[RAMSES] [FINAL] [STIP - Round 1]

SECTION 1: GRANT INFORMATION

Applicant Name:
Ramses Exchange

Project Name:
Ramses

Project Description:
Ramses combines incentives with concentrated liquidity (CL) to provide a unique model amongst other liquidity bootstrapping solutions and DEXs across the DeFi landscape.

Specifically, Ramses enables veRAM holders (majority of which are Arbitrum protocols) to direct emissions in a decentralized manner, and collect fees from CL positions in addition to traditional AMM pools. The result of combining incentives with competitive distribution is unrivaled capital efficiency producing a 5x improvement in volume-to-tvl and the lowest possible slippage in DeFi. It is hard to overstate the long-term impact this public good will have on Arbitrum builders.

Team Members and Qualifications:

  • North
  • Dog
  • Ren6
  • Alpha
  • CNA

Project Links:
Ramses Exchange
R A M S E S · GitHub

Contact Information:
TG: Telegram: Contact @ExchangeRamses
Twitter: @RamsesExchange
Email: management@ramses.exchange

Do You Acknowledge That Your Team WIll Be Subject to a KYC Requirement?:
Yes

SECTION 2: GRANT INFORMATION

Requested Grant Size: 1,248,000 ARB – any unused will be returned to the DAO.

Grant Matching:
Yes.

Ramses will match up to 1,000,000 RAM weekly in the form of xoRAM to foster sustainable ecosystem growth.

Grant Breakdown:

After thoughtful discussions with delegates and the voices in the community, we are adjusting our STIP to adopt a model similar to that of other AMMs. This decision ensures there is continuity and clarity, and eliminates any potential confusion for the short-term nature of this program. We are grateful for the insights and guidance that have led us to this positive adjustment.

To be clear - LP’s will now be the only recipients of ARB incentives.

104,000 ARB/Epoch

- 50% of ARB allocated as direct LP incentives for concentrated liquidity pairs, with a focus on ARB pairings, key ecosystem participants, and blue-chips
- 50% of ARB allocated as direct LP incentives matched to fees generated on the pair by the end of the prior epoch. *Epoch N-1 fees will be matched with ARB distributed to Epoch N liquidity providers. This has a global cap of up to 52,000 ARB/Epoch, and RAM will be used to match these (up to 1,000,000/epoch).*

Funding Address:
Ramses Multisig– 0x20d630cf1f5628285bfb91dfac8c89eb9087be1a

Funding Address Characteristics:
Multisig with 2 of 5 signing weight

Contract Address:
0x20d630cf1f5628285bfb91dfac8c89eb9087be1a
We will distribute weekly from the multisig directly to the Gauge contracts for each qualifying pool.

SECTION 3: GRANT OBJECTIVES AND EXECUTION

Objectives:

  • 3 New Partners Onboarded to Arbitrum
    • Attract new, quality long-term developers and projects to Arbitrum
  • $10M TVL Increase
    • Help new, growing and established projects on Arbitrum to bootstrap and build liquidity in a sustainable and capital-efficient manner

Key Performance Indicators (KPIs):

  1. New Partners onboarded (1 new partner per month) Qualitatively, we will continue to onboard long-term developers building compelling and additive projects.
  • Presented in a list and verified with links to associated Twitter announcements from the new partner
  1. Monthly transaction volume increase (evidence of efficient use of liquidity which equates to sustainable protocol growth for partners)
  • Presented via Dune dashboard sourced from verifiable on-chain data via Defillama
  1. Increase total # of pools incentivized by Partners to measure the grant’s positive impact on developers investing deeper into building long-term presence on Arbitrum
  • Presented via Dune dashboard sourced from verifiable on-chain data
  1. TVL increase (trailing metric for the success of partner’s investing in and growing with Arbitrum via incentives and resulting efficient transaction volume increase on their key project tokens)
  • Presented via Dune dashboard sourced from verifiable on-chain data via Defillama

How will receiving a grant enable you to foster growth or innovation within the Arbitrum ecosystem?:
*New projects need resources to quickly and efficiently bootstrap initial liquidity, while existing protocols need to sustain and grow their liquidity at minimal cost. This grant will enable Ramses to onboard and sustain new projects in the Arbitrum ecosystem which will help drive innovation and overall growth.

Justification for the size of the grant:
Ramses has the infrastructure and partners in place to leverage the requested grant size efficiently to rapidly attract sustainable TVL from Mainnet and other chains.

