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Expanded Strategies and Liquidity Programs
Recorded: Nov. 28, 2023 Duration: 1:04:40Space Recording
Full Transcription
Hey, everybody.
We are just waiting for the other speakers to join.
We'll get started here in just a few moments.
We'll get started here in just a few moments.
We'll get started here in just a few moments.
Hey, Jordy.
Welcome, welcome.
GM, GM.
Or GN, in our case, in Asia.
It looks like we're just waiting for Gabe.
We'll just give him a couple more minutes to join here.
We'll send out a few more announcements, get a few more folks in here.
Absolutely.
Yeah.
All right, it looks like we've got Gabe here.
Do you want to just do a quick mic check, Gabe?
Hey, guys.
How's it going?
Can you hear me?
Yep, we can hear you loud and clear.
Awesome.
All right, let's just give it one more minute.
Let a couple more people roll in, and then we'll get started.
Okay.
All right.
Let's just jump right in.
Welcome, everybody, to this AMA about MIP28.
We're going to dive into all the details so that you're well-informed if you're going to go ahead and vote, if you're already a delegate.
If you're not a delegate, I hope this will convince you to, you know, maybe delegate some of your MNT or BIT and get involved in Mantle governance.
So for anybody who's not familiar, I'm Elbryan.
I'm one of our community leads here at Mantle, and I'll be helping to steer this conversation in the right direction.
And thank you for everybody who submitted questions for this AMA.
We will be answering some of those questions throughout, and we'll be awarding five winners, a share of 100 MNT for those questions.
How about we just do some quick intros as well?
Jordi, why don't you go ahead and introduce yourself?
Sure, thanks, Brian.
I'm Jordi.
I'm the chief alchemist at Mantle.
I'm also part of the economics committee, so very relevant for what we're discussing today.
Yeah, I've recently voted today.
I voted in favor, and yeah, I'm looking forward to discussing with Gabe and you and explaining kind of all the pieces of this really exciting proposal.
Awesome.
And Gabe, do you want to go ahead and give yourself an intro for the community?
Yeah, sure.
Hey, guys.
Gabe here.
I'm on the DeFi team at Mantle, currently leading DeFi growth within the ecosystem.
So, day-to-day conversations with projects, building on Mantle, just guiding people through the ecosystem.
And yeah, thanks for having me.
Absolutely.
All right.
So, let's just jump right in.
So, the title of this proposal is MIP28.
It's an economics committee proposal.
We'll start there, actually.
And the full title is Expanded Strategies in Liquidity Programs.
So, just for some background, Jordi, can you let us know what the economics committee is and why it was originally proposed?
Yeah, I think it's related to what we've seen with all DAOs in general, where you can have the community, you know, forward on certain important matters and vote on a committee and, you know, selecting a council.
So, but ultimately, you know, for day-to-day administration operations and, you know, managing treasury funds, it's not really feasible or even a good idea to just sort of, you know, rely on people to, it would be asking, you know, token holders to have a full-time job of assessing these things.
So, the Mantle Economics Committee was formed to, you know, really be in charge of doing this due diligence and managing the treasury in a way that's beneficial for the entire community and the entire mantle universe.
So, that's why it was formed.
Right on.
And how do you guys sort of make decisions?
How does the Economics Committee sort of make decisions about how they allocate the treasury?
And maybe you can talk a little bit, too, about who's involved in the Economics Committee and how that committee gets sort of built, how people are added to it or removed, those sorts of things.
Yeah, so there's, you know, a few different stakeholders, I would say.
One of them, you know, probably the only doxxed one, so I can't comment on, you know, the names of other people on it.
But, you know, there's a few people and they represent different factions and different types of stakeholders.
So, we have a balance and everybody has a lot of experience with, you know, managing assets.
So, that's the key parameter.
You know, we really have a huge treasury, even without the M&T.
There's a nice dashboard now that I encourage people to find on DeFi Llama that's just being put up a couple days ago.
It's pretty cool.
You can see a full breakdown of all the DAOs in crypto and the breakdown of Stablecoin's own asset and other liquid assets as three different columns.
And so, by far, the mantle treasury is the largest in Web3, especially when taking out, you know, native assets.
So, we really have that experience and it's very key to have that experience to make decisions, you know, with 10 figures worth of community assets.
This is what all the mantle token holders are, you know, a part of, really.
And I would say, you know, initially in MIP25 and the creation of the committee, it was like a don't lose money, don't lose, don't lose, don't lose.
That was the mantra.
Just be very careful, very conservative.
So, I think we did that for some time and we've established some processes.
And now, with this new proposal, it goes from just don't lose the money, which, of course, is always going to be important.
You know, don't do anything stupid.
But now, it is, you know, let's use this weapon.
Like, this is a weapon for our community, for mantle.
And let's be more proactive and be smart around, you know, how we deploy it.
So, that's where we are and I'm pretty excited.
Yeah, I think for anybody who's been here since the BitDAO days, we've seen an evolution in the way that the treasury assets are used.
In particular, with these recent proposals.
