CONTEXT
Synapse played a major role in bridging volume to Arbitrum, and as a result the DAO received 1M ARB ($1.25M USD). With Synapse's rollup inching closer, it makes sense to set up a developer incentive fund to kickstart dApp development, especially when competing with other multichain solutions such as Layer Zero. Synapse DAO could sell an agreed upon portion of its ARB holdings to buyback SYN that can later be redistributed through a developer incentive program.
This post is simply to start a discussion around a Synapse Ecosystem Fund and potential ways to bootstrap this fund. "Build it and they will come" is not a viable go to market strategy to attract developers. Synapse's rollup has massive potential, and the DAO should take initiative to generate momentum from the day the rollup is deployed.
There is no operational purpose for the DAO to hold its ARB tokens, and these funds could better be used to help create a vibrant ecosystem on Synapse's own rollup. The sale of ARB would not adversely impact Arbitrum's price, given the token has ample liquidity across multiple trading venues. At the date of this post, SYN is relatively cheap when compared to its competitors. This presents an opportunity for the DAO to purchase incentives for a low price, and distribute assets in a way that more closely benefits Synapse. Actual structure of the sale and purchase of tokens can be discussed in more detail if this proposal passes.
Proposal
The Synapse DAO would sell anywhere between 50% to 100% of its ARB holdings (1M ARB). Similar action can be taken with Synapse's OP holdings.
These funds would then be used to purchase SYN and set aside for a Synapse Ecosystem Fund.
Actual facilitation of such treasury actions would be carried about the Synapse DAO multisig. Actual parameters and timing of the treasury actions would be further discussed if this proposal passes.
The Synapse Ecosystem Fund could award grants to promising teams who aim to deploy dApps on the Synapse Network. This structure could follow something similar to Canto's Online Hackathon, which has successfully linked teams with funding to create dApps to further the Canto ecosystem.
Expected Benefits
This proposal could lead to the following benefits for Synapse:
A diverse ecosystem of dApps on day one of Synapse's Network launch, leading to more usage of the Network
Strong incentives for talented developers to deploy groundbreaking dApps on the Synapse Network that showcase unparalleled capabilities when compared to other networks
Support for Synapse's valuation that more closely mirror the protocol's strength
A vote "For" of this proposal approves the decision. Specifics of the transaction could then be discussed in a separate proposal.
A vote "Against" this proposal rejects the decision.