[Bunni] LTIPP Application - FINAL

SECTION 1: APPLICANT INFORMATION

Applicant Name: MajeStyle, McFly

Project Name: Bunni / Timeless

Project Description: Bunni is an innovative liquidity engine designed to incentivize Uniswap v3 liquidity by transforming NFT positions into ERC-20 tokens and employing a ve-tokenomics system for rewards.

Team Members and Roles:

  • McFly: Operational administration, UI development

  • ZeframL: Smart contract design & development

  • Szeth: Frontend development, Subgraph development, Solidity

  • Dakotah: Operations, team building, marketing, strategy, growth

  • Razzka: Marketing and Community Manager

  • MajeStyle: Growth Advisor

Project Links:

Contact Information

Point of Contact: MajeStyle, McFly

Point of Contact’s TG handle: Telegram: Contact @MajeStyle69 / Telegram: Contact @mcfl_y

Twitter: https://twitter.com/Majestyle69 / https://twitter.com/0xmcflyeth

Email: maje [at] orangecatsolutions.com

Do you acknowledge that your team will be subject to a KYC requirement?: Yes

SECTION 2a: Team and Product Information

Team experience:

  • Mcfly: overseeing operational administration, and UI development.
    • Background: Active in the Ethereum ecosystem since 2017; co-founded Bunni, Timeless, and 88mph. Preceding this, served 7 years as a UX lead for multiple firms.
    • Experience: Skilled in cultivating communities, steering projects, and managing operational and financial responsibilities.
    • Skills: operational management, financial supervision, and UI design and development.
  • ZeframL (Smart contract design & development)
    • Background: B.S. & M.S. in Computer Science from UCSD
    • Experience: Building Ethereum smart contracts since 2017, cofounded 88mph, Sudoswap, and Timeless.
    • Skills:Smart contract design & development
  • Szeth (Frontend development, Subgraph development, Solidity)
    • Background: BA Economics from Stanford
    • Experience: 3 years in DeFi application development
    • Skills: Solidity, Rust, Smart Contract Development, Project Management
  • Dakotah (Operations, team building, marketing, strategy, growth)
    • Background: 10 year+ small business operator
    • Experience: Biz Dev Lead at 88mph, Lead of Growth at Timeless and Bunni.
    • Skills: Operations, team building, marketing, strategy, growth
  • Razzka / Mehmet Oğuzhan Kurt (Marketing and Community Manager)
    • Background: BA in International Finance, Bahçeşehir University
    • Experience: 5 years of experience in marketing and community management in the crypto space. Oversaw the marketing strategy for [GHI Project], increasing its user base by 300% in one year.
    • Skills: Content Creation, Social Media Management, Community Engagement, SEO

What novelty or innovation does your product bring to Arbitrum?

Bunni, introduces a novel approach to liquidity provision on Arbitrum by transforming Uniswap v3 liquidity positions into fungible ERC-20 tokens, coupled with a ve-tokenomics system forked from Curve for incentivizing liquidity. This innovation helps protocols bootstrap liquidity, and allows liquidity providers to more profitably deploy funds on Uniswap.

Is your project composable with other projects on Arbitrum? If so, please explain: Yes, all positions, while earning rewards, are represented by an ERC-20 receipt token which is further supported by Bunni for integrations with services like lending markets or CDPs through “Bunni Oracle”. Such integrations are currently being discussed with a few protocols like Sturdy Finance.

Do you have any comparable protocols within the Arbitrum ecosystem or other blockchains?
There are other methods for incentivizing Uniswap liquidity, like Merkl, but no other protocol is quite like Bunni.

How do you measure and think about retention internally? (metrics, target KPIs)

  • TVL
  • Trading Volume
  • Daily Active Users
  • Daily Protocol Fee
  • Amount of bribes to veLIT holders
  • Activity in our governance

Relevant usage metrics - Please refer to the OBL relevant metrics chart 20. For your category (DEX, lending, gaming, etc) please provide a list of all respective metrics as well as all metrics in the general section:

  • Unique Users
  • Daily Active Users
  • Daily User Growth
  • Daily Transaction Count
  • Daily Protocol Fee - Trading volume
  • Daily Transaction Fee
  • Daily ARB Expenditure and User Claims
  • Incentivized User List & Gini

Do you agree to remove team-controlled wallets from all milestone metrics AND exclude team-controlled wallets from any incentives included in your plan: Yes

Did you utilize a grants consultant or other third party not named as a grantee to draft this proposal? If so, please disclose the details of that arrangement here, including conflicts of interest (Note: this does NOT disqualify an applicant): No

SECTION 2b: PROTOCOL DETAILS

Is the protocol native to Arbitrum?: No, it was first deployed on Mainnet Ethereum

On what other networks is the protocol deployed?: Mainnet Ethereum

What date did you deploy on Arbitrum mainnet?: July 2023 - https://twitter.com/Timeless_Fi/status/1679596601302712328

Do you have a native token?: Yes, LIT - LIT | Bunni Docs

Past Incentivization and Current Incentivization: Historically, liquidity on Bunni has only been incentivized by LIT inflation, resulting in the Timeless Wars. Demand for LIT has been met organically. Protocols have either purchased or farmed veLIT and voted for their own gauges or deposited bribes for veLIT voters to direct incentives.