So, this one is certainly a step in the direction of utilizing these assets within the ecosystem to help grow the ecosystem.
But also, as an opportunity to help grow the treasury.
So, when it comes to evaluating risk and yield opportunities, I mean, maybe just broadly, you know, what does that conversation look like today for the mantle treasury?
Which direction are we leaning in?
It sounds like we're kind of tipping more into the direction of finding new opportunities in terms of how the economics committee evaluates risk and reward.
Yeah, that's correct.
So, I would say that, as mentioned, we started very conservatively.
And not even just conservatively.
I would say that the main objective initially was to sort of support the ecosystem projects.
And that is still a very important part of what's going on.
But as a secondary goal, we have started adding this goal now of generating income from, you know, this treasury at a very base minimum, you know, getting a safe yield.
And this will ultimately end up, you know, benefiting MNT, benefiting mantle.
So, you know, we will have more proposals in the future for the community to vote, whether it's buybacks, whether it's enhancing yields, whether it's staking MNT.
You know, these things have all been done in crypto.
We've all seen them.
Some of them have been quite successful.
And, you know, those proposals will come later and let the community decide.
But I would say that, as a mandate, you know, for the committee, the reason we're doing these MIP proposals is we are actually getting the pulse of the responses and the community.
And, you know, we thought that there was some ambition in our initial proposals.
You know, we put $150 million set aside to put into TVL, into EcoFund apps.
And now this new proposal, the feedback that we got was that, you know, we weren't going far enough.
We should go further and really use this weapon and make a difference and, you know, get the attention of the space and the good builders and, you know, make an impact in the amount of money we can generate as well.
So the new proposal is for, you know, allocating a billion dollars into a wider variety of strategies and a wider variety of both support but also yield.
So now there's two separate goals, I would say.
Yeah, and with that, maybe we can just dive into some of the details of the proposal.
Do you want to just give us a high-level overview about what's covered, what the different components of it are, the different strategies involved in MIP 28?
Yeah, I think let's start with the lucruity support.
Okay, yeah, so this proposal is basically adds an update to the previous MIP 26.
So there's an additional $240 million in what we're calling yield-bearing assets, additional $220,000 ETH, 2K BTC, and $280 million MNT.
So substantial amounts of funds for liquidity support.
So we had a question from Uwoza J, and their question was, how does this proposal bring growth to the mantle ecosystem, and what does the community benefit from this in the long term?
Yeah, it looks like we lost, Jordy.
Yeah, I think just to jump in here with regards to that question, right?
I think with every new project within the ecosystem, every new project that's coming up for the first time, it's pretty difficult for them to get that initial traction.
So I think how this liquidity support sort of helps grow the ecosystem is that it solves the cold start problem that a lot of the projects face.
So just being able to bring projects from 0 to 1, 1 to 10, and 10 to 100, I think that is a very powerful tool to have.
So you don't have to spend so much money on emissions, giving out more tokens, and then your token starts to dump to infinity, right?
So it's more of building that initial liquidity, allow users to use that initial liquidity, without overly incentivizing liquidity.
Like for the longest time, DeFi protocols have been giving out token incentives just so they can attract liquidity, right?
And I think this proposal sort of solves that issue, being able to bootstrap that initial liquidity and adoption for a lot of the newer protocols coming up in the space.
Yeah, absolutely. I would echo what Gabe said.
So when we are talking to builders and to very strong projects, one of the things that we can differentiate ourselves compared to the 100 other L2s and make a huge difference is that we can say,
hey, like if you are an EcoCon project, we can certainly, you know, supply, you know, 10 million of TVL, get you started, so that when users come, they can actually use the product, how it was meant to be, without crazy slippage.
So this is something that, as far as I know, you know, no other ecosystem has this type of firepower to do this.
So it makes a huge difference.
Yeah, I think just adding on to that, it's also like when projects launch their token for like the very first time, that there's like no going back, right?
And when you give like absurd amounts of incentives and your token holders, your community starts to essentially get dumped on by people who are just farming the incentives and then just leaving after a while, right?
Which are very mercenary in nature.
So I think just having that liquidity there, which is essentially owned by the ecosystem is very, it's a huge, massive selling point, right?
So you know, you know, you know, this liquidity won't go away and you know that you don't have to spend so much of your own token, which you may not be able to like recover back in the future, based on like how your protocol performs and like through buybacks or anything like that.
So yeah, I think that's one of the huge benefits as well.
So for both, I mean, for both users and builders, this is an obvious benefit for one, to help users have a more seamless experience within the mantle ecosystem, interacting with mantle application and for builders to sort of have some surety that they'll have liquidity support within for their applications, for their tokens.
And with that, by the way, if throughout this conversation, if you guys have any other topics that you want to dive into, feel free to spark side discussions as we go, as we move through.
But I'm going to just move on to another question here from D travel from the forum, actually.
So his perspective, actually, he says, I thought the values were too high.
And what is your guys's perspective?
And how are these values determined?
He's also looking for sort of a benchmark reference point for how to think about how much liquidity support is necessary for a healthy ecosystem.
