AP: A Staking Program for Distribution of Clipper Revenues

1). What's the big idea? Implement a SAIL staking mechanism to generate Real Yield for token holders, who are DAO Members.

2). What is the problem you are trying to solve? Now that governance is fully decentralized, AdmiralDAO needs governance participants. However, there is currently no direct incentive/compensation in place for this. This proposal aims to fix that.

3). Who is this for? SAIL token holders.

4). How might this work?

• SAIL holders who stake their SAIL and participate in voting receive a portion of Clipper’s protocol fees. Since these protocol fees are generated in blue-chip assets (ETH, WBTC, USD), this compensates those who participate with Real Yield.
• This would require developing new staking smart contracts.

5). How might we prototype/test concept desirability and feasibility? Protocol fees (net of DAO costs, e.g., for developing the staking smart contracts) should accumulate as Protocol Owned Liquidity (“POL”) which will further compound value. When POL becomes material, the staking contracts can be commissioned and deployed. Protocol Fee look like they could become extremely large. This could be the next GMX.

6). Suggested Implementation Plan:

• First, the community (all SAIL holders) discusses and decides on the details of the staking implementation–e.g., what % of protocol fees stakers should receive, etc.
• Second, the DAO commissions a legal opinion to ensure that staking rewards do not implicate securities laws, which is often a requirement of exchanges to continue listing.
• Third, the DAO commissions the development of the staking smart contracts.
• Fourth, the DAO redirects the accumulated POL to staking rewards for participating token holders.

7). Why might this idea fail?

• Token holders may want to prioritize maximizing volumes rather than maximizing protocol fees
• Clipper might not generate enough protocol fees to cover the costs.

8). How will we measure success? Amount of protocol fees stored for the community, and amount compensated to token holders for participating in governance.

Important Links

• Link to Phase 1 (Forum discussion) https://discord.com/channels/844729067311202334/1143836847030681610/1143836847030681610

• Link to Phase 2 (Temperature check) https://discord.com/channels/844729067311202334/1142078406188601497/1144585615724249109