[reWARDS] May '22 Budget

reWARDS May 2022 Budget

May Budget Post

Welcome to the May budget.

The past month has been focused on setting up operations for new networks while continuing to explore bribes and further optimize the spend and deployment of incentives.

stMATIC is starting to scale and stDOT should be coming online later this month (fingers crossed).

This post will be broken into a few sections detailed below and will be open for community feedback for 3 days (72 hours). After which, if there is no contention, will be acted upon.

Updates for each month will be provided in the corresponding monthly threads.

The sections are as follows:

  • Operational updates
  • Budget and breakdown
  • Reasoning
  • New experiments
  • Operational Goals

Operational Updates

We will be adding Ivan as a new member of the rewards committee as a replacement for Felix, update will be forthcoming with specifics around his key and onboarding. As we handoff between Chorus One and P2P this will make sure change management is up to date.

Budget and Breakdown

The March budget calls for 4,300,000LDO.

4,045,000LDO distributed across the following pools and networks with the remaining held for unaccounted needs during the month.

I want to explicitly call out that we will be testing Uniswap V3 pools this month.

The colors correspond to an increase or decrease of LDO for the month. Blue indicates a test or new incentive.

The spend was lower than budgeted by ~430K LDO due to delayed launch of incentives on Orca (BTC, ETH pools), Atrix for Solana. The remaining is due to lower emissions for ETH Curve (250K) and Balancer bribes (100K).

Reasoning and Analysis

We are continuing to experiment with bribes and indirect incentives to increase capital efficiency.


The past month was a very static month with only about 3% growth of stSOL.

We are working to update the Solana dashboards and migrate to the new dune data sets.

Notable changes

  • Atrix has continued to be delayed due to ops and liquidity requirements. We are hoping to get that launched this month finally.
  • Crema finance launched introducing concentrated liquidity pools.
  • Orca launched their Whirlpools which is another concentrated pool option.


Bribing on Balancer had a slow start due to some gauge issues discovered on their end. That has since been remedied.

Notable changes

  • We will be testing 33% (100K LDO) of the normal rewards as bribes instead this month. Efficiency looks to be ~3.5X.
  • We have further cut back on Curve emmissions by another 500K LDO while increasing bribes by 250K LDO.
  • Curve dashboard

Terra (LUNA)

  • Astropool have captured a great amount of TVL for stLUNA and less so for stETH & stSOL due to not being the native asset, which is to be expected.
  • Astroport Dashboard

Kusama (KSM)

stKSM has been steadily growing. We are working on operational process to get an oracle price feed to allow deeper integrations in DeFi.

Polkadot (DOT)

We are hoping for stDOT to be launched this month along with the first pools. There is risk of a delay due to technical implementation requirements around XCM.

Polygon (MATIC)

stMATIC is getting ready for a broader roll out this month. We will also be launching a few new pools as we continue opening up the launch.

New Experiments

Uniswap V3 pools will be the focus of this month with incentives. Operationally complex so we expect this to be a slower rollout.

New stablecoin pools. There are a number of new multi-stablecoin pools being explored and Lido is looking to pair st-assets against them. Will update this thread with additional details.

Operational Goals

The goal is to now focus on increasing natural trading volume over the rest of the quarter while lowering net LDO emissions from the treasury for mature networks (ETH/SOL) and rotating increased spend to newer networks. While maintaining the peg is our #1 priority we are becoming more mindful of treasury management and focusing on more sustainable defi behaviors.


Hi @jbeezy - thanks for putting this together and for the hard work you’re doing for the community.

Few questions/comments:

  1. Are there any dashboards or data sets we have to quantify LIDO’s market share on non-ETH networks? Would be helpful to understand how these markets are evolving and assess the impact these rewards are having
  2. How are we thinking about these rewards in relation to the runway of the treasury?
  3. Is there anywhere that summarizes LDO spent from the treasury (outside of reWARDS)?
  4. Would you mind updating this to sum up the amount of rewards on each Network? If not this month, for next month?
  5. How are we measuring efficiency of bribes vs normal rewards?
  6. PDF link isn’t working



Hey @jbeezy I think we need to reconsider the Astroport pools from the next month.