So the values are not just for the liquidity support, it's for the dual mandate.
So as I said, there's a dual mandate now is also, you know, getting yield and using that yield for, you know, either buybacks or staking, you know, the community will decide later on exactly how this income will be used.
But, you know, as crypto has evolved, there is more and more focus on income and returns.
And I think, you know, we will be looking at, you know, for example, we'll talk about Ondo and how USDY and USD comes to the picture and how that's different than, you know, USDC and USDT.
But I would say that there's definitely not, you know, a need to deploy 100% into projects right away.
There is no real benchmark or reference point, because like I said, this is a unique thing that mental ecosystem has.
We talk to, you know, people from other L2s and express like how they would love to be able to offer projects something like this, and they can't.
I think the values that we've mentioned in the last MIP around, you know, $10 million to $30 million per EcoFund app, and quite a bit lower for like the non-EcoFund apps, that's probably where we'll sort of get going.
And I think those are reasonable numbers.
Can you just give us a little background for anybody who's not familiar on the distinction there for EcoFund applications?
Yeah, so, you know, another unique thing that we've taken the approach with Mantle is when we're really excited about an app, about the team, the team is docs.
We've met them, they have a background, they're, you know, they take security, very important, both of the code and also of the team and of any issues to have.
If you like what they're doing, then they can participate in the EcoFund, which is sort of, you know, basically like a VC fund that is owned by the mantle DAO, right?
So there was $100 million put aside to invest in these projects, and we call them the showcase apps.
These showcase apps are basically telling our community that, you know, we have vetted who is behind this, we have talked to them extensively, and this is a full kind of VC-backed round.
There's always other, you know, kind of large VCs that participate in these rounds with the EcoFund.
So there is that credibility, and that also means that as a treasury and as stewards of the treasury, we are more comfortable deploying, you know, eight figures into these apps instead of, you know, let's say six or seven figures.
Right on, and so for anybody who's building for teams that are interested in deploying on mantle or who have already deployed on mantle, how are they going to be able to tap into this liquidity support?
And maybe we can even talk about EcoFund. I don't know if we want to dive in too deep about how they tap in there.
But what sort of factors ultimately influenced the decision to add or remove liquidity support for any application?
I think we touched on this a moment ago, but yeah, what are the sort of factors there?
I mean, as mentioned, like security is key.
You know, we're not going to be deploying into anonymous rug pulls very far from that.
So for, you know, existing projects, you know, generally if they get traction and they're large projects, then there will be some contact.
We will have conversations with them and evaluate.
And, you know, if the security concerns are allayed and the project makes sense, I think, you know, there is definitely capacity even for non-EcoFund projects.
We've already deployed into some of these.
So I would say that there is no hard rules apart from, you know, security is better, audits.
We look at audits, we look at traction, look at the idea and, you know, certainly look at the background of the team before getting into like very serious numbers because we have to be cognizant of, you know, what we've seen in other ecosystems with, you know, kind of honeypots and all kinds of things.
Yeah, I think just adding on to that, like capital security is definitely like number one, right?
So we can't be risking the DAO's money on such like risky plays or like vaults or strategies that are not audited.
So I think definitely as Geordi said, there's no hard and fast rule, but number one key should be security.
In terms of the sort of the way it's allocated, is it allocated on an average sort of basis, meaning throughout the calendar year, are there set times when liquidity will be provided or is this just on a case-by-case basis?
This is sort of branching from a question by Joran Tan.
Yeah, so are you guys just evaluating projects on an ongoing basis or are there like sort of cohorts and, you know, regular calendar periods where this is allocated?
Yeah, that's a good question.
It's definitely not on a cohort sort of average basis.
There's nothing average about it.
I would say it's a case-by-case.
There is no fixed amount that we have to deploy.
You know, like we'll talk about, like these assets can just generate yield and sort of yield-building stables or something else.
We're not having to, you know, go on a fixed schedule.
So, I would say that what we're really looking at is like major app launches.
So, there's a lot of eco-fund launches that are coming in the next two months.
And, you know, as part of those investments that we've made in attracting those kind of superstar builders, there was, as part of that, you know, indication that we would be supporting liquidity for those projects.
So, it's done as those key projects come online and the more traction they get, the more they'll be supported.
And I think we've seen in other ecosystems that, you know, you don't have a hundred apps that all do the same.
You have some blockbuster apps and we'll just be following the community to see which ones are getting a lot of traction and making sure that they're well supported on liquidity.
Right on.
Yeah, I think that's, I think that approach overall is, like you said, it's support.
So, basically, again, this fund appears to me sort of as a infrastructure in a way.
It's a way for the ecosystem to reliably continue to operate as it scales.
Let's move on to another question here from Siberian Vicky.
So, will the names of the projects and the dollar amounts provided be published before or after the distribution starts?
They mentioned that maybe there's something like a short list of projects similar to what Arbitrum has done.
So, in terms of transparency, how can users learn about the dollar amounts and which projects receive liquidity?