Ramses operates as an extension of Arbitrum itself, augmenting the economic engine of $ARB incentives with $RAM as well as the business development / onboarding arms of the Foundation, rapidly accelerating ecosystem growth and sustainability. As required by this incentive framework, zero $ARB will be used for operations or to compensate team members and instead, 100% of the funds will be used to support ecosystem positive partner protocols building sustainable projects on Arbitrum.

Arbitrum incentives on Ramses are basically a 2-3x multiplier of liquidity incentives - including grants - for the ecosystem at large, making it easier for protocols to onboard onto Arbitrum and cheaper for them to operate, resulting in lower burn rates for $ARB and the project’s native tokens as compared to direct LP incentives. On Ramses, protocols create revenue-positive liquidity programs that will sustain them and the ecosystem at large for years to come.

Execution Strategy:

Arbitrum incentives on Ramses make it easier for protocols to onboard onto Arbitrum and cheaper for them to operate, resulting in lower burn rates for the project’s native tokens. On Ramses, protocols create revenue-positive liquidity programs that will sustain them and the ecosystem at large for years to come.

Execution Strategy:

Method of Distribution

The ARB will stream over each epoch (7 days) via RAMSES’ Concentrated Liquidity Rewarder (Gauges). This implementation has the following advantages to regular, and off-chain solutions:

  • NO staking involved, no custody or approval given to any contracts to participate in earning ARB
  • Permissionless, any user can deposit LP Incentives via the Incentivize page on the dAPP.
  • Fully on-chain and verifiable. There is no trust or off-chain computation required, it is all calculated within the contracts themselves.

The ARB will be distributed at the beginning of each epoch, thus streaming out over the next 7 days linearly to all active market makers proportional to their efficiency.

A non-exhaustive list of pools which already exist and could fall in-line with eligibility can be found on the liquidity dashboard at: R A M S E S as well as on the analytics dashboard(s): RAMSES CL Analytics

An existing implementation example of our RamsesV2Gauge contracts can be reviewed at: GaugeV2 | Address 0x80c4f687b81d77b33c6e3e572e2e80dccc996733 | Arbiscan

Fee matching will be done by taking the fees generated by a pool in the prior epoch (N-1) and distributing the equivalent (up to the global cap) in ARB via RAMSES gauges in the current epoch (N). The statistics will be sourced from many places, such as our in-house analytics page(s), dune dashboards, as well as any other scripts/on-chain verification methods to provide accurate information.

Grant Timeline:

Grants will be distributed weekly (per epoch), until the end of the S.T.I.P. cut-off at the end of January.

Fund Streaming:
Yes, the Ramses team believes in accountability and is happy to oblige by all discretionary actions made by the grant distribution multisig.

SECTION 4: PROTOCOL DETAILS

Is the Protocol Native to Arbitrum?:
Yes

On what other networks is the protocol deployed?:
No other chains

What date did you deploy on Arbitrum?:
March 22, 2023

Protocol Performance:
Summary - we’ve spent the last 6 months onboarding the best partners in DeFi, shipping and demonstrating best-in-class technology, and setting the table for long-term growth and sustainability.

  • 90.5% of RAM is locked into veRAM positions signifying high long-term conviction and support of the protocol by users and partners
  • Cumulative Volume (all-time): $490M
  • 30-day Cumulative Volume: $95M
  • Distributed over $4M in accrued revenue to protocol users
  • Averaging over $3.5M in daily transaction volume since the introduction of Ramses Concentrated Liquidity
  • Delivered a best-in-class volume-to-tvl efficiency Dex
  • Onboarded 40+ partners including:
    • Alchemix
    • FRAX
    • Liquity
    • GAMMA
    • Radiant Capital
    • MCLB
    • Swell
    • Vela Exchange
    • Yearn
    • LayerZero
    • Olympus DAO
    • Gamma Strategies
    • Ankr
    • Kyber
    • Angle
    • Beefy
    • The ByteMasons
    • Axelar
    • Ethos Reserve
    • Odos
    • DAOMaker
    • DEUS
    • Gravita Protocol
    • Firebird
    • Gains Network
    • GMD Protocol
    • Granary
    • Yield IQ
    • Ichi
    • GND
    • Inverse Finance
    • Jarvis Network
    • Liquid Driver
    • Muon
    • DefiEdge
    • Overnight Finance
    • QiDAO
    • 1inch
    • Root
    • SHRAP
    • Paraswap
    • Tarot
    • SYMM I/O
    • The Ennead
    • UNIDEX
    • xCAD
    • Davos
    • YFX
  • Collaborated with key ecosystem builders including LayerZero and Axelar to help existing protocols accelerate their extension/migration and get a fast start on Arbitrum
  • Shipped two full front-end version overhauls and a novel concentrated liquidity+bribe infrastructure innovation that delivers best-in-class volume-to-tvl efficiency
  • Promoted and accelerated the growth of Arbitrum through evangelizing via cross-promotion with top Mainnet protocol communities
  • Consistently provided support for other similar projects on Arbitrum, and across different chains, to ensure the secure growth of DeFi’s lifeblood – AMMs
  • Dedicated thousands of man-hours to integrate with key Arbitrum ecosystem players; keeping an open-mind and flexibility about criticisms given to the team
  • Community-first mindset that hears out all users, regardless of seniority or experience, in order to proliferate DeFi education en masse.
  • Suggested, recommended and facilitated introductions to other competing DEX’s on Arbitrum for incoming Partners seeking liquidity diversity

