Airdropping to DeFi DAOs

Summary
In an open source arena like DeFi, it is critical that Barnbridge builds as many social and economic moats as possible to minimize the risk of a competitor eating into its market share. While the core team is personally close and now collaborating with some of the leading teams in DeFi, we need to think of N2N - network to network - relationships as well. In the future that may look like co-hosted meetups in person or digitally, but such relationships should first be founded on real on-chain alignment. As such, I propose that we allocate between 1 and 5% of BOND to the treasuries of various leading DeFi projects.

Description

  1. Determine which treasuries are worth seeding
  2. Determine how much of BOND supply to allocate
  3. Create Discord channels for each relationship
  4. Coordinate monthly cross-community calls

Motivation
Treasuries holding BOND would be more inclined to integrate with Barnbridge and less willing to explore future competitors. More practical DAOs could use their BOND in future Smart Alpha products and earn income to fund their own work as well.

Technical details
BOND would be distributed via a vesting smart contract over the course of two years.

Useful Links
Behind a paywall but Delphi Digital has explored DeFi treasuries in the past: https://www.delphidigital.io/reports/a-look-into-public-defi-treasuries/

Argumentation
For: Aligns projects with Barnbridge, doesn’t require us to give it all upfront, gives projects a reason to use our app if they sit the asset in Smart Alpha

Against: Not an immediately productive use of our treasury, some community members may be upset with the % allocation voted upon, and it doesn’t guarantee that other networks won’t take a mercenary approach with future Barnbridge competitors

DAO Vote
TBD

The goal of this thread is to a) determine community appetite for such a decision, b) determine a consensus-best allocation to airdrop to project treasuries, and c) assess which projects are best suited for such a relationship. I’ll look to make a Snapshot proposal after ~one week of debate here.

11 Likes

I like the idea, as we definitely need to get external entities to have stake in our platform. Otherwise, the risk is that they start using competitors.

There are two possibilities, in my opinion:

  • The first one being that protocols would receive the tokens through a stream thanks to Sablier.
  • or we could stake and lock these tokens up for them in governance so we make sure they can’t sell them for a certain period of time, and this gives them an important voice in the decision-making process of the BarnBridge DAO.

Whatever ends up being done, if something is done, it’s important that these protocols receive stake on a sufficiently long-term basis to increase their bond (intended wordplay) with BarnBridge.

4 Likes

I like the idea but I think we should tie it to specific actions taken that benefit the Barnbridge DAO. So we can allocate X amount to a pool that vests over the 2 year period you suggested.

So would rather use it as an incentive for an action taken rather than a gift to induce a potential action.

Some examples of potential actions:

  • Integrations of any kind that leverage our smart contracts
  • Enabling distribution of BB tokens on your platform or building an interface
  • Proof of investment in $BOND or BB Pools by entity or DAO attached to a project
  • Other meaningful partnerships
13 Likes

I like the integrations idea. It could be coupled with some requirements where the protocols would lose their stake if they integrate a competitor for example (maybe a bit too extreme, not sure).

And it would probably become some kind of incentive too for platforms to adopt BarnBridge (who doesn’t want free money just for integrating a product?), aside from ensuring they don’t integrate competitors.

1 Like

I don’t think we should legislate exclusivity. I like the idea of streaming the bonus over a vesting period based on maintaining the partnership requirements

Projects should be free to work with anyone on the merits of the opportunity to them and not be unduly locked in based on our agreements.

4 Likes

I agree with Akin—we should reward integration rather than gift tokens and hope for a desired response. Perhaps have milestones based on value (or percentage) of treasury invested in Sr tranches entitles a certain reward in BOND tokens.

1 Like

If I may grace the new forum with my humble opinion on the matter.

My First Thoughts
I do believe in trying to get market shares before our competitors, but I also believe we must be careful with our finite supply of valuable bond tokens. I am not in favor of airdropping individuals tokens, outside of the community, without them first proving their value to barnbridge. It belittles the voting power of those that believed earlier and spent money to be part of the DAO. I believe the products will speak for themselves. If the products created deliver on their promises, the value will speak volumes. Companies and people follow results, quality and money. If the protocol makes people money - more people will come.

The Most Pressing Issue
I believe the greatest threat to Barnbridge and us gaining market shares is ETH gas fees. The gas fees are currently limiting the use of the protocol, and therefore limiting the protocol’s exposure and growth to new users/adopters. The new competitors that are building on Polkadot will be a major threat because of interoperability and low gas fees. There are competitors like Reef and APY.finance coming around the corner, so I believe that refining the products and making them usable is key. Additionally, we may need to look into moonbeam or other block-chain bridging systems to future proof the DAO, but addressing the gas problem is paramount.