Yeah, just jumping in here, I think this is because most of the liquidity is being deployed by a couple of service providers that are engaged by the DAO, right?
So, all the assets are deployed on chain and while right now it's a little bit difficult for the public to ascertain where the assets are going, we are working with a couple of data analytics providers to sort of come up with like a public dashboard where anyone from the public can just come to this dashboard to see where the treasury funds are being allocated, how much they're being allocated in.
And, yeah, it'll be all verifiable on chain and fully transparent for everyone to see.
And this will likely be deployed in the next couple of weeks.
But, yeah, as of right now, it's all being held in a couple of the treasury wallets.
Yeah, to Gabe's point, I mean, there is an incredible amount of transparency focus with Mantle and Mantle DAO and the Mantle treasury.
Any user can, at any point, see in real time if they go check the website, not only where the assets are, but even things like month-to-month expenses, like the full financials of every line item of expense, you know, whether it's salaries of employees or what's going on, they can fully track everything.
So, you know, that ethos will certainly carry over to these types of deployments.
I will say that, you know, the Arbitrum thing is very different because that was a one-off sort of, you know, the steps and those things are not ongoing, you know, liquid deployments.
Those are one-off, you know, token grants.
And it's easier to create snapshots and show kind of, you know, who's going to get the grant versus, you know, it's a very dynamic environment where you just have to check in life in real time and check the dashboards that are getting created.
Yeah, and with that, if anybody hasn't had a look at the treasury monitor on the website, you can find that by just searching treasurymonitor.mantle.xyz.
There's a handful of tools there for you to view transparently how funds from Mantle treasury, Mantle core budget, Mantle eco fund, and a handful of others, how those have been utilized.
And also the wallet sets for, Jordi, maybe you can comment on this.
There's a handful of wallet sets which are already published in the documentation.
Do you know which ones those are?
I was looking at them today, but I don't know the full details.
So, better that I don't say something that might be slightly wrong.
Better that's not to not comment on that before getting the full information.
Yeah, so just, I mean, for anybody who's interested, basically that information is published there in the documentation.
So, ultimately, the goal is transparency for the DAO and for everybody who's involved, delegates, holders, anybody who's involved in the Mantle ecosystem.
Did you guys have anything else you wanted to mention in terms of this first strategy of liquidity support for applications?
Anything you're particularly excited about or think the community should know?
I mean, the thing I'm excited about, like I said, there's some really kind of key apps that we've been waiting for.
They've been getting built that are about to deploy.
So, those will get supported with liquidity support.
I think the community will join in once they are able to experience.
I think the yields are going to be good.
If people like yield farming, if people like borrowing, different experiences that are being kind of created.
So, I don't want to get into the details of that because I'm going to steal the thunder from those launches.
But, yeah, I think that part is clear and it's just an expansion of the previous MIP and it's just an escalation of the sizes.
So, maybe we can kind of go to the second strategy that's part of it, which is the seed liquidity for like RWA kind of yield-backed tokens.
I think, you know, one of the large announcements we've had this quarter has been the Ondo announcement related to USDY.
We've had a separate spaces or maybe a few spaces now.
Gabe can maybe tell me how many we've had.
But we have talked about this, so we don't need to get into too much detail.
But, you know, the previous amounts that we had allocated, so we started with $30 million into USDY, which is a freely transferable, freely used in DeFi native yield.
It's around 5.2%.
Everything's transparent, on-chain.
You can check, you know, all the components and Ondo is very regulated and transparent entity as to, you know, exactly which U.S. treasuries are holding, et cetera.
So, I would say that we are expanding the amounts that will go into these.
We don't want to hold so much USDC, USDT for the community that's earning 0%, sitting in treasury, doing nothing.
This is where the future is going.
This is the future of DeFi, is, you know, stacking yields, native yields.
And we will be deploying more than the $30 million.
And, again, I think this gives us the ability to do that.
And we feel quite safe with the chosen RWA so far.
We will diversify into some other stablecoins as well for extra yields, for extra diversification.
But that is the expansion of MIP28 on this topic.
Yeah, I think just to add to that, I think one of the key benefits here of bringing and onboarding a bunch of these RWA-backed stablecoins is that
not only we are able to give users an opportunity to de-risk from the volatility of crypto through, like, stablecoins,
but that they'll also be able to draw from yields coming from, like, U.S. treasury bills and sources that are non-volatile sources of yield that are outside of crypto.
Because I think, while we have a lot of stablecoin yields that are generated based from, like, AMM volumes that can be, like, maybe 10%, 10%.
But the problem is that they oftentimes fluctuate pretty significantly.
And I think being able to diversify into, like, MUSD or USDY is a pretty big game-changer.
Being able to access really stable yields in a very cohesive manner that's very composable in DeFi as well.
And Gabe, maybe this is one for you, since you're the, as Jordy said, you've already done a lot of AMAs and such about MUSD and USDY.
Maybe you could just give us a brief overview about what these assets are and what the distinction is between MUSD and USDY for anybody who's not familiar just yet.
Yeah, sure.
