A big thank you to the council for the valuable feedback, and we appreciate the opportunity to address the concerns for another chance at the snapshot vote.
We believe that these concerns can be clarified in our reply below, and hope we can be part of the LTIPP recipients, contributing to the growth of the Arbitrum ecosystem.
Summary of feedback:
GMX Feedback:
- no substantial traction despite being live on Arbitrum for a significant period
- majority of protocol TVL comes from BSC, raising concerns about organic growth
- team has a strong background, but lacks sticky liquidity post-incentives
- needs innovative features that would ensure the longevity of these incentives
- grant size is reasonable, but might just attract mercenary farming behavior
Wintermute Feedback:
- application was solid and scored well across various criteria
- provided a clear and concise execution plan, milestones, KPIs, and goals
- requested grant size is justified
- current metrics on Arbitrum is underwhelming given the age of the protocol
- prefer to see more focus on encouraging stickiness and migrating their BSC users
GFX Feedback:
- generally liked this grant – sized appropriately and had a simple, easily monitored plan of execution
- would like to see a concerted effort to market these incentives to AcryptoS’ existing user base on BSC
The direct link to the council’s feedback can be found here.
Launch Date and Product Differentiation:
We noticed that the main concerns were regarding TVL growth not being proportionate to the period launched, seemingly indicating lack of interest and growth.
This is possibly due to a misunderstanding regarding our launch date for the ACLM product. We actually launched our ACLM vaults for Arbitrum on Aug 4th 2023 (txn), which is just slightly more than half a year ago. TVL growth has shown to be strong for a new product in this relatively short time period.
We apologize as our initial proposal might have caused confusion by mentioning a 2022 deployment on Arbitrum (in Section 2b above).
That deployment was for our other product (single-token vaults) which we did not include in this grant proposal. In our proposal, we put in the 2022 deployment txn as we weren’t sure if we were supposed to put in the ACLM deployment date, or the date we first launched any product on Arbitrum.
It’s also important to note that we do offer two main products, and they cater to two distinct user profiles with different risk preferences.
- single-token vaults, built on lending protocols
- single token exposure, no IL risks
- ACLM vaults, built on V3 Conc Liquidity DEXs
- two token exposure, high IL risk due to V3 CL mechanics
Due to the above factors, there’s minimal overlap between user bases for these products. Our single-token vaults have seen success on the BSC network, with DefiLlama stats showing a large portion of our current TVL coming from BSC. However, the main bulk of the TVL in BSC is from our single-token vaults.
As this proposal specifically focuses on our newer product - the ACLM vaults, attempting to migrate the BSC TVL (of a vastly different user profile) wouldn’t be relevant for the proposed grant. Therefore our proposal focuses more on trying to attract users that are currently:
- already manually providing liquidity in V3 CL DEXs
- using other liquidity managers but exploring better performing strategies
- still providing liquidity in V2 DEXs, hesitant to move to V3 due to the hassle of V3 LP position setting, rebalancing etc.
Traction, TVL Stickiness, and Incentives:
We’d like to clarify that our ACLM product has actually seen positive traction. Notably, Arbitrum currently holds the highest TVL (~$1 Million) among our ACLM deployments across five chains. Since the launch in Aug 2023, we’ve observed organic growth in our ACLM TVL and user base, suggesting strong strategy performance. This has been achieved even without initial and ongoing incentives.
Stickiness of TVL on these vaults have been apparent, where users start exploring our new vaults organically, and decide to keep their TVL there over the months as APY for these vaults have been consistently good for them. These strategies have consistently outperformed similar LP pairs on other CL-managing platforms, especially on stable token pairs, as seen below.
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Link to our dapp for live APY and TVL stats on Arbitrum:
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Additional ACLM performance stats can be found in our original forum proposal above (Section 2)
We believe the proposed Arbitrum LTIPP grant would primarily serve as a way to gain valuable exposure, allowing our strategies to speak for themselves and attract users organically.
Fair Competition and BUIDLing focused on Arbitrum:
We understand the importance of a healthy competitive landscape, especially with other ALMs receiving grant support on Arbitrum. A similar incentive for our product would create a fairer environment for performance comparison. Our proven strategies consistently deliver strong results, and with a minimal grant request of 80,000 ARB, this proposal presents a cost-effective opportunity to evaluate how our ACLM fares against competitors in a similar incentivized setting.
We are firmly committed to developing on Arbitrum. This commitment is reflected in our continuous deployment of new vaults specifically on Arbitrum. In fact, our latest two vaults were just deployed two weeks ago, on April 6th. Our Arbitrum ACLM vaults are currently at one of the largest numbers (25 ACLM vaults) compared to the other chains we’re deployed on.
Conclusion:
We believe this additional information addresses the feedback received from the Council and clarifies any potential misunderstandings. We remain confident that our proposal offers a valuable addition to the Arbitrum ecosystem and that our ACLM product has the potential to thrive with the requested support.
In light of these clarifications, we kindly request the DAO to consider taking a closer look at our proposal. Additionally, we would be grateful if a delegate could post a snapshot vote for the DAO to cast their votes on our proposal.