OIP-20 - Framework for Excess Reserve Allocation

Summary

The assets in OlympusDAO's treasury can be utilized to gain passive yield income for all Ohmies. The objective of treasury management is to balance this productive income, with a very conservative risk tolerance policy. In order to move together to achieve an optimal use of our assets, we must lay out a sustainable asset framework.

This framework should enable the protocol to manage our treasury assets with agility, without the need to go through a (lengthy) governance cycle. The proposal laid out below is to give the DAO the mandate to allocate up to 33% of excess reserves into whitelisted protocols approved by the community (currently Aave, Convex, and Sushiswap). Excess reserves are treasury assets which are not used to back OHM currently in circulation.

Motivation

At the time of writing, the treasury holds 92.5m USD worth of tokens in MV. Of this 92 million, only 4.5m or <5% is currently deployed in whitelisted protocols of which:

4.2m of OHM/DAI LP on Sushi Onsen 1m of DAI on Aave 333K of FRAX on Convex

This only represents 5% of our entire treasury, leaving a lot money on the table. For example, our Onsen LP already netted us around 670K USD in xSUSHI.

This proposal aims to introduce a framework which would allow the DAO to allocate up to 33% of excess treasury reserves in whitelisted protocols. By proposing a % as opposed to a fixed sum, it will allow the DAO to reduce overhead and numerous votes while still maintaining a conservative approach with regards to our treasury management. This in essence makes the DAO more efficient.

One last important note is that these treasury assets can only be used in whitelisted protocols which have been voted on by the DAO. This currently only includes Aave, Convex and Sushiswap but can be extended in the future.

Proposal

This proposal aims to introduce a framework which would allow the DAO to allocate up to 33% of excess treasury reserves in whitelisted protocols.

https://forum.olympusdao.finance/d/87-oip-20-framework-for-excess-reserve-allocation

Vote

Option 1: For the proposed framework (max 33% of excess reserves) Option 2: Against the proposed framework