earn rewards for reaching TVL based milestones in each protocol that is on-boarded. At the end of each month, if a protocol has reached a TVL milestone, the DAO will reward the Defi Pulse team accordingly, with a 1% cut of that TVL. This reward will be capped to avoid large dilutions for ESDS holders, and will be vested linearly in a 2 years non revocable contract, in the same time schedule as the initial allocation (non restarting).

Below we can see the proposal for TVL milestones and rewards for protocols on-boarded by the Defi Pulse team.

Each reward is capped to avoid large dilutions according to the following formula, where:

Protocol ESDS valuation = (ESD TVL in protocol / Total ESD TVL) * FDV

Max Milestone reward per protocol = 1% * Protocol ESDS valuation

Wallets

Defi Pulse will be using two distinct multisigs wallets for transparency purposes:

Wallet n1 - Initial allocation & rewards:

0x1008DA881d464B090b0970edbeaB7a91410cCF1B

Wallet n2 - Defi Pulse treasury:

0x866613c804Be33e9D7899a41D4EfE880c0de1FaD

Performance tracking

To track the performance of the Defi Pulse business development team, the Empty Set DAO, or any dedicated team, will be in charge of creating a dashboard with a list of all protocols that are on-boarded by Defi Pulse and their respective ESD TVL. The Defi Pulse team will also track these metrics to ensure a high level of accuracy.

Every monetary reward and milestone described in this proposal will use a 7 days TWAP methodology to mitigate risks tied to markets volatility.