Protocol Roadmap:
Defi is ever-evolving and we will continue to adapt and deliver improvements that maintain Ramses as a best-in-class, secure, and contributing protocol on Arbitrum.

Audit History:

Formal Audits - Ramses Ramses is audited by yAudit (Yearn’s auditing arm), and consistently performs internal reviews to ensure information assurance.

The Solidly codebase underwent a partial security audit on January 30, 2022, specifically focusing on the AMM component. The audit was conducted by PeckShield, and the full audit report can be downloaded from the Solidly GitHub repository at: https://github.com/solidlyexchange/solidly/blob/master/audits/e456a816-3802-4384-894c-825a4177245a.pdf

Furthermore, the inherited codebase used by Velodrome Finance underwent a comprehensive security audit and peer review as part of the Code4rena bug bounty contest. Details of the audit can be found at: https://code4rena.com/reports/2022-05-velodrome/. Additionally, a thorough MythX deep scan was performed on the Velodrome contracts.

Velodrome Finance conducted a bug bounty contest from May 23rd to 30th, 2022, on Code4rena (Code4rena | Keeping high severity bugs out of production). The contest aimed to cover all the new changes to both the new and original contracts, with rewards of up to $75,000 available.

Solidly launched its bug bounty program in February 2022 on Immunefi.com. To date, no claims have been made for the offered $200,000 rewards. Details of the bug bounty program can be found on their GitHub page: (https://github.com/solidlyexchange/solidly/blob/master/SECURITY.md).

The Ramses team has been instrumental in the development and enhancement of this protocol since its inception over a year ago. We have contributed significantly to various improvements and have deep knowledge of the codebase, making us one of the most knowledgeable teams operating in this space.

While audits can sometimes be seen as primarily serving marketing purposes, we emphasize that our protocol offers both reputable brand name audits and a track record of over a year without any exploits. Additionally, our team possesses an exceptional understanding of the codebase, providing a strong foundation for security and reliability.

SECTION 5: Data and Reporting

Is your team prepared to create Dune Spells and/or Dashboards for your incentive program?:
Yes

Does your team agree to provide bi-weekly program updates on the Arbitrum Forum thread?:

Yes, we will provide bi-weekly updates that will display analytical findings/performance of the incentives program, $ARB liquidity enhancement, and other relevant information.

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

25 Likes

We have worked very closely with the Ramses team for months to help implement the ICHI automated liquidity manager as well as create a sustainable liquidity model for $RAM that will give these incentives more longevity and impact. We are very confident in the Ramses team ability to execute and be a good steward of this grant for the Arbitrum ecosystem.

11 Likes

Ramses is currently in the process of onboarding our team (oath.eco) to Arbitrum and has helped to illuminate a clear path to market for us. We appreciate their hard work as ambassadors of the Arbitrum ecosystem and admire their technical achievements.

Long story short, I can’t think of a better candidate for a grant like this, especially since it will be matched with their own incentives.

18 Likes

Ramses was the partner that onboarded Gravita’s GRAI liquidity on Ramses, and that convinced us to expand to Arbitrum as our first (and for now only) L2.

Their help in fostering our growth on the chain was remarkable. They are clearly committed to the growth of the space.

