ETHFI DAO Proposal: ETHFI Buyback and Liquidity Pool Seeding

Proposal Summary

This proposal suggests initiating the purchase of ETHFI with up to 50% of protocol revenue. Initially 5% of monthly revenue will be used, with future increases to be put to a community vote. The revenue comes from Staking and Liquid vaults. Any revenue of future products to be used for this purpose will be addressed in a subsequent vote. The purchased ETHFI will be used to build the treasury and seed a liquidity pool on Curve to increase TVL on-chain for ETHFI.

Rationale

The objective of this proposal is to enhance the liquidity of ETHFI in order to support the ecosystem by:

1. Increasing the treasury holdings of ETHFI.
2. Providing liquidity on Curve, thus improving market dynamics for ETHFI.

Details

Revenue Allocation

• Initial Allocation: 5% of protocol monthly revenue.
• Sources of Revenue:
  • Staking rewards.
  • Liquid vault revenues.
• Review Period: This allocation percentage will be reviewed and potentially adjusted based on performance and community feedback.

Buyback Mechanism

• Market Purchases: ETHFI will be bought on the open market using the allocated revenue.
• Treasury Allocation: Acquired ETHFI will be added to the DAO treasury to bolster holdings.

Liquidity Pool Seeding

• Curve Pool Seeding: Part of the acquired ETHFI will be used to seed a liquidity pool on Curve.
• Objective: Increase TVL and liquidity for ETHFI, facilitating better trading conditions and user engagement.

Conclusion

This proposal aims to strategically utilize protocol revenue to enhance the liquidity of ETHFI. By purchasing ETHFI on the open market and seeding the liquidity pool, we can strengthen the ecosystem and increase TVL on-chain.

Voting

• For: Approve the ETHFI Buyback and Liquidity Pool Seeding Proposal.
• Against: Do not approve the proposal.

We look forward to your support in strengthening the ETHFI ecosystem.