[DRAFT] Budget Board Advisory Proposal for Token House Missions: Seasons 8

[MSilb7]

Hi everyone, sharing a draft proposal for the season 8 token house budget. Please provide any feedback/questions/pushback today & over the weekend! The budget board
aims to finalize a proposal on Monday (Jul 14, 2025).

---

Summary

Proposes a 9.18M OP budget across 2 Governance Fund missions, a 13% decrease versus Season 4-7 average (10.5M OP / season). This proposal aims to balance increased runway with the strategic importance of the interop product launch.

The general structure was to generate a baseline allocation per mission, based on a combination of prior comparable proposals and a target 10 year runway, then adjust allocation based on factors of strategic importance, ROI confidence, and funding intensiveness.

Each mission proposes to have an “above baseline” allocation; however, this should be rare since season 8’s goals are focused on a highly important product launch, Superchain interop.

Season 8 Governance Fund Mission Budget Proposal
See Methodology, Baseline Analysis, Budget Calculation sections for detail

Mission	Proposed Budget
Grants Council	7.98M OP
Developer Advisory Board	1.20M OP
Season 8 Total	9.18M OP

Strategic Rationale

• The Governance Fund should be managed to last for an extended period of time with the current token allocation. Continuing the rate of spend for the modern missions-style seasons (4-7) would only last for 4.5 more years (9 seasons).
• It’s extremely difficult to measure ROI of past grants or attribute impact to funding alone. Additionally, timelines for results often extend beyond seasonal cycles, and success or failure of prior spend does not promise the same result for future grants.
• The Governance Fund is used for proactive funding, but demand for proactive funding isn’t consistent. Some seasons need more, others less. The process should be flexible to adjust up or down.
• We want to avoid both “use it or lose it” dynamics and “easy money” behavior.

Methodology

Estimating Baseline OP per Mission

To extend the lifetime of the Governance Fund, we can work back from an expected runway to get a target per season. Then, we can use historical spend to roughly allocate between missions within this target.

1. Generate a Baseline OP per Season

• Baseline OP per Season = OP Token Allocation Remaining / Target Seasons of Runway

2. For each S8 mission, find benchmark budgets for prior successful missions.
3. Use the benchmarks to determine percent allocation of the Baseline OP:

• Baseline OP per each Mission = [Benchmark OP for the mission / Total Benchmark OP across S8 missions] * Baseline OP per Season

Scaling Each Mission’s Budget

To handle for some seasons and missions requiring a greater or smaller budget, we can score missions based on a set of criteria in order or to scale the amounts up or down (similar to the Retro Funding proposal).

We assume that every mission proposed has some significant level of importance, so these scores reflect and skew up or down relative to historical benchmarks (e.g., -5 score doesn’t mean something is “bad”).

Score missions based on a set of 3 criteria to increase or decrease the budget for that mission. Scores were an average of budget board members’ inputs.

1. Strategic Importance: How much more or less influential do we expect this mission to be towards long-term Optimism success.
2. ROI Confidence: A governor on spend. Is this mission highly experimental, or do similar missions have a strong record of proven results?
3. Funding Intensiveness: Another governor on spend. If the mission is naturally more funding intensive than prior benchmarks (e.g., new infrastructure spend, increased competition), then the budget may need to be larger.

These can be scored from -10 to +10. This allows for at most a 4x increase above baseline (+30 = +300%). Assuming that all missions proposed have already been deemed important enough to fund, we can cap the downside at a 90% reduction.

See Appendix for sample descriptions of scores.

Baseline Analysis

Baseline Mission Budget

• 124.33M OP remaining (Source: OP Token Unlock Sheet as of Jun 19 2025)
• Assume a 10 year runway.
  • This target can change over time, 10 years roughly doubles runway versus the prior pace.
• 23M held out for DAO Operating Budget (estimated 2.3M OP per year * 10 years)
  • 101.33M OP spendable
• 5.07M OP Baseline OP per Season
  • 101.3M OP spendable / (10 years * 2 seasons per year)

Budget Calculation

Baseline OP per Mission

Note: In season 7, audits (900k OP) came from the Grants Council budget, but in season 8 this is reallocated to the Developer Advisory Board budget

Mission	Comparable Budget	Share of Total	Baseline OP per Mission
Grants Council	9.0M OP in Season 7	87.5%	4.433M OP
Developer Advisory Board	1.285M OP in Season 7	12.5%	633k OP

Mission 1: Grants Council

Proposed Budget = 7.98M OP

• Baseline = 4.433M OP, Multiplier = 1.8x

Mission 1 Scoring

Factor	Score	Reasoning
Strategic Importance	+6	Interop-ready TVL should help make Superchain Interop more attractive at launch.
ROI Confidence	-2	Results are not guaranteed, any growth program is experimental; however, there is experience from prior seasons.
Funding Intensiveness	+4	It is a highly competitive environment, which may require increased funding in order to be relevant.
Mission 1 Total	+8	1.8x Multiplier

Mission 2: Developer Advisory Board

Proposed Budget = 1.20M OP

• Baseline = 633k OP, Multiplier = 1.9x

Mission 2 Scoring

Factor	Score	Reasoning
Strategic Importance	+5	Interop-enabled apps may become a strategic differentiator for the Optimism Collective.
ROI Confidence	+2	Balancing the importance of audits with experimental interop-enabled app programs.
Funding Intensiveness	+2	Anticipated increased audit expenses and competitiveness for developers.
Mission 2 Total	+9	1.9x Multiplier

APPENDIX: Descriptions of Score Ranges

Sample Descriptions of Score Ranges

Factor	-10 Score	0 Score	+10 Score
Strategic Importance	Mission is substantially less critical than prior missions. We expect little to no relative impact.	Mission is just as important as prior missions.	Mission is far more critical than prior missions. This is make or break.
ROI Confidence	Mission is 100% experimental, we’re throwing things against a wall and seeing what sticks.	There is a strong hypothesis that this mission will have positive ROI.	There is a strong track record of similar missions providing exceptional results.
Funding Intensiveness	Mission requires substantially less funding than prior missions.	Mission requires a comparable amount of funding as prior missions.	Mission requires substantially more funding than prior missions.