[ARFC] Treasury Management - auraBAL

[TokenLogic]

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title: [ARFC] Treasury Management - auraBAL
author: @TokenLogic - @MatthewGraham, @defiJesus & @efecarranza
created: 2023-11-08

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Summary

This publication proposes creating a permissioned and upgradeable contract to manage the auraBAL holding.

Motivation

Currently, the auraBAL resides in the GHO Liquidity Committee (GLC) SAFE. The Aave DAO has placed trust in the signers of this SAFE who have custody of the funds.

This publication proposes that TokenLogic create a permissioned contract, similar to the Strategic Asset Contract (SAM) to manage this position. The shortExecutor will be in absolute control of the funds and can grant/revoke the Guardian role to enable a SAFE to interact with the auraBAL contract.

During the initial deployment of the auraBAL contract, the Guardian role will be assigned to the GLC. The specification section below details the functions to be included on the auraBAL contract.

Specification

The below specification defines at a high level the functionality that the shortExecutor can assign to the Guardian role:

1. Mint auraBAL using B-80BAL-20wETH
2. Stake auraBAL to earn yield;
   2.1) Compounder, or
   2.2) Classic auraBAL
3. Claim rewards
4. Transfer rewards to either Treasury or SAM (vlAURA) or GLC (bribes)
5. (Optionally) Swap BAL rewards for B-80BAL-20wETH to mint for more auraBAL

In addition to the above, the Ethereum Executor can also perform the following functionality:

1. Assign the Guardian role
2. Revoke the Guardian role
3. Transfer auraBAL to Treasury
4. Upgrade the contract

Funding

To facilitate the development, this publication seeks the following funding:

Funding Amount: $14,344 USD, to be paid in GHO.
Delivery Schedule: 5 weeks, which includes the review by @bgdlabs (estimated 2-3 weeks).

In line with our standard operating practice, the auraBAL contract will be shared with @bgdlabs for review to ensure their completeness.

The transfer of funds will occur with an AIP submission upon successfully completing the scope.

The Aave DAO is encouraged to vote on one of the following three options:

1. YAE
2. NAE
3. ABSTAIN

Next Steps

1. If consensus on ARFC stage is reached, escalate to ARFC snapshot stage.
2. If ARFC snapshot stage outcome is YAE, TokenLogic will commence building the contracts.
3. Upon delivering the scope, TokenLogic will submit a AIP to create a GHO allowance for equivalent 14,344 USD.

The DAO is expected to uphold outcome of the Snapshot vote.

Copyright

Copyright and related rights waived via CC0.

[0xkeyrock.eth]

Hi @TokenLogic, thanks for this proposal.

As this auraBAL holding is already managed by the GLC and the actions outlined here are doable with a few transactions - is this really needed or are you trying to scalp funding by submitting all those smaller task proposals?

We’re all about automation and permissioned actions taken by the Aave DAO. We also really appreciate this format of smaller contracting deliverables within a few weeks time. As there is already a committee executing many transactions, this seems at face value unnecessary.

If this is truly necessary, can you specify how many work hours would this take or the rate per hour that ended up to 14,344 USD in GHO?

[ApuMallku]

I echo what @0xkeyrock.eth is saying here. It doesn’t make any sense to fund mini-tasks that need to be decentralized and automated in the first place. I appreciate what @TokenLogic is doing for AAVE, but I urgently encourage the founders to evaluate a more professional strategy in terms of funding. This is not the first time that TokenLogic looks odd in terms of requests for funding.

[Kene_StableLab]

While we appreciate the motivation behind the active management of the Aave DAO’s auraBAL position.

Like @0xkeyrock.eth We are equally concerned about the costs associated with developing these contracts. As the DAO takes on active management of its strategic assets, we would appreciate and expect service providers to adopt a cost-effective approach to developing these contracts.

[TokenLogic]

Hi @0xkeyrock.eth, @ApuMallku, @Kene_StableLab,

The rational for this proposal is simple. Currently, the auraBAL position is in the custody of a SAFE outside of the shortExecutor’s reach. This publication proposes creating a contract the shortExecutor has control over whilst providing the same functionality to the GLC. This is the same rational as the Aave Swap and Strategic Asset Manager contract. This proposal is a continuation of the used approach to date.

The Treasury contract can not be upgraded to maintain the strategy which creates the need for an alternative contract. The SAFE is the short term solution and the auraBAL contract is the more longer term solution. Having >$1.6M in a multi-sig is not a long term solution for the DAO.

In terms of funding, our approach is simple, recover sunk costs, presents some small scopes that we have capacity to execute and continue working on the a revised service provider proposal. We expect whoever manages the Treasury will need this tooling for reasons mentioned above. To your point though, this is our last funding submission prior to submitting a revised service provider proposal.

[lbsblockchain]

Hey @TokenLogic based on your response above - what is the urgency for this proposal? If this can be included in the budget for the revised service provider proposal then what is the need to split these smaller tasks out for now especially if it is not extremely urgent?