10 Likes

I’m generally supportive of grants for smaller native protocols, as I think it’s a general net positive for the ecosystem, but not in such a way.
Sorry if I’m being blunt but that’s one of the worst proposals I’ve seen over the last few days, and it really suffers when compared to the Balancer’s one from instance that I was reading just before.

We’re talking about a $1.7M grant for 3 months:

  • Ramses has 260k MarketCap, 4M FDV (https://www.coingecko.com/en/coins/ramses-exchange) and 7M TVL

  • I can see on your app there is currently $300 of RAM emissions to LPs / % of vote / epoch (I’m guessing weekly). That means $120k / month.
    Please correct me if I’m wrong, does that mean you would allocate $1.2M per month (approximately $600k ARB grant + matching protocols incentives) to veRAM voters, only to distribute $120k worth of emissions to LPs? How would this ratio make sense?

  • Most importantly, the entirety of the grant would go to the voters, aka the veRAM lockers, not to the LPs. That’s not a way to support the ecosystem, that’s only a way to support your own token.

I can sure get why protocols with large veRAM tokens allocations are interested since they would directly receive those huge ARB incentives when voting for their pools.

Even if I’m not really fond of solidly forks in general, I think it’s still a part of the defi space in general and it’s cool to have at least one on the chain. But there is no way we should support such a predatory proposal.

7 Likes

I think you are not getting how the solidly model works. The entire point is an expensive native token ($RAM) which drives up APRs for the LPs which in turn attracts liquidity. A flywheel of sorts.

5 Likes

First take into account this small tvl has still done 100m in volume in a month, and also remember bribe recycling, when a protocol votes with their own Nft, they take back most of their grants, you can see here

Users hold around 29% of supply, whilst Meaning 71% is recycled, so the real expenses in ARB are 200k per month at most, since protocols pay the other 600k out of pocket and 71% of the arb is recycled strictly into more bribes, I think you fail to take into account how effectively solidly model can take advantage of grants, as well, Ramses uses 25% of grants to incentive ARB liquidity, something very useful for the ecosystem as a whole, just my opinion though

4 Likes

Founder of Gravita here and we do incentives on Ramses, we’ve found that the Ramses model has been a really good deal for our LPs. But they get more out of it if they vote lock the emissions they receive rather than selling them.

10 Likes

From the Gravita perspective, Ramses has been an incredibly good partner to us and is doing great work in helping build liquidity for Arbitrum. In favor of this.

8 Likes

Thanks for the genuine criticism, you are not wrong in a lot of your points at all-- however, I believe some context can be added which might provide more insight on everything:

  1. the ask amount-- definitely, 2m is the max cap for the category we fit in; and we are not by any means saying 2m is absolutely necessary nor expected. We believe in open discourse and are more than happy to adjust based on the feedback given in this thread, such as yours. In regards to why we believe it is not an astronomically outlandish ask, is due to the nature of how our system operates. We are a Protocol for Protocols; hard stop. This is not ARB going to mercenary participants, but in fact the vast majority goes to Arbitrum ecosystem projects – which you can see on our partner’s list.

  2. Grant to voters vs LP – direct liquidity incentives via farming or pool2 rewards are statistically arguably the most ineffective method of distributing a governance token; which we all need to realize, the purpose of ARB is to be a token for ecosystem participants to enter governance with. ARB is not a dumping coin to enrich people, but rather a medium of membership/participation in the Arbitrum governing scene. Liquidity on Arbitrum via yield farming is not something that is desolate. You can find plenty TVL cooped up on plenty projects on the network. pool2 and yield farming incentives are only effective when the only goal is to stimulate TVL and deepen the underlying liquidity of a token, which ARB does not in-fact have a liquidity crisis on (like $OP did when their first grants came out).

  3. Grants, while not exclusively for innovation, should consider promoting an ecosystem’s “edge” and differences. There are lots of great projects that are native to Arbitrum, which we love collaborating with, who fit this category. We believe that the projects working hard and innovating daily will be the true silver-lining for the next wave of explosive growth in DeFi.

  4. Efficiency/metrics – we have been blessed to experience immense growth and bleeding edge efficiency with our novel take on both ve(3,3) and concentrated liquidity incentivization. For the foreseeable past, RAMSES has performed as the most efficient volume to TVL AMM on the network. This is strictly a technological edge, not any sort of financial incentive outside of regular means of operation. We believe TVL is important, but we also believe what is more important is useful TVL. The same can be said about volume, which can be artificially inflated/spoofed on honeypot tokens or other types of low-impact coins. Useful TVL and volume is the pinnacle of an AMM, which serves as the lifeblood of any DeFi ecosystem. RAMSES focuses strictly on usefulness and I believe we have achieved great strides in this manner.