The wewstETH and wsstSOL are not really useful in the Terra ecosystem.

I think shifting them for the bETH and the upcoming bSOL is going to be better since there are demands for those assets in Anchor and it helps the users who want to use them in Anchor without leaving the Terra ecosystem.

Also increasing bETH and bSOL pools on Astroport means bigger pool size for liquidators and so lower price impact which helps in liquidation scenarios so Anchor can look into increasing their LTV.

Hey @Aes and @Archkiwi ,

Thank you for thoughtful questions. First to AES,

  1. I will work on this with analytics. I believe we have the raw data but not something clean and easily consumed. Outside of LUNA and SOL, the other networks are extremely nascent.

  2. Treasury management and diversification is something we are beginning to work on. Candidly this has been something we are aware of but don’t have capacity to prioritize and is an area for active improvement. Rewards are Lido’s majority expense. That is why we have been focused on optimizing spend and testing bribes or potentially meta-governance (buying assets directly to replace bribes) and have been steadily reducing spend on single networks even as we are continuing to launch new ones.

  3. Same as above. Until very recently with the launch of the RCC, the only additional expenses were Izzy and myself, LEGO with a quarterly budget and protocol expansion agreements. All of which are easily accessible but not easily consumable. Again, an area we are aware of that needs improvement.

  4. Would you want the sum per month per network or the sum of each network in totality? Great idea possibly for both.

  5. We use analytics to measure the amount of token emissions gained from bribes and compare that to the amount of LDO we spend on direct incentives. Both of those are measured by the relative impact on the liquidity. For example with Curve, we have been slowly lowering direct incentives and replacing them with bribes while reducing overall pool spend and have seen a growing depth in the pool.

Since the launch of the program in Jan, we have reduced the total spend on the Curve pool from 3.55M LDO to 2.75M LDO while increasing liquidity from ~650K stETH to ~850K stETH today.


Fair point on the wewstETH and wsstSOL pools. I will bring it up with the Terra lead and committee. However, looking at Astroport, I am not sure the bETH or bSOL pools would fair much better. bLUNA is our exception simply due to being part of the Terra eco.

For bETH and bSOL those liquidations actually occur on the native chain (ETH, SOL). It is a bit technical the specific way they are built but happy to dig in more if needed.

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For bETH and bSOL those liquidations actually occur on the native chain (ETH, SOL). It is a bit technical the specific way they are built but happy to dig in more if needed.

I think for oracles they use the native chain data not sure if the liquidations happen on the native chains though. Either way there are platforms like Kuijra which allow the liquidations on Terra.

I don’t expect them to fair a lot better but in general they have more utility than wewstETH and wsstSOL. Since users who use Kujira can use those pools to swap their tokens back to UST. And those who want to provide small amounts of collateral on Anchor can use these pools instead of hoping to different chains and paying ethereum gas fees.

There is actual data to back this up too. On Terraswap the bETH pool has dialy volume of 700K when compared to the wewstETH pools 164K in volume. This is despite the smaller size of bETH pool on Terraswap. 7.33M bETH pool compared to the wewstETH’s 28.26 M.

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Hey! An stDOT notice: launch rewards were updated from 40,000 LDO to 100,000 LDO to fit market size.

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@jbeezy RE #5 Have we given any thought or outlined what might be an adequate level of liquidity? How do we define success, by variance from the peg?

If this is the largest expense line item, then I think we should have some clear targets or goals wrapped around it. Sorry if that already exists and I have not come across it.

As @Aes mentioned Regarding #2 & 3 for treasury management and financial reporting. Is there a timeline for when this function might be stood up? Do we need more FTE’s, a software solution to streamline it, a committee to handle it?

Thanks for all the hard work.

@jbeezy If it would be helpful, I would be glad to lend a hand and put together the financials for the teams review.

w.r.t. financial reporting and your question, the answer is all three.