Have you received a grant from the DAO, Foundation, or any Arbitrum ecosystem related program? No

Protocol Performance:

Dune Dashboard - Another Dune Dashboard

DefiLlama
Bunni has demonstrated significant progress and achievements in enhancing DeFi liquidity on Uniswap v3. Our progress on Arbitrum has stagnated due to the lack of a good UX around oLIT, which needed to be swapped on Arbiturm or bridged with the official bridge, thus needing users to wait for 7 days, and then execute costly Mainnet transactions.

Our commitment to improving oLIT UX is evident in our implementation of the xERC20 token standard which now allows users to quickly bridge oLIT to Mainnet.

We are yet to see the positive community and ecosystem impact of this change, which happened very recently.

Protocol Roadmap: The Growth Unit is currently working towards onboarding more protocols and more TVL by creating high-volume tight ranges for highly traded tokens. The Engineering Unit is making steps towards further improving the xoLIT UX, but more importantly in launching Bunni v2 which will be a front-end for Uniswap v4.

Audit History & Security Vendors:

Bunni has undergone multiple audits and has an ongoing bounty program:

Security Incidents: N/A

SECTION 3: GRANT INFORMATION

Requested Grant Size: 30`000 ARB

Justification for the size of the grant: Our initial deployment with a few partners like Gravita and Savvy, as well as the distribution of FRAX STIP incentives on the FRAX / FPI and FRAX / ARB pairs on Bunni allowed our Arbitrum instance to grow past the 1M in TVL mark:

However, user dissatisfaction with oLIT’s bridging delays saw the protocol focus their efforts on offering oLIT liquidity on Aribturm, which quickly saw the price of the reward token dump without an immediate arbitrage opportunity due to the 7 days delay of Arbitrum’s bridge.

In response, we recently partnered with Connext, utilizing the xERC20 standard to transform oLIT to xoLIT, enabling rapid bridging from days to minutes. We are already seeing that this significant improvement has rekindled partner and user interest, which will allow the growth of the protocol to resume.

Grant Matching: We intend to continue (with our own funds or protocol revenue) the practices suggested in this application if proved successful.

Grant Breakdown: We request a fairly small grant based on our projected TVL because we believe that success comes by being a non-extractive partner that is aligned for the long term. This is particularly obvious from our investment in Bunni v2, which will be a front-end for Uniswap v4 with a lot of extremely appealing features. We are particularly committed to build bridges to work alongside Arbitrum-centric projects and protocols to expand our reach to new communities on the chain.

The case outlined thus far, and the metrics supporting it, suggest a little boost can go a long way in benefitting the ecosystem and our protocol. With the 30’000 ARB ask, we’re confident that Bunnii’s value proposition will be obvious to both users and protocols as well as provide a new case study in cost-efficient incentive programs.

We intend to spend the grant as follows:

  • Matching the bribes of our partners on the chain. We are already engaging in discussions about migrating to Arbitrum some of Mainnet incentives with FRAX, Savvy (who has pools that can be co-incentivized with FRAX itself) and Ether.fi, who we already partnered with on Mainnet. Other protocols which are our partners on Mainent are yet to deploy liquidity incentives on Arbitrum, for example Swell, Alchemix, Redacted and Inverse. A governance proposal is also currently live for Connext. A few more partners are likely to have started their commitment by the time this proposal is into voting, as it can be seen here. We expect this to require about 1000-2500 ARB per week. If we will receive too many requests for bribe-matching, we will prioritize longer-term partners and then higher bribes.
  • The above will last until the grant is fully used. If it is not fully used, all unused incentives from the previous point will be returned.
  • Creating and incentivizing with either direct incentives or vote incentives (whichever is more efficient) high-volume stable pairs like USDC / USDC.e to a target 20-30% APR. A range similar to the one of this user attracted an 11% organic APR. Bunni is able to deliver a particularly good efficiency with stable pairs because of the nature of the “fixed” positions which are converted into ERC-20. In the case of this pool, even if our deployment gets 1M TVL (in a bullish scenario), incentive cost to add 9% APR will just be: (1M / 100)*9 = 90000 USD per year, 20769 during the 12 week period which is approximately 10350 ARB over the 12 week period of the grant at current valuation. The highlight here is that even minimal incentivization will make depositing into this range appealing and seamless through Bunni. Numerous untapped opportunities similar to this exist in the market, denoted by our USDT/USDe Mainnent range rewarding users with 50%+ purely organic APR, as well as our old rETH/ETH range which attracted 350 ETH of liquidity and generated more than 20M in volume in a few months.