So typically, a centralized stablecoin like USDT or USDC is typically backed by either cash in the bank or short-term T-bills that the custodian or the company holds, right?
Like Tether or Circle.
And the difference between this and USDY, USDY is a yield-backed stablecoin where the stablecoin is backed by short-term Treasury bills that is then redistributed to the holders of USDY.
So USDY holders have a claim to that yield that is generated, whereas for like a typical stablecoin minting company, this yield goes back to the company, right?
So the users, the end users of these stablecoins do not receive a share of that yield and they benefit, they just benefit from like the token being stable, right?
So USDY enables holders to receive a portion of that yield at a 5.2%, as Jordi says.
And what we're doing with MUSD is that we are issuing a wrapped rebasing version of that USDY, where instead of being a user where you have to claim the yield, the yield automatically increases in your wallet.
So what this means is that just by holding MUSD, users will be able to benefit from the 5% deals that are generated from the Treasury bills.
So I think that's pretty powerful as not only you natively have a yield-bearing token, but you can also use this token in various DeFi strategies, being able to create yield on top of yield, being able to deposit this and borrow on top of that.
Then essentially have like a loan that is repaying itself, right?
So I think that is one of the key differences between regular stablecoins.
And yeah, I think being able to have a very sustainable and composable asset in the ecosystem is a very powerful thing to have.
Yeah, you mentioned utilizing these assets in DeFi.
Where are USDY and where are these assets sort of integrated into Mantle DeFi and what sort of opportunities already exist out there to sort of stack yield within the Mantle ecosystem?
And then maybe we can move on to what opportunities we see coming in the future, what sort of strategies might develop as the ecosystem continues to expand.
Yeah, sure.
I think the most obvious ones would be to get USDY and MUSD integrated into like DeFi lending protocols where users can borrow on top of those stable assets.
We are still waiting for a couple of protocols to deploy these functionalities.
But the current use case is that users can swap in and out of regular stablecoins for MUSD and USDY that is yield bearing in nature.
So in the future, the ideal scenario is being able to plug these assets everywhere we can into more complex strategies where we create like vaults that are auto compounding, creating yield out of yield, and being able to really harness the whole, essentially the risk-free rate in the ecosystem.
So right now, I think it's still pretty early days for MUSD and essentially set like a higher baseline of yield in the ecosystem.
So right now, I think it's still pretty early days for MUSD, USDY, and also the incoming MEF, right?
So I think in the next couple of months, this will get a lot more interesting.
We'll have more complex strategies for users to play with, more complex strategies for investors to get a higher return just by deploying assets into pretty complex strategies.
I mean, exactly what Gabe said.
There's no reason why everything that's been done in DeFi on any other app, any other chain, shouldn't have the extra boost for the users.
I think, you know, Blast kind of popularized this concept.
But actually, we've been working on this for many, many months, and we actually have it live as opposed to a, you know, contract to a multi-sig that's sort of sitting there doing nothing.
On our side, we've already, you know, done the legwork, built the native yield into the assets, and we've also built our own.
We're not just sort of piggybacking on DAI.
So MUSD is a new novel product, and the apps in the ecosystem will certainly be integrating it now as it comes online, for sure.
Yeah, so again, I mean, I think the core benefit here, as we've heard time and time again, is just yield on yield on yield.
And yield is a sort of base step for anybody who's involved in the Mantle ecosystem.
You can hold these assets and just immediately start earning yield on them and then stacking there on once they're integrated further into Mantle DeFi.
I think you touched on this briefly at the beginning, Jordy, but I had a question here from the community.
0x2Btochi, we'll just call him, from Discord.
And the question is, are the reserves by the real-world assets backed stablecoins, audited, and team KYC'd in public to the Mantle community?
Basically a question of trust here.
So, you know, this whole idea of if you don't know where the yield comes from, you're the yield.
How can we sort of, you know, make it more clear exactly where this comes from, who this team is, and yeah, minimize that risk factor?
Yeah, I mean, I can see some PTSD from, you know, things like Luna and all this stuff.
But, you know, this is nothing related to that.
It's not even about docs to us or whatever.
I mean, we're talking about regulated U.S. treasuries.
This is, they're docs not to us.
They're docs to, like, the U.S. government.
This is as regulated as you can get.
So, anybody can go to the Ondo website and check, you know, what is backing USDY.
They have a full breakdown of exactly how many dollars are in which, you know, expiry of treasury.
So, you can see exactly how many days for, they're all short-term treasuries.
So, you know, a few days to a few months.
So, absolutely, there is no anonymous or, you know, unknowns here.
This is as clear as it gets.
And so, there's another asset, another sort of USD coin within the ecosystem from Athena, EUSD.
Can you guys just talk a little bit about that?
What Athena is?
What EUSD is?
And maybe how it differs from these other assets like USDY and MUSD?
Yeah, it's a very different asset.
It's not a treasury asset.
So, this is a crypto native asset.
It is a sort of novel type of asset.
You know, it has a component of Ethereum staking and then shorting ETH in order to create a sort of market-neutral position.
