Utilizing Market Opportunities: stETH / LDO trade

[lidoecosystem-ops]

@StefanGeorge

I am in favour of this proposal, but I want to make two remarks:

1. For the execution, the goal should be to buy as much LDO as possible with as little stETH as possible. Buy out the weak hands first. For this, I am recommending setting up a TWAP order on CoW, which can be easily done from any Safe, executing much smaller orders but more frequently, leaving no significant arb opportunities to others. CoW is using 1inch, Uniswap, etc., under the hood to settle the trades.

2. For the price to pick up long-term and investor sentiment to be positive, there should be a longer-term execution plan. E.g., use x% of revenue to buy back on a regular basis instead of a one-off situation, where investor sentiment will cool off once the buyback is done.

Thanks for the support.

CoW Swap TWAP is indeed an option within the execution framework and may be used where it makes sense. It works well in conditions with sufficient solver participation. The overriding objective is exactly as you frame it: maximise LDO acquired per stETH spent, within the slippage limits.

While this proposal is a one-off initiative, an automated, programmatic long-term mechanism is under R&D at the moment. The design assumptions behind it was explained in the latest tokenholder call and updates will be published in the the NEST proposal thread when available. This proposal is not a substitute for the longer-term framework NEST is designed to provide.