This approach allows Bunni to disburse the grant in an aligned way since protocols will have to upfront the cost and show some level of commitment, ensuring that the whole ecosystem can potentially benefit from this activity

Funding Address: arb1:0x77B1825b2FeB8AA3F8CF78809e7AEb18E0dF719d

Funding Address Characteristics: 3 / 5 multisig

Treasury Address: 0x9a8FEe232DCF73060Af348a1B62Cdb0a19852d13

Contract Address: TBD, N/A

SECTION 4: GRANT OBJECTIVES, EXECUTION AND MILESTONES

Objectives: The primary objectives of the grant request are centered around enhancing the user acquisition and overall engagement from both protocols and users with Uniswap v3 liquidity provision.

Execution Strategy: Our execution strategy for the grant is planned to be as lean as possible with the intent to maximize the impact on the Arbitrum ecosystem despite the fairly small ask and ensure efficient use of funds. The fact that partners have to disburse funds of their own to obtain a matching ensures that our efforts are aligned with protocols demonstrating commitment, thereby welcoming a synergistic growth environment.

  1. Allocation for Liquidity Incentives: We plan to dedicate up to 10,000 ARB over the 12-week period specifically for incentivizing high-volume liquidity pairs, targeting APRs of 20-30% for these stable pairs.

  2. Bribe Matching Strategy: The remaining 20,000 ARB is earmarked for matching bribes over the 12-week period, translating to a cap of 1,666.66 ARB weekly. Should the demand exceed this weekly cap, our allocation criteria will prioritize:

  3. Up to 1000 ARB per week, existing Bunni partners such as Savvy, Badger, Frax, Alchemix, Inverse Finance, Aura, Swell, Ether.fi, Gravita, and Redacted Cartel, acknowledging their ongoing commitment and collaboration.

  4. For the remainder amount, projects offering the highest USD-denominated bribes

  5. Any unutilized funds from a given week will roll over into the next, accommodating the varying bribe schedules of our partners. This is entirely justified by the fact that some bribers adopt a strategy that sees them profitable bribe only every other epoch, as a consequence of the design of Bunni which, like Curve, has 7-days-long epochs but 10-days-long vote locks.

  6. Mid-Program Evaluation: Between weeks 6 and 8, we reserve the option to reassess and potentially reallocate the budget between those 2 projects based on their performance and impact. This flexibility ensures that we are dynamically responding to the program’s success, with a willingness to return unused ARB to the DAO if the projects do not meet expected targets.

What mechanisms within the incentive design will you implement to incentivize “stickiness” whether it be users, liquidity or some other targeted metric?

To ensure enduring user engagement and liquidity retention, Bunni has devised an incentive mechanism that catalyzes a self-reinforcing flywheel effect, mirroring the successful models seen in platforms like Curve. Users engaged with Bunni earn oLIT tokens, which can be redeemed for LIT by pairing with ETH. This process is designed to benefit veLIT holders, as a portion of the ETH used in the redemption process is distributed to them, providing a tangible yield in both ETH and BAL, encouraging users to lock their LIT into veLIT to receive this yield. Holding veLIT not only increases the rewards of users on their liquidity positions but also grants them voting power to direct more incentives towards their positions or to capture bribes from protocols seeking to enhance their liquidity through Bunni. This ecosystem creates a compelling reason for users to maintain and deepen their engagement with Bunni, engaging a virtuous cycle of participation and reward that enhances the protocol’s stickiness and overall value proposition.

Specify the KPIs that will be used to measure success in achieving the grant objectives and designate a source of truth for governance to use to verify accuracy.

The KPIs for measuring the success of our grant objectives can be found above in our grant request and are fairly straightforward:

  1. Total Value Locked (TVL): Achieving and surpassing a TVL milestone of $2M (with a peak TVL at 1M around 1 month ago, and a current TVL of approximately 200k USD) which signifies a robust and growing liquidity base. This KPI is crucial as it demonstrates the effectiveness of our incentive mechanisms in attracting and retaining liquidity providers, thereby ensuring a deep and stable market for traders.
  2. Volume Generated: Monitoring the trading volume generated through incentivized pairs, especially the high-volume stable pairs like USDC / USDC.e, to assess the market activity and liquidity usage. A target of generating significant trading volume indicates that Bunni is facilitating active trading environments, which is essential for the long-term sustainability and utility of the platform.
  3. Partnership Expansion: This evaluates our success in building a collaborative and synergistic ecosystem, enhancing the overall value proposition of Bunni within Arbitrum. We expect this program to generate at least 5 more long-term partnerships, ideally with projects that we are inviting to incentivize on Arbitrum for the first time, like our partners Swell, Ether.fi, Inverse etc.