IMHO this is one area where we need to do a lot more but don’t have the internal resources/capacity for right now, and due to the complexity of Lido it’s really better to build internally rather than rely on a 3rd party. One of Lido’s core complexities is that it’s multi-chain (and not necessarily EVM), so it’s very hard to build something that is robust and consistent without spending an inordinate amount of time on it.

That said, do you have any examples of similar reporting you’ve done for other protocols? Maybe there’s something we could do via LEGO

Unfortunately not for another protocol. However, I am an accountant / CPA and have prepared an untold number of TradFi financial statements. Happy to share credentials.

Key to any financial reporting process is methodology and standardization. With a set of standards in place, I am sure we could create a robust reporting process. While there is not a formal set of reporting standards as in TradFi, there are some resources we can refer to.

The folks at INDEX have a led the charge in robust treasury management and financial reporting. This is just their reporting thread. Lurk around and you’ll find their entire treasury process is formalized and well documented.

Llama (some of the same folks behind INDEX) have also released a number of reports that lay some ground work for financial analysis / foot notes that provide much needed commentary.

I don’t know if LEGO is necessary at this juncture, but the community would benefit from even incremental progress towards a 1 page report. We should not let perfection be the enemy of good.

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Happy to pitch in on my end as well. I’m part of a small consulting group that works with a few DAOs that we are passionate about and strongly believe in.

As a heavy bagholder of LDO and someone who’s already built some models for LDO, would love to help out :slight_smile:


Note on motion #182. Lido has set up another Curve pool Curve.fi with high A coefficient to ease up price pressure on the bigger pool (Curve.fi). As the rewards on the new pool are to be renewed this Thursday, the motion for funding of 500,000 LDO has been started.
Lido Easy Track

No update to Solana pools yet?
I still see 1667 LDO per day in Saber pool.

Update regarding Astroport pools

The recent events have left Terra far less secure: although delegations have been disabled, the economic security of the network is at an all time low. Theoretically, the top 10 validators could unilaterally halt the network. This creates a situation where operating on Terra requires extreme trust.

We have worked very closely with many of Terra’s validators, and are convinced of their benevolence. Nonetheless, given the state of the network, we do not believe it is prudent to maintain foreign assets on Terra, nor to deploy treasury funds to incentivize liquidity. We will thus be pausing weLDO rewards on four Astroport pools:

  • stLuna-Luna
  • stLuna-weLDO
  • wewstETH-UST
  • wsstSOL-UST

The remaining weLDO tokens will be withdrawn to the reWARDS multi-sig on Ethereum. LDO rewards may be redeployed once the dust has settled and the DAO is able to make an informed decision.

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Update on the concentrated pool lp rewards: Incentives for concentrated stETH/WETH curve pool

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@Izzy is there an address directory of sorts I can refer to when putting together this package?

Short term - I am exporting from Etherscan and manually cleaning, arranging. It would be helpful if there was something I could refer to that documented who or what an address belongs to. I am referring back to Aragon and this forum to clarify what each transaction is for, but it is LABOR INTENSIVE. A key would be very helpful to speed this up.

Long term - I wrote a python script from Etherscan’s API to extract the activity into a DataFrame. Once there is some consensus on what the excel based financial ought to look like, I will format the DataFrame into a set of financials. I am happy to consider other routes here as well. There are some inherent flaws in this process as the DAO expands, but it should speed up the reporting cycle going forward 100x.

@McNut I know it’s labor intensive, and I’m guessing that’s just for 1 protocol out of the 5 that we support; this is why I mentioned the complexity and lack of time+resources internally for this. It’s also really difficult to pick up expenses that have been born by 3rd parties and then reimbursed by the DAO at a later time, or figure out all the different LEGO-related expenses.

If you want to take this on yourself it’s probably best to hop in our discord – I’ll see if someone from our analytics team can jump in to help give you some basic info. There’s no address directory apart from the contracts that are listed in the docs (e.g. Deployed Contracts | Lido Docs) for each Lido on X protocol.