TIP-6 - ESD Protocol Design & Development

Summary

This grant proposes to fund design and development of ESD V2 as outlined here. We plan to use the money to create two important and interrelated outputs.

• First, a detailed technical specification for the ESD V2 protocol.

• Second, a modular roadmap to incrementally upgrade the current ESD system responsibly and efficiently.

Upon successful completion of each module, we will present our work to the community for feedback and subsequent integration into ESD via the governance process. We will then request funding for the design, development, and auditing of the next module.

We picked this method to reduce execution risk to the ESD DAO. If any stage of the project is deemed unsatisfactory, the DAO can choose to fund another team to continue the work or chart a new course.

Background

The major changes proposed in ESD V2 are the following:

• Addition of a protocol reserve fund to serve as partial collateral and buffer price volatility
• Replacement of expiring coupons with fixed maturity debt
• Payment of excess reserves to DAO stakers

Team

Andy Chorlian - ex-MakerDAO smart contract developer, YFI strategist Dan Matthews - PieDAO, Audit DAO Austin Williams - OpenZeppelin auditor and creator of Coupon Clipper Scott Lewis - DeFi Pulse, Slingshot and mechanism designer Will Price - crypto data scientist and mechanism designer

Funding Request

We expect this stage of the project to take 5-6 weeks to complete, with an average time commitment of 15 hours per week per team member. We are requesting 100,000 ESD to fund this effort.

In order to expedite future development, we recommend that the community start considering putting an audit firm on retainer.

Fund Custody

The team will allocate funding amongst its members retroactively in proportion to contributions made. Funds will be stored in a Gnosis multi-sig controlled by the team, which is to be funded by the ESD treasury following the approval of this proposal.

Gnosis multi-sig address: 0xbc57cc1fC673C7e191Eeb03b8AA2e8238A9225DD Threshold: 3 of 5

Deliverables

• Jan 18 - Technical specification first draft released to the community with a request for comments.
• Jan 25 - Technical specification final draft and roadmap first draft released to the community
• Feb 1 - Final technical specification released
• Feb 8 - Detailed implementation roadmap and technical specification published.

Following successful completion of the first phase, a funding request for the next phase of development (smart contract implementation) will be submitted.