Project Description: Silo Finance is a non-custodial lending protocol that creates isolated credit markets for any token asset. In contrast to other lending markets, our lending markets are risk-isolated by design, enabling lenders to modulate risk on an asset basis by choosing the collateral they are exposed to. Our vision is to be the base-layer, permissionless lending protocol for all token assets.
Team Members and Qualifications: [List team members and their qualifications, roles, and responsibilities]
The core contributors team consists of the following members:
- Shadowy Edd: Smart Contract Lead
- Ihor: Senior Smart Contract Engineer
- Neo Racer: Senior Smart Contract Engineer
Front-End & Design
- Siros Ena: Front-End Lead
- Tyko: Senior Front End Engineer
- Andrew: Product Design Lead
- Alex: Researcher & Mathematician
- Anton: Researcher & Mathematician
Growth & Ops
- Aiham: Growth Lead
- Tenzent: Business Development Lead
- Chutoro: Content, Socials, and Marketing Lead
- Augustus: Operations Lead
Grant Matching: The equivalent of 1M $ARB in $SILO tokens as part of the Silo V2 launch (pending DAO’s approval). The DAO plans to launch Silo V2 on Arbitrum before any other chains.
- Stream incentives to lending markets: 1M ARB summarized below (read the full distribution framework [here].(Grant distribution framework - WIP - Google Docs)
|Market / Incentivized action||Base asset deposit||USDC deposit||USDC borrow||ETH deposit||ETH borrow||Total allocation|
Funding Address Characteristics: 3/5 Safe - controlled by Silo Finance’s core team
The core team will deploy a new incentive controller similar to (arb1:0x4999873bF8741bfFFB0ec242AAaA7EF1FE74FCE8) that distributes $SILO incentives to lending markets.
Our primary objective of the grant is to stimulate deposits and utilization of existing markets, while focusing on creating sustainable network effects around deposits that do not rely on long-term incentives.
We believe there are dozens of token assets, including new stablecoins and derivative assets, that need lending markets as part of their growth cycle.
Key Performance Indicators (KPIs):
To track success, we will use three primary metrics:
- Borrowed TVL in existing lending markets
- Borrowed TVL in newly-launched lending markets
We believe Arbitrum can benefit in four major areas:
- Security-First Lending: Silo allows users to modulate risk on a per-asset basis by allowing lenders to select what collateral can be used to borrow their tokens. This means users can personally control their risk exposure and conduct safe lending practices.
- Lending Markets for All Tokens: By design, Silo Finance can create lending markets for any token assets. Our commitment to this goal is evident in our support for tokens such as $rDPX, $JONES, and $PREMIA etc. that are not available elsewhere.
- Attracting TVL: Lending markets in themselves drive capital efficiency by giving users access to liquidity without losing exposure to their tokens. By incentivizing TVL on Silo Finance, we aim to drive deep lending liquidity that will contribute to the growth of Arbitrum TVL and its user base.
Silo Finance was the first lending protocol to launch a lending market for the $ARB token. To date, the SiloDAO has streamed over 1M $SILO (> ~$65,000 then) to the $ARB lending market, building the deepest isolated lending market for the token with $6M TVL across $ARB/$ETH/$USDC.e.
The $SILO incentive program covers other isolated lending markets such as GMX, DPX, wstETH, and rETH. This program is financed by SiloDAO and has contributed significantly to creating deep lending markets that see consistent utilization of deposited funds.
1M $ARB will allow us to scale lending both horizontally and vertically by creating new lending markets as well as increasing activities in existing ones.
100% allocated to incentivizing deposit/borrow actions in 16 isolated lending markets that meet the following criteria:
- Resilient oracles for all underlying assets in the market
- Sufficient DEX liquidity
Read the distribution framework here.
We will stream bi-weekly incentives to users depositing/borrowing passively.
Any $ARB that is not distributed will be returned to the Arbitrum Foundation.
We plan to distribute the incentives linearly over 3.5 months period, starting October 15, 2023 and ending January 31, 2024.
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?
Provide details about the Arbitrum protocol requirements relevant to the grant. This information ensures that the applicant is aligned with the technical specifications and commitments of the grant.
Silo Finance was initially launched on Ethereum Mainnet. SiloDAO is set to launch Silo V2 on Arbitrum first to become an Arbitrum native protocol.
8 February 2023
Silo v1.1 was launched in August 2022 on Ethereum Mainnet and has a secondary mainnet deployment known as Silo Llama as well as Silo Arbitrum. Our total TVL across all markets is $98m with $15.3m TVL on Arbitrum alone.
Since our deployment on Arbitrum, we have grown to be the largest risk-isolated lending market for $ARB with $6.4m TVL. Additionally, we have supported the launch of lending markets for Arbitrum-native tokens such as $MAGIC, $Y2K, $JONES, and $PREMIA which are not available on other platforms.
We have integrated lending market support for Curve LP tokens on Silo Ethereum and believe Arbitrum is home to a broad range of composable products where similar integrations would be suitable - this could include markets for GMX and Camelot LP tokens. Silo has also been used as the base layer lending market for other Arbitrum protocols including FactorDAO and Nitro Cartel.
Silo currently runs a co-incentive program on Silo Arbitrum where we match incentives from partner protocols such as Dopex, GMX, and Gainstrade. Incentives have played a key part in the success of our Arbitrum deployment and we believe a grant will allow us to drive deep lending liquidity and capital efficiency for the ecosystem as a whole.
Silo V2 is an upcoming upgrade to the Silo protocol scheduled for Q4 with plans to deploy on Arbitrum first. It is a reconceptualization of the original Silo design that will maintain our risk-isolated architecture while supporting a more extensive variety of tokens and significantly improving capital efficiency. It also includes a veSILO tokenomics upgrade allowing locked $SILO to vote for $SILO emissions gauges on Arbitrum.
We regularly release new markets for tokens and are proud to say we are the only protocol that has a market for $rDPX, $rETH, $GNS, $JONES, $PREMIA, and $Y2K. As the Arbitrum ecosystem grows, we will happily extend support for all suitable tokens.
- Silo v1.1 Smart Contract Audit (ABDK)
- Silo v1.1 Smart Contract Audit (Quantstamp)
- Silo Curve Convex Token Market Smart Contract Audit (Chainsecurity)
- Silo v1.1 Formal Verification Testing (Certora)
- Chainlink Price Provider Formal Verification Testing (Certora)
Provide details on how your team is equipped to provide data and reporting on grant distribution.
Silo Finance will report on the following aspects:
- Quantitative: Creating a custom dashboard to track incentives distribution and impact on stated success metrics;
- Qualitative: Describing any change in distribution methodology for optimization purposes and the results of such changes.
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?: