Sushi x Pool Together - Optimizing Treasury Management and Community Engagement

What is this all about?

Combine efficient treasury management and community engagement by depositing the USDC sitting idle in Sushi’s OPS treasury (1.7M USDC) into PoolTogether.

Using PoolTogether’s Deposit Delegator, portions of this deposit can be delegated to chosen community members, granting USDC prizes on behalf of Sushi without losing custody over the underlying funds.

Why should we do that?

  • Gain a sustainable, liquid, and safe source of yield on USDC (powered by Aave), payable in USDC (currently sitting at >8%)
  • Expand on a collab initiated a year ago and benefit from cross-communication opportunities between PoolTogether and Sushi
  • Set a precedent for DAO treasury management while the topic is hot
  • Advertise that Sushi is well-equipped for a lasting bear market
  • Engage the Sushi community and reward productive contributions to the ecosystem

All via PoolTogether’s Deposit Delegator, a 0-cost engagement tool

Current status?

Pedrowww has reached out to I’m Software and Jiro on Sushi’s side, as well as Tim, Tjark (Community Lead), Taliskye (Grants Committee) on PoolTogether side. All parties are on board with the idea.

Next steps:

  • Choose the chain(s) to deposit on: Polygon recommended, Optimism next (Avalanche and Mainnet are also available)
  • Select wallets allowlisted to manage a delegation without having access to the deposit
  • Set the amount to be deposited

Out of the total deposited amount, a certain % could be used for delegation, while directing the remaining part to the Sushi treasury. This way, Sushi could combine passive income and community incentives. Win-win!

Use case #1: Community

Sushi is partially powered by some of its volunteers. Without any form of incentives, it’s difficult to reward their contributions and inputs, and keep them engaged.

Using Pool Together’s delegation tool, Sushi would benefit from a 0-cost incentive. It would simply delegate some of its deposit (ex $20K for 4 weeks), while retaining full custody over the underlying assets. Contributors can then self-collect the prizes won over the delegated period or Sushi can claim them on their behalf and cover gas costs.

The delegation offers flexibility over the delegated amount (could have different tiers like $50K, $25K, $10K) and delegated period.

Delegation incentives could be a way to overcome the clunkiness of governance when it comes to rewards. Since delegations don’t affect the treasury, it would make sense that Sushi OPS retains full control over how they are distributed.

In order to utilize the full potential of delegation, it is important to list what contributions are worthy of a delegation (on-chain voting, activity on Forum, participation to community events, contributions, etc…). I’ll be exploring this with the Samurais and Trudahamzik in particular.

Use case #2: Comms/Mkt

The recent market slump has put the limelight on the importance of sound treasury management. Protocols that were able to secure some of their treasury and can prove they have enough runway to operate through years of depressed price action will have a competitive advantage.

PoolTogether and Sushi are both community-driven and user-centric. By advertising its deposit in PoolTogether, Sushi is not only sending a positive signal by reasserting the power of DeFi composability, it is showcasing its financial health (how else would they have that much “disposable” income).

Using delegation, Sushi would also spearhead an innovative alley of community incentives.

The delegation could be used for a number of additional promotion purposes such as contests. People tend to respond positively to concrete prizes and $ amounts. It would probably need a little bit of education but nothing that a small tutorial couldn’t fix.

Dev Resources

  • Great idea! Let’s put Sushi’s USDC to work!
  • Interesting idea but I have reservations (please share which in the comments)
  • Nope. Not interested.

0 voters

3 Likes

Hey friends,
Tjark from PoolTogether here! :wave: Excited to see you bringing this forward.

Let me know where I can help. Happy to answer any questions!

3 Likes

In the past, I advocate multiple times to put a % of the treasury funds to work. The reason is that it would help SushiSwap in the long term. So, I am all for it.

I have some concerns about side chains because during bull runs or bank runs the side chains can clog up.Therefore, the mainnet would be the safties route.

I would also like to see Sushi’s ETH a (%) put to work, maybe in a Tokemak reactor. @JiroOno

I would also like to see @BoringCrypto opinion about this proposal.

Thanks for the write up, but I must be missing something. Is Sushi loaning USDC to a delegate? If so, how can we guarantee the return of principal?

Understand the concept of depositing excess reserves into Aave for others to borrow, but could you clarify how using delegates and the PoolTogether platform fit into this?

PoolTogether has a feature that allows to delegate parts of a deposit to other wallets without losing custody over the underlying funds.
Sushi could deposit some of their USDC holdings into PoolTogether (protocol is fully non-custodial) and choose to delegate parts of it to contributors of the community.
This way Sushi could
a) grow their treasury by winning prizes, and at the same time
b) delegate parts of the deposit to community members, making them win prizes, too!

1 Like

Thank you for writing this up @Pedrowww ! We would love to see this happen from the PoolTogether side. Happy to answer any questions as well! :slight_smile:

Jumping back in with a quick update: PoolTogether has received 450,000 OP tokens which will be distributed to depositors on Optimism over the coming weeks.
Delegatees (addresses that are being delegated to) are eligible for these as if they had a deposit themselves. This adds guaranteed OP rewards to the chance of winning USDC prizes!

Could be a fun way to reward Sushi governance participants with Optimism governance tokens.

How can I help to get this to the next level? :slight_smile:

1 Like