Regulating LVL Balance

The Level DAO is a facilitation vehicle for the Level protocol. It is not purely for profit and its purpose was never solely the accrual of value. In barely seven months, the DAO has accumulated over $12.7m of BTC, ETH, and USDT. Level DAO is the protocol’s largest liquidity provider and boasts a war chest of more than $108m in platform tokens alone. Thanks to several well aligned strategics, the DAO was also able to provide a fair amount of short-term liquidity to the various AMM’s where LVL is traded on. During the month of June, the DAO added $4,370,095 to its BTC, ETH, and USDT reserves in addition to acquiring 180,842 LVL through liquidity provision on AMM’s. As part of treasury management, we would like to propose a mechanism to regulate the DAO’s LVL balance. Given that the DAO accrues trading fees on a continuous basis, we propose a 1:1 burning of LVL tokens from the treasury reserve for every 1$ of trading fees it accumulates. At terminal emission, LGO’s intrinsic value (currently at $1,021,283 per LGO), should equal its surrender value.

With the upcoming implementation of Level’s omni-chain rewards mechanism along with cross chain staking, the utility value of LVL tokens has never been stronger. The ultimate goal of the protocol is to become the most functional blockchain agnostic liquidity marketplace. To do so, LVL tokens need to be delivered to its community of users at a rate that is proportionate to the growth of the platform itself. We believe that reducing terminal supply of LVL at the same rate that the platform is growing is a great way to simultaneously enhance the value of the protocol as well as reward its community of early adopters committed to the long term success of the protocol.

In this proposal, we would like to ask the DAO to vote on:

1. Burn 180,842 LVL accumulated on TraderJoe LP
2. Implement continous weekly burning of LVL tokens

VOTING OPTIONS

• For: Agree with this proposal
• Against: Do not agree with this proposal
• Abstain: Do not have strong opinion about this proposal

RULES

• Only LGO token holders are eligible to vote
• This proposal requires at least 10 LGO voted to pass