Marketing Suggestion
As far as marketing and creating exposure, I would rather see people rewarded for referrals to the protocol. Maybe we could create a referral program like 1inch or create incentives that cultivate a more organic exposure to our products we offer. We should airdrop the people that want to help and reward community activity and influencers. I believe there is power in numbers. The more people we can incentify and get talking about burnbridge the faster the growth.

2 Likes

I couldn’t agree with you more. Airdrops of tokens to other project parties must bring more value than tokens, not free airdrops. This is an infrastructure problem. We should not think too much about it. What we should talk about is how to make the bond more attractive. I also agree with your marketing almost, using the way to pull new incentives! It’s almost viral marketing

1 Like

Yes, it has to be a value swap

This sounds like a good idea, however it hinges on a key hypothesis:

Can anyone validate this hypothesis from experience or would this proposal be a test of this hypothesis, and if so, is it a good allocation of capital?

I’m not saying it’s not a good use…I just don’t know. Is there a way to learn or gather evidence to support this hypothesis before we vote on it? BTW, if ppl more connected and experienced in DeFi than I, like vouch for this approach that is good enough for me. I’m just hesitant to move forward without at least a gut check from other DeFi founders. Perhaps this is an idea Tyler can float by the other members of the Ape Tapes to see if it hold water?

While this is a great idea, I feel this is one for the future.

The focus has to be inwards in the beginning.

3 Likes

I agree with some of the replies above. Yes it sounds like a great idea however it may not be the correct way of doing things.
Firstly, the focus of Barnbridge is to bring TradFi into DeFi. Therefore we should address the issues TradFi has and build a great product around it. The team has done some great work with writing articles about stress tests and having advisors from SNX and AAVE.
Secondly, I think we should not be bothered by adoption of DeFi and keep building the product. If the product is great, other protocols looking to integrate. If not, they won’t. By sweetening other project to use Barnbridge you lose valuable feedback about whether the product has marketfit or not.

The team has done great work and there is +400 mil locked into pool 1. If the product can add value after the launch to that pool, liquidity and integrations will come. Build and add value. (Y)

2 Likes

I’m a little late to the discussion but my 2 cents are as follows:

  • I’m all for building that network and if this could be effective, i’d support it. I’m just not sure airdrops will give you the stickiness we’re looking for. Open source code is already a great way to reach the wider community though I’d of course be careful to maintain our moats.

  • We should certainly continue to look for ways to collaborate with different players in the ecosystem and I think the team has been doing a great job so far given there isn’t an actual product yet.

  • Incentivizing people or teams who bring in significant TVL is great and I would support a referral bonus that is demonstrably effective in this regard.

2 Likes

I see this as a potential share steal opportunity several months down the road. I’m in agreement with a lot of the replies above around making sure you’re getting a measurable outcome from any $BOND that is provided outside of the DAO and Bounty programs.

As someone from a Commercial organization, I’m philosophically aggressive with owning market share. If we see that Saffron is capturing significant market share in the fixed-income/non-bank market, and we know we have an advantage, it may be worthwhile dropping them an airdrop to get them to “switch”. “Switching” is a measurable outcome and is actually incredibly valuable to achieve. We’re not there yet and we don’t have the product running, or the data dashboards, to track that.

Just a thought.

Merging this with the “we need to get more people talking about BarnBridge”:

One thing that we could do that would potentially at least foster cohesion between our communities is to create a bounty for $BOND to other communities to join our community and we do a snapshot with protocols we want to work with (similar to what Illuvium did with their NFT) and we basically say we’ll give “X” amount of $BOND to the people who join our community from their community. Many people will leave but many will also stay.

This sort of merges with the “airdrop tokens to other protocols” but we’d be airdropping them to their communities. It doesn’t have to be a ton to be effective.

I think this is quite interesting idea.

Things I personally love to see if this is going through:

  1. Vesting period of one year
  2. Staked BOND in the DAO
  3. Distribute rather less tokens with certainty to earn more because of vesting/DAO rewards
  4. Choose max 10 DAOs to airdrop
  5. Imho these DAO should be weight up : Synthetix, Uniswap,/1inch, UMA, Maker, Badger, Compound, Aave, Curve, Yearn…
1 Like