Delegate Mission Request: Optimism Dominance in Yield-Bearing Assets 1C

[opjulian]

Delegate Mission Request: Optimism Dominance in Yield-Bearing Assets 1C

Application Link

Make sure you’re logged in with Farcaster, and make sure you choose the correct S6 Mission field (this will be the same name as the title of this Mission Request).

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Optimism Dominance in Yield-Bearing Assets (3 of 4)

Delegate Mission Request Summary:

This mission is part of a package that is intended to make Optimism the dominant venue for trading and creating yield-bearing assets. The target assets include real-world assets (RWAs), yield-bearing DeFi tokens that are simple in structure, and staked ETH.

This mission is specifically designed to incentivize the importation of $70,000,000 of yield-bearing assets to Optimism. Assets that are bridged into Optimism and then subsequently deposited into DeFi protocols will target a 5% annualized reward incentive (in OP) on top of whatever native yield is produced by the DeFi protocol and underlying asset. This program is intended to only cover assets that are permissionless in their transfers between addresses.

Requirements to be whitelisted should be minimal, and whitelisting is mainly to avoid subsidizing scams and to assist in tracking assets.

Users may not earn rewards simultaneously through this Mission and Superfest, which is funded through the Foundation. If an eligible asset is bridged to Optimism and then deposited into an eligible DeFi protocol, this Mission cannot provide that user with rewards until the Foundation-funded incentives are depleted or ended. For the avoidance of doubt, to the extent that there is overlap between this Mission and a Foundation-funded initiative, Foundation funds should be used to reward users first, and then this Mission can reward users.

S5 Intent

Intent 3: Grow application devs on the Superchain

Proposing Delegate

GFX Labs

Proposal Tier

Scales up to tier of proposer

Baseline Grant Amount

1m OP total. This is to be distributed to users that bridge whitelisted assets and deposit them into whitelisted DeFi protocols. In the event the rewards budget is exhausted before the ended of the period, the rewards will be provided on a first-in-first-out basis. The Grants Council, at its discretion, may choose to limit the amount of OP rewards that can accrue to a single whitelisted asset to avoid crowding out of other assets.

Should this Mission be fulfilled by one or multiple applicants

Multiple

Completion Date

Six months from Mission approval.

Specification

How will this Delegate Mission Request help accomplish the above Intent?
This incentive program is intended to encourage users to migrate yield-bearing capital assets onto Optimism. The presence of such assets organically increases the TVL secured by Optimism over time as yield accrues to those assets, and they tend to be economically productive assets that encourage longtermism. As part of a broader, four-part package to attract RWA, staked ETH, and other yield-bearing assets, we expect this program to

What is required to execute this Delegate Mission Request?

• A whitelist of eligible yield-bearing assets with permissionless token transfers. This includes at inception: wstETH, rETH, cbETH, sfrxETH, USDM, USDY, and bI0B1. wstETH and rETH are already important assets on Optimism, cbETH and sfrxETH are assets closely associated with major Superchain members, and USDM, USDY, and bI0B1 are permissionless tokens that were recently vetted and approved for Arbitrum's treasury diversification.
• A process for asset issuers to apply for whitelisting by the Grants Council or its appointed agents. This process should ensure assets have permissionless token transfers on Optimism and their issuing chain, and are not scams, but should otherwise be fairly permissive.
• A whitelist of eligible protocols for users to deposit bridged assets into to be eligible for rewards (contingent upon teams actively assisting in data collection, to include at inception: Aave, Beefy, Exactly, Interest Protocol, Compound)
• A process for protocols to apply for whitelisting by the Grants Council or its appointed agents. This process should ensure the protocols meet the following criteria:

Support at least one whitelisted asset as collateral or for lending by users,

Provide data collection support to the Grants Council and its agents,

Are present and fully operational on Optimism no later than May 1, 2024.

How should the Token House measure progress towards this Mission?

• Number of yield-bearing assets whitelisted for this program.
• Amount of yield-bearing assets bridged onto Optimism from Ethereum and other chains.
• Duration of stay by those bridged assets.

Milestones

• Optimism users have bridged in and deposited $70,000,000 of reward-eligible, yield-bearing assets in DeFi protocols.

How should badgeholders measure impact upon completion of this Mission?

• Aggregate capital inflows from the real-world economy, Ethereum, and other chains for yield-bearing tokens on Optimism.
• Number of RWAs and yield-bearing projects deployed on Optimism that also have permissionless token transfers.
• Trading activity of permissionless yield-bearing project tokens on Optimism DEXs like Velodrome, Uniswap, and Curve.
• Amount of yield-bearing assets held in Optimism DAO treasuries, to help foster economic resiliency of those organizations.

Have you engaged a Grant-as-a-service provider for this Mission Request?

No.

Has anyone other than the Proposing Delegate contributed to this Mission Request?

No.

This Mission Request is considered failed or withdrawn if the other three missions labeled “Optimism Dominance in Yield-Bearing Assets” do not pass.

Which metric will the success of this Mission Request be evaluated against?

The North star metric against which this Mission Request should be evaluated is TVL, because the initiatives outlined above aim to attract an influx of additional assets. This metric was suggested by the foundation and approved by the Grants Council.