I appreciate you taking the time to read and provide your input, and our team is more than happy to try and respond to any other concerns/questions you have to our responses.

10 Likes

Hey, BP from Gamma Strategies here, and happy to chip in my two cents for the Ramses team. They’re a very technical team who have implemented a lot of the best aspects of concentrated liquidity into their own AMM model which include dynamic fees and an incentivization model that favors extreme concentration and capital efficiency.

We’ve spent months working with their team, and they’ve been a pleasure to work with. They’re always available on Telegram when we need them, and they’re really taking this project seriously because they’ve spent a lot of time building it.

In terms of the grant itself, I do like the way they’re maximizing the use of their grant by using it as matching incentives vs. a straight incentive for voters. I hear what others have stated about the use of the ARB towards voters vs. LPs; however, the flywheel starts with the bribes, which attract demand for the tokens, which attract more liquidity. The matching is good way to be capital efficient with the grant funds as well as attract more ecosystem partners onto the Arbitrum ecosystem.

12 Likes

Thanks for all your answers, but I have to disagree with most of your points, and you didn’t address the most important part.

The grant you’re asking won’t go to Arbitrum ecosystem projects, it will go to veRAM and incentivize people to buy RAM and lock it, not to provide liquidity.

I’m not the biggest advocate of direct liquidity incentives, but your approach doesn’t solve anything, it’s actually even worse in terms of efficiency. Instead of using ARB as a direct liquidity incentives, you’re turning it into an artificial way to increase the price of your own liquidity incentives token.

That’s also the main criticism I have with Solidly forks using concentrated liquidity, as you’re artificially replacing natural incentives (fees) with your own token, so you can redirect the fees to the ve. Instead of taking advantage of clAMMs power to generate fees for LPs, you’re making the pool and its liquidity fully dependant of your token price action.

This other answer perfectly illustrates the point I’m raising:

If that is the case, you’re asking to fix something that obviously doesn’t work, which shouldn’t be the purpose of those grants.

Solidly forks have been thought to be “protocols for protocols”, but 99% of them turn into small stable farms/AMMs. Compared to other AMMs (Uniswap, Sushi, Camelot, Balancer…), could you share the part of your TVL and volume that belongs to protocols, and volatile vs stables?

The best illustration of this is how almost every Solidly fork can’t retain any consequent TVL over time, we had multiple examples of those on Arbitrum and most other chains.

That’s actually a concern, what would become this “recycled ARB” once the 3 month period has ended and isn’t controlled by the DAO anymore?

Don’t get me wrong, despite my criticism, I think you definitely deserve a grant as the largest Solidly AMM on Arbitrum, but imho it should follow a similar model to other programs like Balancer’s (incentives directed to LPs) and not with such a large amount.

Liquidity and volume (ie utility for the ecosystem) should lead to a positive token price action (ie positive outcome for the protocol), not the opposite.

9 Likes

His points have already been addressed but I will let others chime in. I don’t think he understands what they mean by Recycled ARB.

4 Likes

grants aren’t a prize for being the nicest guy around or a liferaft for down 99% bagholders, they’re intended to attract liquidity and volume to the chain as a whole. i agree w @Perl that Ramses should get a grant, maybe even a 2M one. but acting outraged instead of just discussing the valid points he raised is a bad look

4 Likes

These points are very insightful.

I was prepared to dissect this proposal on the value it brings to the Arbitrum ecosystem, as I personally believe that we will see the largest requests from both DEXs and perp DEXs.

However, the fact that this proposal gives all the ARB to veRAM holders is beyond absurd. This point alone makes me believe, in my own opinion, that it is specifically designed to benefit the team (the current largets veRAM holders) and a handful of partners that would be able to aggressively farm ARB.

This proposal is not about bringing in users or expanding the ecosystem, it is about maximising the amount of ARB that veRAM holders can farm. This does not benefit Arbitrum.

Some other points that make me generally unsupportive of this proposal:

  • Ramses does not offer deeper liquidity or more liquidity pools than other DEXs, and this proposal is not focused on expanding that or justifying Ramses market-fit on Arbitrum.
  • This proposal is entirely focused on being farmed, since all ARB will go to veRAM holders. This does not benefit Arbitrum or bring in new users or projects.
  • Ramses has already confirmed its expansion to Mantle and Base, I struggle to see their commitment on Arbitrum when price and TVL is down over 90%.
  • The concentration of veRAM holding is highly concerning. However, this would explain the structure of such a proposal, which entirely benefits this handful of people (the team and several partners) that hold all of the veRAM.

