[PIP-6] Reallocate Liquidity to Optimism & Product Research

Summary

Outlined below is an executive summary of the strategy to reallocate POP/USDC liquidity from Ethereum and Polygon to Optimism for growth purposes. For further detail, look at RFC 3 [Link]. Thank you @alec for summarizing the RFC.

Action steps:

Desired outcomes:

  • Efficiently grow liquidity on Optimism using protocol incentive programs
  • Fund strategic R&D through Alpha Research Group (ARG)
  • Protocol growth ultimately contributing to Popcorn’s ability to scale the social good grant program

Motivation

Optimism and Popcorn are mission aligned:

  • Optimism implemented the RetroPGF initiative to “level the playing field between profit-maximizing startups and nonprofit/OSS projects.” This initiative invited community members to nominate projects and has delivered $1M+
  • Popcorn allocates a portion of fees to a social good grant reserve, and enables POP holders to use DAO governance to elect and select organizations. To date, Popcorn has distributed funds to Unicef Cryptofund, Pathways to Education, Panthera, Rhino Ark Foundation, and Rock Your Life

Shared sustained growth through bear market:

  • In 2022, while the overall DeFi TVL has decreased from ~$205B to ~$60B (-~71%), Optimism’s TVL has increased from ~$350M to ~$965M (+~275%) and has attracted 79 DeFi projects
  • Popcorn has amassed a TVL of ~$3M, expanded to 4 chains, launched on a centralized exchange, and collaborated with a major brands and protocols to support the mission of social impact and web3 fundamentals

Strategy/Approach

Reallocated liquidity from Ethereum and Polygon will fund two growth initiatives:

(1) Alpha Research Group (ARG):

  • Dedicated Popcorn R&D organization focused on Optimism product development:
    • Single-asset vault strategies
    • Multi-asset vault strategies
    • Yield bearing stable and non-stablecoin products
    • POP & OP rewards to incentivize liquidity

(2) Build POP Optimism liquidity:

  • Uniswap
    • The most immediate option would be to migrate USDC/POP liquidity from Ethereum and Polygon to an equivalent pool on Optimism.
  • Velodrome
    • Utilizing Velodrome incentives, build liquidity in a POP/stablecoin pool on Velodrome through bribes, voting, and incentive matching (see RFC 3 for more detail)

Summary

Migrating protocol-owned liquidity to Optimism, along with applying for an Optimism OP grant, will allow Popcorn to efficiently incentivize liquidity and fund R&D for strategic purposes. These initiatives will lead to protocol growth and ultimately contribute to Popcorn’s ability to grow the social good grant program.

Please indicate if you approve or disapprove this proposal.

  • Approve
  • Disapprove

0 voters

1 Like

Great proposal. So the Alpha Research Group will be created and run by Popcorn?

ARG will be managed by Popcorn, yes.