[Grant Proposal] Galleon DAO x AAVE Protocol

Summary

Following the success of Galleon’s ETH Max Yield Index ($ETHMAXY - $4.3m TVL) structured product that uses the AAVE v2 adapter, the DAO is seeking a grant to build the AAVE v3 adapter which is required for our follow up product: MATIC Max Yield Index ($MATICMAXY).

Abstract

Galleon in collaboration with Beverage Finance successfully launched the ETH Max Yield Index (current TVL $4.3m) after stETH’s addition to AAVE, this product was followed by a number of similar products in the market including icETH by Index Cooperative which replicated our strategy a month after our launch and which has $14.6m TVL.

With the announcement of stMATIC proposal to be added to AAVE: Proposal: Add Support for stMATIC (Lido) Galleon has already begun working on the product specifics for our follow up product the MATIC Max Yield Index ($MATICMAXY) however this requires engineering development of the AAVE v3 adapter.

Therefore Galleon is requesting a grant of $150,000 to help the team with costs to build, test and audit the AAVE v3 adapter for Set Infrastructure so we can create additional structured products that will utilize AAVE.

Motivation

We believe $MATICMAXY will be just as successful as $ETHMAXY and will bring millions in TVL that will be utilizing AAVE collateral services (and therefore a net positive for AAVE), we can almost guarantee that Index Coop will again launch a competing product that will require the same v3 adapter which could mean an additional $20m TVL (total between both products utilizing AAVE). It will also provide an opportunity for future products that will require the v3 adapter as well.

Specification

Implementation:

Dev effort/time is 4 weeks (total delivery time: 5 weeks, breakdown below).

Our Developers have a solid understanding of aave-v2 and aave-leverage-module, which helped us develop and deploy ETHMAXY.

Timeline:

  • Week 1: Read documents and understand AAVE v3.
  • Week 2: Design the module and write STIP.
  • Week 3: Implement, unit test and integration test.
  • Week 4: Write deployment scripts and complete on-chain testing.
  • Week 4-5: External audit (starts in parallel with on-chain testing).

We have already applied to the Aave Grants DAO and had our final interview with Shreyas, this is our proposal since the grant is above the $100,000 rapid grant threshold.

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Hi @duck,

This reads like a clean scope of work, but given the value of the ask, I think further details are needed.

Can we please get a breakdown of the $150,000 funding request, perhaps itemise it out showing man hours and rates ? Perhaps a TVL and payback period for the Aave Community would be helpful as these products will generate revenue for the Aave Community.

At $30K per week, this annualises out at $1.56M. So there must have several developers working on this full time to make this timeline achievable. Any chance you can do similar to Bored Ghosts Developing and Risk DAO proposal, by sharing who these people are here ?

Given stMATIC is on Polygon and there are several Index Coop FLI products built on Aave V2 on Polygon. Is it fair to assume that naturally TokenSets V2 needs to migrate to Aave V3 in time. Is this something already in Set Lab’s / Index Coop’s roadmap ?

My thinking here is the Flexible Leverage Product offering needs to migrate to Aave V3 and that would reduce the lift required to do leverage staking yield farming. I also believe Instadapp is providing a similar type of product, already offering yield on USDC, ETH and WBTC. I don’t think Instadapp applied for funding like this and these products are all somewhat competing for TVL.

Disclaimer: I am involved with Index Coop and Index Coop has submitted small grants in the past, each being <$30K.

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Hi @MatthewGraham

Appreciate the response, but not really concerned about what index roadmap is, we know it’s not on Sets immediate roadmap and we can bring it to market faster then IC. Also please could you leave the discussion to the Aave grants team since we’re already well into the process with them - thanks

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To the AAVE grant team,

Regarding a breakdown of the funding:

  • We have our two Senior Solidity engineers working on the adapter for 4-5 weeks which is what the 100k will be used for:

$10-12.5k p/w per developer, which isn’t unreasonable considering the engineering lift.

  • The remaining 50k will be for external audits (this amount was increased from our original grant submission, it was amended as per @davidev.eth suggestion as these carry a significant and usually an underestimated cost).

I appreciate that Index may have previously only asked for grants of <30k, however that isn’t a fair comparison when they are significantly reliant on Set for their engineering and are not proactive in their development of technology (like adapters) as highlighted by Set in point (5) here: Index Coop Open Letter - Leadership & Governance - The Index Coop. At Galleon’s very core we’re an incredibly fast-moving DAO, who aggressively pursues narratives and products that we think will bring significant value to Galleon and its partners (AAVE in this instance). This grant will help massively in continuing to enable us to execute that.

The v3 adapter not only paves the way for the creation of products like MATICMAXY and icMATIC, but it will also mean other (new and existing) products can move to the V3 adapter as kindly pointed out by Matthew. (e.g. Flexible Leverage Index Series)

Given that MATICMAXY has already received confirmed cross-promotion from Lido, Polygon, Set (and potentially AAVE), we expect it to be a very successful launch for both Galleon and AAVE.

Thanks,
Davy

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