Ramses has a market cap of less than 300k and has failed to stop its decrease in TVL for months. 2m ARB that would go entirely to veRAM holders would not provide any value to the Arbitrum ecosystem and is a predatory way to construct a proposal.

For these reasons, I will be voting AGAINST.

6 Likes

Ramses is one of those projects that doesn’t have too many special features.

The project’s TVL has decreased sharply, the project’s token price has also decreased by 96% according to CoinGecko

Clearly this is not a project we should place our trust in

6 Likes

**deleted previous post as I made similar points below as reply to other users instead

  • Ramses does not offer deeper liquidity or more liquidity pools than other DEXs, and this proposal is not focused on expanding that or justifying Ramses market-fit on Arbitrum.

Ramses literally has the best volume efficency per unit of TVL in whole Arbitrum, essentially any grant that increases its TVL would promote the deepest liquidity possible (as consequence of having an average much tighter range than UniswapV3 thanks to its incentive model)

  • This proposal is entirely focused on being farmed, since all ARB will go to veRAM holders. This does not benefit Arbitrum or bring in new users or projects.

3/4 of the veRAM is high-integrity Arbitrum ecosystem protocols. This argument makes no sense. These protocols will now invest more money and bribe bigger to match the grants.

  • The concentration of veRAM holding is highly concerning. However, this would explain the structure of such a proposal, which entirely benefits this handful of people (the team and several partners) that hold all of the veRAM.

“Handful of people”

  • Alchemix
  • FRAX
  • Liquity
  • GAMMA
  • Radiant Capital
  • Swell
  • Vela Exchange
  • Yearn
  • LayerZero
  • Olympus DAO
  • Gamma Strategies
  • Ankr
  • Kyber
  • Angle
  • Beefy
  • The ByteMasons
  • Axelar
  • Ethos Reserve
  • Odos
  • DAOMaker
  • DEUS
  • Gravita Protocol
  • Firebird
  • Gains Network
  • GMD Protocol
  • Granary
  • Yield IQ
  • Ichi
  • GND
  • Inverse Finance
  • Jarvis Network
  • Liquid Driver
  • Muon
  • DefiEdge
  • Overnight Finance
  • QiDAO
  • 1inch
  • Root
  • SHRAP
  • Paraswap
  • Tarot
  • SYMM I/O
  • The Ennead
  • UNIDEX
  • xCAD
  • Davos
  • YFX

Ramses has a market cap of less than 300k and has failed to stop its decrease in TVL for months. 2m ARB that would go entirely to veRAM holders would not provide any value to the Arbitrum ecosystem and is a predatory way to construct a proposal.

TVL is the worst metric to value a DEX, only thing that matters is volume and fee generation. UniswapV2 dexes can gather a lot of TVL while having 99% of its liquidity being idle being literally useless, does that make it good? Ramses “lost” TVL in your view, but it has increased its volume to record ATH month by month by switching to more efficient CL and UniV3 model despite TVL “decreasing” ($100m of uniV2 TVL is barely equivalent to $5m of highly concentrated CL in terms of volume).

Secondly, checking RAM token metrics doesn’t make any sense. 100% of revenue is shared with lockers (veRAM). Ramses is one of the very few AMMs that is generating at least as much revenue as it emits, reaching neutral inflation in terms of revenue. It would be much more fair if you cared about veRAM metrics instead in terms of valuing the token.

When analyzing a DEX I suggest you take a deep dive on the metrics that really matter, which is mostly how much revenue it generates vs how much it emits and how much volume it generates for the chain, and also check how fairly is that revenue distributed.

Respectfully.

6 Likes

I don’t really agree with your proposal that LP bribes would be more efficent than vote bribes. In fact I believe this is exactly what this model solves. Just giving out rewards to a pool2 is very inefficent, it just goes to LPer as rented liquidity and thats it.

The whole point of the Arbitrum grants is to promote ecosystem growth right? Ramses has 40 partner protocols, which will compete to bribe bigger to access those grant matches (the so-called “flywheel”). These protocols will also recycle some of it again, which they can bribe again next week. This might also attract more partners to join, participate, or try to adquire veRAM positions to participate in this “grant distribution marketplace”. Essentially, people and protocols must compete for the grant, bringing better efficency than just giving out free ARB to LPers in a pool2.