Now, we've seen some attempts to do this before.
There was, you know, one on Solana that was doing quite something similar.
I would say Athena is taking it further, you know, trying to tap into the amount of perpetuals that there are.
So, if you can imagine, you take some staked Ethereum.
So, you're generating some yield there.
And you use it as collateral to short perpetuals.
And those perpetuals are on DEXs or on SEXs.
So, it's both on, let's say, Binance, Bybit, as well as, you know, things like Synthetix and, you know, potentially DYDX, these types of, like, large DEXs as well.
So, I think the team there is kind of choosing, you know, deciding which DEXs and which centralized perps to deploy on.
I think the current open interest on Ethereum perps is somewhere around $6 billion, if I'm not mistaken.
So, the idea is to tap into that and generate yield through, you know, holding stake thief and adding the funding rate.
So, there is a Genesis program for, you know, the initial participants and the EcoFund being also like an investor in Akina.
Actually, I don't think it's the EcoFund.
I think it's one of the partners of the EcoFund, if I'm not mistaken.
But we will be deploying, I think, $10 million into this stablecoin.
It should be providing, you know, yield for the community, both through the native yield and also through the mining program, I guess.
You know, a bit of a early token mining as well.
Yeah, it's actually funny you ask because the founder of Aetina is actually listening to this AMA right now.
So, maybe if you want to, can we bring him on?
Yeah, if you want to request to speak, I can approve that request for you.
No pressure.
Yeah, no pressure at all.
In the meantime, I mean, I'll just explain that, you know, Mantle Treasury is open for business.
Like, MUSD is the native yield.
It is the native asset.
It is Mantle USD.
So, this is kind of like, you know, the key core component of the ecosystem.
But the Treasury, you know, can't just be in one asset.
It will be diversified.
We are looking for high quality projects like Aetina to put more of these stable coins, you know, just get into yield, yielding stable coins that are high quality like this.
So, we are open for business where we've been taking a lot of calls.
We've talked to more than I can count.
We assess them both for like regulatory side, you know, what's the amount of the yield, security, all these things.
So, thankfully, we have a very experienced team that can analyze these and we will be, I imagine, probably choosing more and expanding deployments in these assets.
Yeah, I think the founder of Aetina just requested to speak.
Uh, is it?
Is it?
I don't know.
I'm not a host, so I can't.
Should be coming on stage now.
Hey guys, can you hear me?
Hey.
How's it going?
Hey, man.
Good, thanks.
Uh, yeah, didn't mean to hijack your spaces was just listing in, uh, in the background.
So, happy to answer any questions, but I think, uh, Jordy covered it pretty well.
So, um, yeah, here if you need me, but don't want to sort of hijack your space.
It'd be great, uh, maybe you can just give, give like, um, I mean, a lot of people are looking forward to, um, things launching.
Like, is there a timeline?
Like, what are things looking like on, on the timing?
Yeah, at the moment we were sort of deployed and just doing the final internal tests with, um, prop capital at the moment.
So, uh, things are live, um, at the moment and just seeding some of the liquidity pools on chain at the moment.
And, uh, as you mentioned, Jordy, I think that there's going to be a period where we just onboard some capital, um, in the beginning before it's fully open to the, uh, to the public.
Just to make sure that it says safe and secure and ready for them to come in.
Um, so I think broad timelines kind of spend the next month, um, just onboarding that internal capital, including the amount that, that you described there from Mantle.
Um, and then the ideas will come out, um, with a public campaign in the beginning of January, uh, where everyone can sort of jump in and interact with the protocol.
Awesome. Yeah.
As I said, this is a, uh, a very cool novel approach.
Um, do we, do we know what the yield will look like initially?
I guess like, you know, staked ETH right now is sort of three, three and a half to 4% range.
And then thankfully, because we've started being more in the bull market, the, uh, the funding rates on ETH have frequently been kind of going up at times.
Do we have any sense?
Yeah, it's, it's 20% fixed.
Um, no, uh, just joking.
Uh, just joking.
That gives me, um, flashbacks to another stable coin project.
Um, at the moment, um, yeah, as you pointed out, it's been roughly tracking around 12 and a half percent all in this year.
So funding for ETH contract on an open, uh, open interest weighted basis across the market, uh, has averaged around 8% this year, uh, which is pretty surprising.
I think if you think about a low volatility that you've seen in ETH and then B the fact that ETH hasn't actually moved that much this year.
Um, but as you said, with some of the ETF sort of bullishness that came through the last month, uh, market-wide funding climbed from eight to where it's been averaging closer to 13 to 14% um, within the last month.
Uh, so just looking at the dashboard that we have here now, um, as of the last sort of three weeks, it's been averaging, uh, 15 to 16% um, for, for, uh, the stable.
And that's obviously without doing anything interesting when it comes to adding it to money markets, doing some of the leverage looping, which I know is on the plan with some of the mantle ecosystem projects that are coming out.
I think it will be quite interesting to think about.
