Our delegation decided to ABSTAIN on this proposal.
After receiving feedback from the Council, Clipper has reduced its request from 240K ARB to 174K ARB and has also provided a better description of its milestones and execution plan. However, these changes are not sufficient to approve the proposal.
One issue we have, which we have pointed out during the feedback period (we were their advisors), is that they estimate the requested amount based on the TVL they aim to achieve with incentives rather than their current TVL. In their calculations, they target a TVL of 2.4M and calculate the grant amount based on this value.
Before this modification, they calculated their target TVL at 3.5M and justified the grant amount based on that (an additional 70K for LP incentives).
This indicates that they have not changed the justification for their request based on the Council’s feedback but have simply reduced their growth expectations to fit what they believe is the problem with the application (the size). But the justification is the problem.
For example, feedback from GMX stated: “The justification provided for the grant size seems inflated and lacks concrete evidence to support the proposed numbers. Additionally, while the objectives are outlined clearly, the execution strategy appears somewhat speculative.”
The new request has not addressed this concern. The basis for their request remains speculative and lacks evidence that the TVL will grow to 2.4M upon initiating incentive distribution. I also don’t understand why they are using a value of 1.95 USD per ARB to calculate their request when the current market reality is different.
Having said that, during the screening period, Clipper received support from two members of the Council, and now GFX has stated that the applicant has improved their application. Therefore, we have decided to abstain while not fully satisfied with the modifications to the proposal but in support of the Council’s criteria.