Personally, I wouldn’t even mind what you are proposing – 100% of the grant goes directly to ARB/USDC and ARB/ETH pair as direct LP bribe, which would increase ARB pairs volume and revenue tremendously, but again, maybe you aren’t aware that 80% of that fee revenue would be going to veRAM lockers still. The grant program is also suggesting that 1/4 of the grant will go directly to these pairs too anyway.

The Solidly model via vote bribes is an excellent model for grant distribution. We have a very good precedent of how it went with Velodrome and Optimism grants, which after many months, they keep incentivizing huge, so it seems they are happy with the model (even though they have a inferior UniV2 AMM that generates much less volume than what Ramses can do nowadays).

5 Likes

@North @Perl You guys are in token terminal ?
Will it impact cdp market ?
Is Gravita Protocol is gone get grant too ?

Does @Camelot grail is the same grail or or different grail of gravita protocol.

1 Like

Good Morning - Alex from the Velodrome Team here.

I’ve known the Ramses Team for some time, am very familiar the primitive, and know just how impactful it can be when combined with incentives to boost an ecosystem. Figured I’d add some thoughts here especially as much of the conversation here feels like a repeat of what we’ve seen in the OP ecosystem. As a disclosure, I own no RAM or ARB so these are just my own musings fwiw.

Framing Grants
On the Optimism Governance side of things, we’ve learned a lot from going through multiple rounds of grant funding. There are a few things I’d call out as Arbitrum delegates are considering proposals here:

  • Prioritize Public Goods: If a project take team fees on the underlying protocol activity and/or is already backed by VCs or outside funding be wary. Support systems that return 100% of the value creation to ecosystem participants.
  • Prioritize Native Projects: Multichain projects have different incentives than native ones whose success is 100% tied to that of the chain, some will even ship the value created right off of Arbitrum reducing the impact of the programs. Support focused native projects, they’ll deliver you back multiples more in impact.
  • Support Projects Building Actual DeFi: Plenty of projects are willing to take shortcuts, deploying risky upgradable contracts or retaining their teams ability to manipulate things like token emissions. Support projects that deploy permissionless immutable contracts and decentralize protocol control.
  • Reward Demonstrated Impact: If protocols already received a large ARB airdrop and are asking for more, make them demonstrate the impact of what they’ve been given to date. If it is marginal or has been misused, be wary of providing more without data to support program efficacy. Take some risks on projects that haven’t received any, but only give them more if they prove impact.

Liquidity Incentives
In the early days of grants on Optimism, a lot of token rewards were granted for direct liquidity incentives. This is now broadly seen as a mistake as they produced marginal impact and distributed the rewards to the single most mercenary group of farmers: Liquidity Providers.

What has found to be far more effective is using rewards to incentivize the investments of other protocols in the ecosystem (through things like voting incentive match programs) and distributing the rewards to groups more likely to be aligned with the long term success of the ecosystem (like veRAM lockers who’ve made a 4y commitment to Arbitrum).

To put this more tangibly, you can give $1 in ARB to rent the $1 worth of TVL from a mercenary farmer (that will be gone the minute the program ends) or you can give $1 in ARB to attract $8 - $10 incentives from other protocols while still return $12 to $3 to LPs… all while ensuring the ARB is going only to those who’ve made multi year commitments to the ecosystem.

This a proven effective approach on Velodrome.

Performance to Date
I don’t think it makes a ton of sense to hold token price or TVL metrics against Ramses when considering a growth experiment such as this. There are plenty or projects and protocols on Arbitrum that are exceptionally well funded and got massive ARB airdrops on top that Ramses has had to compete with… meanwhile, I think there are strong signals in things like their fees / emissions, volume / TVL that suggest that with the kind of support a grant like this could help kickstart a similar flywheel effect to what we’ve seen on Velodrome.

If the size, duration, or current concentration of veRAM supply is an issue for any major delegates I’d encourage the team to find a way to modify the proposal to meet their needs – but I think the DAO should strongly consider making a bet on this team, especially if incumbents and vc backed multichain protocols will be heavily supported, so they can have a fighting chance to prove their potential. Worst case it doesn’t work and you don’t need to give them anymore. Best case, you get a Velodrome style growth explosion on Arbitrum.

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