Yes, that's an interesting unlevered yield, but your ability to take that asset and then compose it through the rest of the mantle ecosystem and start to loop that yield in interesting ways.
I think it's something that we're super excited about with, with mantle going forward.
Um, I think that's the, uh, that's the cool thing about DeFi.
You kind of, you have these like stacking blocks and, uh, very excited.
Um, I'm happy that the, the bulls are back and the yields are higher, uh, even for, you know, people that want to hold stables.
And, um, yeah, excited for the launch and happy to be participating.
And this is exactly the type of thing that the, you know, MIP 28 is looking to do is, um, you know, expand the size and scope of these type of, uh, programs that we're, we're able to do.
We're able to participate in, uh, on behalf of the entire mantle, uh, community.
Uh, cool.
Well, thanks G for, for coming up.
I think we have a couple more points.
Um, we want to touch upon on the proposal before we, uh, before we finish the spaces.
I think there's two more strategies, but, um, thanks for coming on.
Yeah. Thanks so much.
Um, yeah, we are sort of running into the last 10 minutes of the space here.
So we do have two new strategies that are proposed as part of MIP 28.
We'll just jump straight into the, uh, the first one here, which is asset rebalancing.
Um, so maybe we could just do TLDR on this.
So what is asset rebalancing?
Why is it necessary?
And, um, you know, I guess why introduce it to, to this proposal?
So asset rebalancing, you know, we have, I would say a few categories.
So the proposal shows that we have, you know, certain amount of MNT, certain amount of Bitcoin.
Well, um, potentially, uh, Bitcoin.
I think right now there's, there's very little or no, or no wrap Bitcoin.
Um, there's a very large amount of Ethereum and there's a large amount of stable coins.
So, um, you know, asset rebalancing is, uh, necessary for various reasons.
One can be, you know, we do need to deploy some, you know, wrap BTC into, uh, into certain pool.
For example, so we will need to rebalance, uh, into some Bitcoin.
We, uh, we may be running out of, um, certain type of stable coin.
We have to rebalance into it.
Um, you know, these types of things are sort of operational, I would say, and that's one reason why they would happen.
Um, and then the other reason is, uh, potentially like, you know, yield related or gains related.
So, um, I think a balanced treasury is sort of robust and generating returns in, in all market, um, categories.
So, um, you know, you want to have enough beta, uh, and enough protection on both sides.
I think, uh, you know, for example, if, um, the mantle, uh, token price became very attractive, we could rebalance and increase our holdings there.
Um, you know, if, um, there was a dip in Ethereum that seemed to be temporary, we could increase assets there.
So obviously, um, you know, the, the risks are going too far and being too active.
We're not, we're not, we're not trying to be like, uh, you know, an active, like, uh, liquid fund, but, uh, you know, there are a potential, um, occasional kind of event-based scenarios as well as the operational reasons why we would need to do rebalancing.
So that, that's kind of, um, the two scenarios that, that we can foresee.
Yeah, I think, uh, one thing we noticed in the, the last couple of years with mantle treasury and previously the biddao treasury was that, uh, the diversity really helped, uh, with stability through, um, market movements.
And so the ability here to rebalance to further, um, increase, uh, that sort of, that sort of balance of what we've got available for the mantle community within, uh, the doubt treasury is, um, going to be a boon for, for success here.
Gabe, did you have anything you wanted to mention about this strategy?
Yeah, no, I, I think Jordy pretty much covered it.
Um, I think it just adds a little bit more flexibility in terms of, like, how the, the treasury can manage its assets, uh, well enough, especially in, like, such a volatile and interesting market right now.
So yeah, I think definitely liquidity positions will need to be rebalanced, um, when we are supporting a lot of the dApps in the ecosystem.
Amazing.
So then let's move on to this last strategy here, uh, which is subscriptions to market neutral liquid funds.
There's an additional 100 million MNT allocated to the strategy in this proposal.
Um, so, so what are these market neutral liquid funds for anybody who's not familiar?
Um, uh, yeah, Jordy, maybe you can comment on that first.
Yeah, sure.
And I think it's not supposed to be a hundred million MNT, just a hundred million, uh, dollars, I think in general.
So it's a sort of sub allocation.
I mentioned at the top that we are, you know, both looking to support apps, but also we're looking to generate yield for, uh, for the treasury.
And this is more the second category.
So, uh, what we're saying here is, you know, out of the billion dollars, probably a hundred million is sort of ear pocketed for higher yield approach.
So if you can imagine that the MUSD would be generating 5% and we want a certain amount of that 5%, the, uh, you know, Athena deployment will probably be generating, you know, hopefully 10 plus percent.
Then, uh, you know, subscriptions to liquid market neutral funds, uh, you know, we're not talking about like liquid funds that are going out and, you know, buying, uh, uh, you know, roll bid or stuff like that.
Uh, we're talking about, uh, you know, market neutral strategies, for example, something like a, you know, a GMX vault and then shorting the, uh, the assets in that vault to, to just sort of generate the yield.
Uh, that would be like one type of strategy and one type of example, uh, for, uh, what we're looking at for this bucket, which is the sort of higher yield bucket.
