The grant size requested is extremely high for a project with no TVL or presence on Optimism. Impermax currently has about $2m TVL on its biggest chain (and <$5m total TVL) according to DeFi Lllama, whereas the requested grant size is valued at $600k based on current OP market prices.
Impermax’s TVL on Polygon chain is <$1.8m according to DeFi Llama. Even if all the users migrate from other chains, it is unlikely that the migration of new users to Optimism will be worthwhile from a grant size vs. projected benefit perspective.
Also, what’s to stop a similar “migration process” from Optimism toward another chain’s incentives program? This proposal states that users will stay after the OP incentives dry up and offers the TVL on Polygon as proof, but also intends to use OP incentives to migrate the TVL from Polygon to Optimism.
This suggests that liquidity is not sticky and demonstrates a willingness to migrate users from chain to chain (should the opportunity arise for a grant from another chain).
Looking at a few of the strategic pairs mentioned, Beefy (autocompounder for Velodrome) and Tarot (autocompounder and leverage yield farming for Velodrome) already have $2.9m and $2.5m TVL respectively in just three pairs: ETH-USDC, OP-USDC, and VELO-USDC. Both are also partners with Velodrome. Using an OP grant to incentivize the same pairs seems likely to reach only mercenary users in a crowded field at this point, rather than bring new users to Optimism. Incentivizing IBEX-ETH and IBEX-OP also does not seem like a worthwhile use of an OP grant.
Since Uniswap V3 is a ways out, it does not appear the OP grant will be used to incentivize a Uniswap V3 integration based on the estimated timeline. Instead, it looks like the OP grant will be used to incentivize a virtual copy of other established projects on Optimism that already offer autocompounders, lending, borrowing, and leveraging for Velodrome. As it stands, the leveraged farming value proposition is not novel.
Why not request an OP grant after first demonstrating some success on Optimism, for example, with a novel development such as Uniswap V3 integration?
As a reminder while grant evaluations are being finalized, grant distribution is as follows:
Should a grant plan be approved, the applicant will receive 40% of total funding. In order to unlock the remainder, critical milestones must be met. Please make sure that you are comfortable with your critical milestones and that they will be easy to verify. It is also advised (where appropriate) to be prepared to submit documentation that the milestones have been met to avoid delayed disbursement of the remaining funds.
If you are comfortable with your milestones, then no additional action is needed.
