SECTION 1: APPLICANT INFORMATION
Applicant Name:
Wormhole Foundation
Project Name:
Wormhole Foundation
Project Description:
The Wormhole Foundation is dedicated to supporting open-source, decentralized technologies that securely and seamlessly connect Web3.
The Foundation is the steward of Wormhole.
Wormhole is a cross-chain messaging protocol, and supports Circle’s Cross-Chain Transfer Protocol (CCTP) for minting and burning native USDC for cross-chain transfers. Across all of its products, Wormhole has transmitted over 620 million cross-chain messages and tens of billions in token transfers.
Team Members and Qualifications:
Wormhole Foundation is one of several contributors to Wormhole. Other contributors include xLabs, Jump Crypto, 19 Guardians – comprised of the leading validator companies (e.g. Staked, Chorus One, Figment) – and two more Labs teams that will soon be publicly announced. The Wormhole Foundation will handle the execution of this grant.
Team members:
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Dan Receer – Operations at the Wormhole Foundation. Prior to Wormhole, Dan was Chief Growth Officer at a leading Polkadot-based parachain Acala for two years and spent two years in a Growth role at Web3 Foundation where he contributed to the launch of Polkadot. Before Polkadot, Dan led marketing for Wanchain and also spent four years on global healthcare brand teams at Eli Lilly & Company.
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Robinson Burkey – Strategy at the Wormhole Foundation. Robinson has dedicated nearly a decade to leading growth for early to mid stage companies. Prior to joining the Wormhole Foundation he led BD and Ecosystem Programs at Acala in the Polkadot Network. Before Acala, Robinson was an early leader at DoorDash where he spent four years on growing new business verticals across North America.
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Cathy Yoon – General Cousel at the Wormhole Foundation. Prior to joining Wormhole Foundation, Cathy was the Chief Legal Officer at MPCH Labs, a venture studio focused on applications of multi-party computation. She has also held roles as the general counsel for The INX Digital Company, Inc., co-head of the fintech and blockchain practice group for a major law firm, the general counsel for a blockchain advisory firm and its affiliated broker-dealer and as managing director and senior counsel at The Bank of New York Mellon.
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Maher Latif – Research at the Wormhole Foundation, leading protocol and mechanism design research. Prior to joining the Foundation, Maher spearheaded research initiatives at Jump Crypto and with the Money Markets group at the Federal Reserve Board.
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Nikhil Suri – Nikhil Suri - Product Lead at the Wormhole Foundation, leading product/engineering efforts. Prior to the Foundation, Nikhil was an engineer at Jump Crypto, where he worked on initiatives such as Silo, the leading open source custody solution. Before Jump, Nikhil helped build global payment systems at PayPal, and got his start in crypto interoperability working on the Interledger Protocol.
Project Links:
Wormhole: https://wormhole.com/
Portal USDC Bridge: USDC Bridge: Native Cross-Chain USDC Transfers
Cross-Chain Transfer Protocol: Cross-Chain Transfer Protocol (CCTP) | Circle
Contact Information:
TG:
Twitter:
Email:
contact@wormhole.foundation
Do You Acknowledge That Your Team WIll Be Subject to a KYC Requirement?:
Yes
SECTION 2: GRANT INFORMATION
Detail the requested grant size, provide an overview of the budget breakdown, specify the funding and contract addresses, and describe any matching funds if relevant.
Requested Grant Size:
1,800,000 ARB maximum
Grant Matching:
N/A
Grant Breakdown:
This grant targets the importation of 100,000,000 USDC to the Arbitrum economy. Rewards target an ~5-8% annualized rate of reward for users that utilize Circle’s Cross-Chain Transfer Protocol (CCTP) through Wormhole and its partners to mint native USDC on Arbitrum.
~5-8% is chosen because it is competitive to real-world and DeFi alternatives such as Coinbase USDC rewards and the DAI Savings Rate at MakerDAO, while still reflecting the relatively low level of risk to users.
This reward is meant to be available for a maximum of 3 months, and accrue weekly. That translates into a maximum 2% total return for users over the course of 3 months. At the time of writing, 1.8m ARB is required to provide that for 100m USDC.
Users that utilize Wormhole and its partners to mint USDC with the CCTP and hold their USDC will be eligible for ~5- 8% rate of return, with reward accruing every 7 days. This reward period will span 12 weeks (approximately 3 months). Users will be free to move their USDC if they choose, but only USDC held in their bridged address will be eligible to accrue rewards as a mechanism to prevent abuse of the bridging subsidy.
At the end of the 12-week rewards period, unaccrued ARB rewards will be returned to the Arbitrum DAO Treasury address (0xf3fc178157fb3c87548baa86f9d24ba38e649b58). Note that users may choose not to claim their ARB rewards within the 12-week window for various reasons, and that accrued rewards will remain in the distribution contract for at least 365 days, at which point the unused portion will be returned to the Arbitrum DAO Treasury address.
Funding Address:
0x101A6a3049F9CDFC4C289A9A0A0E38449AdB8327
Funding Address Characteristics:
This is a 2/3 multisig with private keys securely stored.
