Summary

Whitelist C3 gauges as depositable vaults for treasury assets.

Motivation

Currently, the assets in our treasury lay dormant and are used purely for backing KLIMA. C3, a recent addition to the ReFi ecosystem, offers gauges for users to stake assets in return for governance. By depositing assets in C3 staking and liquidity gauges, KlimaDAO:

  • Supports the alliance laid out in KIP-15,
  • Gains yield on treasury carbon assets, and
  • Acquires more C3 governance.

Since deposited assets continue to back tokens and (in the case of LP tokens) earn trading fees, there is negligible risk to the KlimaDAO treasury value and inflows. Note that staking in C3 gauges requires a locking period, with boosted rewards for longer periods. This KIP also delegates the right to choose appropriate locking timelines for each staked asset to the Policy team in accordance with broader policy priorities. For further risk assessment, see the auxiliary document.

Proposal
  • Allow the Policy Team to stake up to 50% of each eligible treasury asset into C3 vaults.
  • Allow the Policy Team to vote for gauge rewards using locked C3 governance tokens.
Polling Period

The forum poll begins now and will end at 18:00 UTC 11/04/2022 . Assuming in favour, this vote will go to Snapshot.

Vote

So we would be dropping some of klima-usdc lp into C3 staking? Are we considering swapping some usdc to frax to pair with our C3 to stake?

    IBuyShitCoins KLIMA/USDC is the only asset we plan to stake at the moment, but this KIP delegates the right to stake treasury assets in any eligible C3 gauge (as long as it doesn't compromise the integrity of the treasury)

    Pairing treasury C3 with FRAX for C3/FRAX LP would likely require a follow-up KIP if that's something the community is interested in pursuing, since we'd be reallocating that C3

    Personally my perspective is that we should hold/lock the treasury's C3 grant for governance rights, rather than staking it as C3/FRAX LP

      MarcusAurelius im guessing we could easily stake naked UBO & NBO as well if KIP 21 passes using the UBO & NBO gained from bonding..... then once we pass a future KIP for UBO/Klima & NBO/Klima bonding we can then stake those LPs as well... gonna have c3 coming out our ears

      Besides negligible added smart contract risk, there may also be opportunity cost.

      Staking up to 50% of each eligible treasury asset seems a bit high to me given that the space is so young. It's fine if the lock period is sufficiently short.
      Opportunity cost may include unknown unknowns - for example, we may want to disband some Klima/USDC for liquidity initiatives, or stake Klima/USDC elsewhere, depending on C3's fate.
      Depending on the lock period, this may be a bigger cost than expected.

      A 60 day lock would have a very different risk analysis than a 1 year lock.

      Given the "up to 50% of each eligible treasury asset" bullet point, I recommend adding Policy's lock period intentions to the KIP to clarify opportunity cost risk.
      I would also prefer the range of "up to 50% of eligible treasury assets" to be narrowed a bit to the intended range.

      I am voting "for" with the hope that my comments are taken into consideration when crafting the KIP.

        Fully in support of this proposal as I believe earning yield on our assets is a key part to Klima's success.

        On the specific topic of staking a portion of the KLIMA/USDC LP I'm on the side of staking the max of 50% and being in favour of something such as the below when it comes to locking durations:

        • 5% locked for 1 month
        • 10% locked for 4 months
        • 15% locked for 8 months
        • 20% locked for 1 year

        Personally in favour of having a heavier distribution towards longer duration locks (i.e. 8 months and 1 year) to maximize yield whilst also having a small proportion at shorter duration locks (i.e. 1 month and 4 months) for in the event other opportunities arise that we want to take advantage of and not miss out on, which may require a redistribution of a portion of the KLIMA/USDC liquidity to another pool.

        However, as I say all of this I'm also in favour of a 50% stake at max lock a.k.a. stake that shit

        ShimonD 'I recommend adding Policy's lock period intentions to the KIP to clarify opportunity cost risk.
        I would also prefer the range of "up to 50% of eligible treasury assets" to be narrowed a bit to the intended range.
        ' <-- I second that. I'm not in favor of staking for long periods of time as well just because they're still a newer and untested protocol. But I'm still fully in favour of this KIP.

        After speaking with policy some more on the matter, I forgot that Klima is already guaranteed 10% market share of C3 tokens and will continue to get vested amount of C3 as emissions continue. In that case it isn't necessary for Klima to participate in staking or ve emissions to protect it's market share of the C3 ecosystem. For now I think we should avoid strong arming influence of this young ecosystem until it is more established. Let's see how the market prices in the C3 ecosystem and watch the dynamics unfold.

        In the mean time I support giving policy team the rights to make moves on our behalf if it suddenly deemed necessary.

        Yes please!

        Formality: An abstain option is always nice.

        I go "for" but reading SimonD viewpoint, I agree with his thoughts and it would be great to include his locking limitations in the final KIP snapshot

        Write a Reply...