The source of truth for verifying the accuracy of these KPIs will be DefiLlama.

Grant Timeline and Milestones:

Since our approach is slightly speculative and intentionally allows some wiggle room, we intend to only have a Week 8 Intermediary Milestone by which time we should have the following results:

Total Value Locked (TVL): Reach again a TVL of $1M.

Partnership Expansion: Secure at least 10 new strategic partnerships (of which we aim to retain at least 5 long-term collaborations). Early success in forming these partnerships will validate our approach to ecosystem synergy and collaboration, demonstrating Bunni’s appeal to potential partners and its capacity to offer value-added services within the Arbitrum ecosystem.

How will receiving a grant enable you to foster growth or innovation within the Arbitrum ecosystem? Receiving this grant will enhance Bunni’s capacity to elevate Uniswap’s usage within the Arbitrum ecosystem for bootstrapping liquidity, which has in some ways been hindered by the lack of an incentivization mechanism in an ecosystem where incentives (elsewhere) were plenty. By leveraging the grant to augment Bunni v1, we aim to draw in a wider array of protocols to Uniswap, assisting them in bootstrapping their liquidity more effectively & preparing them for the Uniswap v4 deployment…

In many ways this initiative is not only about bolstering current operations but also about laying the groundwork for the highly anticipated launch of Uniswap v4. With Bunni v2 set to fully support this new version, our goal is to utilize the grant to demonstrate our dedication and kickstart a powerful network effect. With the implementation of innovative features in Bunni v2, we anticipate setting a new standard for protocol integration and user experience on Arbitrum. This forward-thinking approach is designed to not only support the immediate growth of Uniswap and Bunni on Arbitrum but also to establish a solid foundation for the future, where these platforms become indispensable pillars of the DeFi ecosystem. This vision, backed by the grant, aligns with our commitment to innovation and the broader objectives of fostering a dynamic and thriving DeFi landscape on Arbitrum.

Do you accept the funding of your grant streamed linearly for the duration of your grant proposal, and that the multisig holds the power to halt your stream? Yes

SECTION 5: Data and Reporting

OpenBlock Labs has developed a comprehensive data and reporting checklist for tracking essential metrics across participating protocols. Teams must adhere to the specifications outlined in the provided link here: Onboarding Checklist from OBL 4. Along with this list, please answer the following:

Is your team prepared to comply with OBL’s data requirements for the entire life of the program and three months following and then handoff to the Arbitrum DAO? Are there any special requests/considerations that should be considered? Yes

Does your team agree to provide bi-weekly program updates on the Arbitrum Forum thread that reference your OBL dashboard? Yes, we can create bi-weekly posts on the Aribtrum Forum to present the data from the period in question.

First Offense: *In the event that a project does not provide a bi-weekly update, they will be reminded by an involved party (council, advisor, or program manager). Upon this reminder, the project is given 72 hours to complete the requirement or their funding will be halted.

Second Offense: Discussion with an involved party (advisor, pm, council member) that will lead to understanding if funds should keep flowing or not.

Third Offense: Funding is halted permanently

Does your team agree to provide a final closeout report not later than two weeks from the ending date of your program? This report should include summaries of work completed, final cost structure, whether any funds were returned, and any lessons the grantee feels came out of this grant. Where applicable, be sure to include final estimates of acquisition costs of any users, developers, or assets onboarded to Arbitrum chains. (NOTE: No future grants from this program can be given until a closeout report is provided.): Yes

Does your team acknowledge that failure to comply with any of the above requests can result in the halting of the program’s funding stream?: Yes

4 Likes

Hello @majeststyle,

Thank you for your application! Your advisor will be @JoJo.

Please join the LTIPP discord and ping your advisor in the general chat so they can create a new channel and start communicating with you.

3 Likes

Hi @cliffton.eth , @raam , how are you? Can you change the tag on this proposal to “SEMIFIN”, as requested by Jojo? Thanks a lot for your help

Hey @majeststyle , the ‘SEMIFIN’ optional tag has been added to this proposal as requested. Please let me know if there’s anything else we can help with. Cheers!

1 Like

Hi there, thanks a lot for your help. We are ready to declare our application as FINAL

Hey there, I’ve marked this post as FINAL. All the best!

We are always proponents of the idea of incentivizing Uniswap v3 liquidity. Even though the grant is planned small, the execution strategy is planned as much as possible with the intent to maximize the impact and efficient use of the funds. The thing that we loved about the proposal was the team’s experience and the other details were clean, which is important for all the questions in our mind.

1 Like