For reference:
State of the Treasury : https://synapse-treasury-frontend.vercel.app/
Monthly Syn emissions : https://synapseemissionsdashboard-3d76b3202ae7.herokuapp.com/
Overview:
All fees paid by the protocol are denominated in ETH, it being the token that is sent or bridged across chains to the various contracts for the payment of gas directly on mainnet and L2s, or for the purchase of the native gas tokens to be used similarly in case of alt-L1s
In our ongoing effort to enhance protocol economics, I propose that we swap out all tokens (in batches) held in our treasury that are not actively utilized in daily operations of the protocol, whether accumulated as bridge fees or otherwise (excluding the ones earmarked for specific reasons or stablecoins), and converting them into ETH.
Excess unutilized ETH should then be used in our pools to deepen bridge liquidity until needed for gas expenses, while simultaneously reducing SYN spend for the pools where POL ETH is added.
Motivations:
- Increasing Protocol owned liquidity efficiency
- Having a predictable supply of ETH which can be called upon when needed for gas expenses
- Deepening of liquidity on our ETH pools
- Further reducing and accelerating path to zero emissions.
Implementation:
- Swap OP for ETH
- Swap gOHM for ETH
- To avoid negative slippage, consolidate ETH holdings on mainnet by the use of native bridges wherever applicable
- Swaps will be done on-chain to be executed within two weeks after passed proposal
- Swaps should not result in more than 1% slippage; if this is the case, protocol will TWAP sell over a few days to smoothen the impact
- 50% of all treasury holdings will then be deployed as stablecoin and ETH liquidity in our owl pools, targeting chains with the highest volumes
- SYN Emissions cut accordingly to reflect the increase in TVL
Notes:
- This is a draft proposal that is to be given better shape after community discussions
- ARB has been left out of this as there already exists a prior passed proposal that deals with it
- GMX has been left out of this to facilitate community discussion about whether it should be included in the swaps or it should be staked to earn ETH on their protocol
