[ARFC] May 2025 - Funding update

Governance
1

title: [ARFC] May 2025 - Funding update
author: @TokenLogic
created: 2025-04-28

Summary

This publication presents the May Funding Update, consisting of the following key activities:

  • Bridge funds to Ethereum;
  • Create 6M USD Allowance for AAVE buybacks; and,
  • Acquire 4M GHO for Operations.

Motivation

This publication combines near term operational needs and migrating assets held on L2s and side chains in preparation for funding future incentive campaigns.

The below outlines the objectives of this publication:

  • Consolidating funds to Ethereum; and,
  • Support near term operational requirements;

Bridge Funds to Ethereum

Each month, the DAO will bridge its funds held on other networks back to Ethereum, where they will be allocated to support ongoing incentive and buyback programs. With the Umbrella upgrade pending, Horizon and AAVE buybacks already underway, consolidating assets on Ethereum ensures that sufficient capital is available and accessible when needed.

Acquire GHO

In the short term, we anticipate multiple initiatives will seek funding from the DAO. This proposal, once enacted, will secure a sufficient amount of GHO to support the DAO’s operations. This ensures the DAO remains consistently well-capitalized.

Upcoming anticipated expenses include:

  • Renewal of Service Provider agreements;
  • Merit and ALC distributions; and,
  • Incentive campaign(s).

Acquire ETH

The Aave DAO continues its treasury rebalancing by converting a portion of its MATIC holdings into ETH. This action builds upon the funding update initiated in April, during which the first batch of Polygon-based assets was bridged back to Ethereum.

The ETH acquired through this reallocation will be directed toward the Frontier program, where it will support Ethereum decentralization efforts while simultaneously generating yield for the DAO.

Fund Merit + Ahab Programs

Merit is $12M per year at 3M per quarter or 1M per month.

Ahab is $8M per year with the amount of ETH being distributed subject to ETH price fluctuations. The previous 3 month period’s budget was 800 ETH and of this 800 ETH, not all has been consumed. As a result, the next budget period will receive only 800 ETH.

Specification

This proposal shall be submitted as several AIPs that align with operational readiness timelines and ease of review given the volume of funds being moved.

Bridge Assets to Ethereum

Bridge the following assets to Ethereum.

Polygon Arbitrum Optimism
DAI DAI DAI
USDT USDC.e USDT
USDC.e USDC.e
WPOL
WBTC
MATICX
ETH

Transfer Assets

Transfer all AAVE to the Ecosystem Reserve.

Deposit Assets

Deposit 115 ETH held on the Treasury into the Core instance of Aave.

Ethereum - Swaps

Withdraw the following from Aave and swap them as outlined in the table below:

Ethereum Amount Swap
USDT 2.00M GHO
USDC 2.00M GHO
DAI All USDS
LUSD All ETH
CVX All ETH
FRAX All ETH

Create Allowances

Acquire ETH

Create a MATIC and stMATIC allowance for the Aave Finance Committee to then swap each asset to ETH and transfer to the Treasury.

  • Asset: MATIC0x7D1AfA7B718fb893dB30A3aBc0Cfc608AaCfeBB0
  • Amount: 580,156.21
  • Asset: stMATIC 0x464C71f6c2F760DdA6093dCB91C24c39e5d6e18c
  • Amount: 24,796.49
  • Spender: AFC 0x22740deBa78d5a0c24C58C740e3715ec29de1bFa
  • Method: approve() MATIC and stMATIC on the Aave Collector contract to the AFC address

AAVE Buybacks

Create a 3M aEthUSDT and 3M aEthUSDC allowance for the Aave Finance Committee to perform 6 weeks of AAVE buybacks.

  • Asset: aEthUSDT 0x23878914EFE38d27C4D67Ab83ed1b93A74D4086a
  • Amount: 3M
  • Asset: aEthUSDC 0x98C23E9d8f34FEFb1B7BD6a91B7FF122F4e16F5c
  • Amount: 3M
  • Spender: AFC 0x22740deBa78d5a0c24C58C740e3715ec29de1bFa
  • Method: approve() aEthUSDT and aEthUSDC on the Aave Collector contract to the AFC address

Merit + Ahab Programs

Create allowances to the Merit and Ahab, 3M aEthLidoGHO and 800 aEthWETH from Aave v3 Prime and Core respectively on Ethereum:

  • Asset: aEthLidoGHO: 0x18eFE565A5373f430e2F809b97De30335B3ad96A
  • Amount: 3M
  • Asset: aEthWETH: 0x4d5F47FA6A74757f35C14fD3a6Ef8E3C9BC514E8
  • Amount: 800
  • Spender: Merit0xdeadD8aB03075b7FBA81864202a2f59EE25B312b
  • Method: approve() aEthUSDT and aEthUSDC on the Aave Collector contract to the AFC address

Gnosis Liquidity Mining Rewards

  • Asset: aGnoEURe: 0x3e652E97ff339B73421f824F5b03d75b62F1Fb51
  • Amount: 25,000
  • Spender: ACI0xdef1FA4CEfe67365ba046a7C630D6B885298E210
  • Method: approve() aGnoEURe on the Aave Collector contract to the ACI address

Reference: [ARFC] Set ACI as Emission Manager for Liquidity Mining Programs - #83 by ACI

Gas Reimbursement

Transfer 0.5847 ETH to ACI to reimburse expenses incurred.

This reimburses associated gas costs linked to AIP submissions and administering various incentive reward programs.

ACI Receiving Address: 0xdef1FA4CEfe67365ba046a7C630D6B885298E210

Disclosure

TokenLogic does not receive any payment for this proposal.

Next Steps

  1. Using the Direct-to-AIP process, submit AIP(s) for vote.

Copyright

Copyright and related rights waived via CC0.

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2

Hi @TokenLogic
Please tell me the reasons for not converting DAI and LUSD, FRAX, RAI to GHO.

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