I appreciate the GMC’s effort to generate low-risk yield on the DAO’s idle 7,500 ETH. The choice of established protocols like Lido, Aave, and Fluid likely stems from their proven track records and ability to deliver stable returns. Deploying 5,000 wstETH into Aave V3 on Arbitrum also directly boosts liquidity in our ecosystem. The reinvestment strategy and focus on incentive programs further suggest a thoughtful approach to maximizing value.
That said, I’d like to offer a few suggestions to enhance the proposal while preserving its strengths. First, the heavy allocation to Lido—5,000 ETH—raises decentralization concerns. As of early 2025, Lido controls ~32% of Ethereum’s staked ETH, relying on just ~100 operators. This concentration has sparked debate, especially after Lido’s governance rejected self-limiting proposals in 2022, amplifying fears of validator dominance. A concrete step to address this could be splitting the staking allocation: say, 3,500 ETH to Lido and 1,500 ETH to Rocketpool. Rocketpool’s ~2,000 independent nodes (per their docs) offer far greater validator diversity even if its APR (~2.5-3%) is slightly lower.
Second, I’d love to see more support for Arbitrum-native protocols. I get why the GMC leaned toward established players—scale and risk management are key with $16.5M on the line—but there are native options with capacity and reasonable risk profiles.
- GMX, for instance, is a standout: its TVL sits at ~$500M, with trading volume exceeding $94B historically. GMX’s TVL grew ~10-15% in Q4 2024 after a 1,000 ETH liquidity boost from the STIP program. 500 ETH could yield a similar bump, adding $50-75M to its TVL. ETH-backed WETH/USDC GM pool might be an opportunity with its delta-neutral exposure and 11.93% APY.
- Camelot’s another contender, crossing $100M TVL in 2023 with 4.5k daily active users in 2024. Allocating even 500 ETH to such protocols could amplify their capacity without undue risk, given their traction and community backing. The APY of wstETH/ETH LP on Camelot is now 7.87%.
- Dolomite can be a decent candidate too with its TVL crossing $900M in 2024. Lending ETH on Dolomite now earns 4.87% APR.