If that makes sense to you, um, happy to dig in a bit more.
Yeah.
I mean, I'm curious if there's a precedent for this, um, in other doubt treasuries, are we seeing, uh, sort of any examples from the past about, uh, these, these sort of, uh, approaches being used within other doubt treasuries?
I mean, other doubt treasuries, you know, you have the two extremes, I would say this is in the middle.
So one extreme is like, they do nothing sits there, literally just, you can watch it on ether scan, just sitting stable coins or whatever, sitting there.
Um, and then you had the other extreme, I think probably the most successful, uh, from what I remember in the last market cycle was, uh, Andre Cronje was, uh, telling us how, you know, he took the phantom treasury and yield farmed with it and, you know, leverage on ether or whatever, whatever else crazy stuff he was doing and generate a lot of, uh, return.
So this is in the middle, you know, we're, we're not letting it sit there, but we're also not taking a lot of risks.
So it's, it's market neutral.
Um, and, you know, we have, we have funds that are experts, experts in, uh, these type of returns.
And, um, you know, we're, we're really looking to, uh, round out the yield by, uh, by going for a little bit of a higher, uh, than the, than the treasury rate.
Amazing. Yeah. So I, I think the trend, um, that everybody should be noticing in this conversation is yield yield is sort of taking a center stage here in terms of, um, new sorts of assets being deployed within the mantle ecosystem, but an active approach to managing the mantle treasury, um, with the support of the mantle economics, uh, committee.
So, uh, anything else we're in the last five minutes here, anything else you guys wanted to mention before we start to close out, um, related to MIP 28, or really just anything else that you're, you're excited about in terms of the mantle ecosystem.
Yeah, I think I'm in general, I think the next couple of, the next two months will be very interesting for the mantle ecosystem as, as we see a bunch of the, uh, eco fund backed dApps come on, uh, as well as a few couple of key strategic partners come online as well.
Um, and once this proposal sort of goes through and the treasury is able to deploy assets throughout the ecosystem, I think that's when we start to see the mantle ecosystem start to heat up and get a lot more interesting for both the protocols and the users, um, navigating the ecosystem.
So yeah, I think fun times ahead.
Yeah, absolutely.
I mean, um, I'm especially excited for, uh, for math.
We have math week coming up next week.
So people will be seeing a lot of, um, announcements related to that, uh, math, math lab, a lot of things coming out next week.
Uh, so math is the, you know, the competitor to, to Lido, which, uh, um, you know, is, is very widely used, but not really in DeFi.
It's a 33% of the liquid staking market or the staking market in general, without, um, you know, having as having had that much traction in, in apps and in the ecosystem.
And what we're going to look to change with math, um, is create a version that is much more usable so that you can, you can do this kind of like yield stacking and do all kinds of like fun stuff.
So, um, excited for next week.
Absolutely.
Yeah.
I think going into the next, uh, to the new year, it's going to be a really exciting space for, uh, the mantle's ecosystem is going to be really exciting space for builders and both users.
Um, especially those, uh, looking to, of course, uh, get yield on assets, um, using the variety of tools that'll be available.
I just had a look at the proposal by the way, and it looks like it's already reached quorum.
So, uh, that's a point for celebration, but, uh, that doesn't mean that you can't vote still.
So you're, you're still, uh, able to go and voice your opinion, uh, on this proposal.
If you're a delegate, if you're not familiar with mantle governance, you do need to delegate before you vote.
Um, if you haven't delegated yet, uh, you do have to delegate before a proposal, uh, goes up.
So, um, if, if you're just delegating now, you'll be able to vote on the following proposals, but for all of our active delegates out there, make sure you do go and vote.
I believe the proposal voting period closes.
Let me see.
Let me make sure I get this right.
Uh, it looks like on December 2nd.
So we've got plenty of time, uh, for anybody who hasn't voted just yet.
Um, yeah.
And the link is pinned here in the chat.
But, uh, if you, if you don't find it before this closes, it is on our Twitter feed and you can always find us on snapshot by searching mantle.
Um, all right, cool.
So thank you so much for everybody who asked questions from the community.
We do have five winners.
I'll just list them out really quickly.
It's 0x2bbtoch, Jorantan, Press, Swagspirit, and, uh, Jorantan, or actually not Jorantan again.
Yeah.
Those are, those are our winners there.
Um, so thank you guys so much.
Each of you will receive 20 MNT and we'll reach out to you on discord.
Awesome.
Thanks everybody.
Looking forward to an exciting end of the year here as we roll into December and then to the new year.
Um, thanks so much.
Go out and vote.
Thanks for hosting.
Yeah.
Thanks for everybody for, uh, for joining as well.
Um, yeah, please, uh, please, please keep close eye on the next few weeks.
It'll be, uh, it'll be quite exciting.
I promise.
Awesome.
Thanks so much, guys.
Absolutely.
Thanks, Jordy.
Thanks, Gabe.
Bye.
Bye.
Bye.
Bye.
Bye.
Bye.
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