Contract Address:
To be determined.
SECTION 3: GRANT OBJECTIVES AND EXECUTION
Clearly outline the primary objectives of the project and the Key Performance Indicators (KPIs) used to measure success. This helps reviewers understand what the project aims to achieve and how progress will be assessed.
Objectives:
The objective is to onboard 100,000,000 natively issued USDC from other chains.
Key Performance Indicators (KPIs):
The single goal of this grant plan is to incentivize 100,000,000 USDC to migrate to Arbitrum from competing ecosystems over a 12-week period, and should be judged on whether that goal is met.
How will receiving a grant enable you to foster growth or innovation within the Arbitrum ecosystem?:
This grant allows for targeting USDC users in other ecosystems to migrate their assets to Arbitrum. Alternatively, it also provides an incentive for users holding USDC.e to bridge back to Ethereum and re-enter Arbitrum with native USDC, which will speed up the migration from one asset to the other and shorten the period of liquidity fragmentation between the two versions of USDC.
Justification for the size of the grant:
This grant targets the importation of 100,000,000 USDC to the Arbitrum economy. Rewards target an ~5-8% annualized rate of reward for users that utilize CCTP through Wormhole and its partners to mint native USDC on Arbitrum. This reward is meant to be available for a maximum of 3 months, and accrue weekly. That translates into a maximum 2% total return for users over the course of 3 months. At the time of writing, ~1.8m ARB is required to provide that for 100m USDC.
Execution Strategy:
Wormhole will track USDC minted onto Arbitrum via Circle’s CCTP. Addresses where the USDC remains in the minting address on Arbitrum will be eligible for rewards. A distribution contract will be updated weekly with ARB token rewards, and the allowance for each address.
Grant Timeline:
From time of first tranche receipt, estimated timeline:
- Announcement of rewards program and building awareness: 2 weeks
- Build, test, deploy rewards contract & UI: 1 week (concurrent with above bullet point)
- Incentive period: 12 weeks
- Prepare report on grant plan results: 4 weeks (requires 30 days’ data post grant)
If this proposal is greater than 1M ARB, please provide details on any funding tranches or milestones your application aims to abide by:
Milestone Descriptions:
| Milestone Goal | Milestone Metric | Source of Truth |
|---|---|---|
| Migrate 40,000,000 Total USDC | 40,000,000 native USDC is minted on Arbitrum through Wormhole and its partners via Circle’s Cross-Chain Transfer Protocol | 0x2703483B1a5a7c577e8680de9Df8Be03c6f30e3c; USDC minted with CCTP via Wormhole |
| Migrate 80,000,000 Total USDC | 80,000,000 native USDC is minted on Arbitrum through Wormhole and its partners via Circle’s Cross-Chain Transfer Protocol | 0x2703483B1a5a7c577e8680de9Df8Be03c6f30e3c; USDC minted with CCTP via Wormhole |
| Migrate 100,000,000 Total USDC | 100,000,000 native USDC is minted on Arbitrum through Wormhole and its partners via Circle’s Cross-Chain Transfer Protocol | 0x2703483B1a5a7c577e8680de9Df8Be03c6f30e3c; USDC minted with CCTP via Wormhole |
| Follow up report on results | Provide a report summarizing the results of the grant program | Arbitrum governance forum |
SECTION 5: PROTOCOL DETAILS
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.
Is the Protocol Native to Arbitrum?:
Wormhole has integrated 29 different blockchains, including Arbitrum
On what other networks is the protocol deployed?:
A full list of the 29 chains integrated by Wormhole can be found here.
What date did you deploy on Arbitrum?:
Wormhole deployed to Arbitrum in July 2022.
Protocol Performance:
The Circle Cross-Chain Transfer Protocol has successfully bridged more than 130 million USDC to Ethereum alone. Avalanche, which already hosts a smaller concentration of native USDC than Arbitrum, has successfully bridged more than 50 million USDC, suggesting that 100 million for Arbitrum should be possible given the larger ecosystem and incentives.
Wormhole (and its token bridge, Portal) is a top 10 cross-chain transfer/messaging protocol. It also was one of only two bridges to receive a passing grade in the Uniswap Bridge Report, and is trusted by Uniswap governance to provide cross-chain governance messaging.
Protocol Roadmap:
Wormhole’s strong solution to the bridging trilemma earned it the top spot in the Uniswap Foundations Bridge Assessment Report. However, Wormhole is continuously looking to improve its trust assumptions and looking to ZK as an additional security measure atop a validator set. Tentatively, the Wormhole ZK roadmap expects the first live production milestone for light clients in Q1 2024.
Audit History:
Wormhole has had numerous audits and boasts a large bug bounty. For full information, please find that here.
SECTION 6: Data and Reporting
Provide details on how your team is equipped to provide data and reporting on grant distribution.
Is your team prepared to create Dune Dashboards according to program requirements for your incentive program?:
Yes, or a publicly available equivalent.
If not, how does your team plan to report grant data?:
A Dune dashboard is likely to be how information is publicly reported.
