GM Optimists,
We wanted to provide the community a comprehensive update on the allocation and utilisation of the 900,000 $OP grant that we received from Optimism last year as part of the Phase 0. (Here’s the proposal for the same) Your generous support has played a crucial role in advancing our vision for Polynomial, and we are excited to share the progress we have made since then.
What we have been upto since receiving the grant?
The grant extended by Optimism has not only fuelled our progress but also defined our path forward. When we received the grant, we were building Earn Vaults for traders to put their assets in, at that time we attracted 63,000+ users to the Optimism ecosystem.
While the journey was rich in learning, our evolution led us to collaborate with Synthetix, and create a seamless perp trading platform. As of this update, we recently surpassed $2 billion in total trading volume, with a robust 20% market share across all perpetual products. These achievements underscore the trust placed in us by Optimism.
As we celebrate these achievements, our focus is on the road ahead. Exciting innovations, partnerships, and a strong dedication to shaping DeFi on Optimism await. Our journey is a team effort, and we’re thrilled to keep building together along with our amazing community.
You can go through all the metrics for Perpetuals in the dashboards below:
Dune Dashboard for Polynomial Trade
Dune Dashboard for Synthetix Perps
How have the OP tokens been distributed so far?
Retroactive Airdrop
Amount : 180,000 $OP
Criteria : Existing users of Polynomial Earn Vaults
Status : Done 
Etherscan (9th November, 2022):
The motive with this retroactive airdrop was to reward early users for their valuable feedback and support. We have distributed all of the allocated OP but only 55% of the the OP sent to the contract has been claimed by Earn Vault users since the announcement. Since it’s been sent from our account to the contract, even though unclaimed for now, there’s no way for us to get it back. Earn users can still claim their rewards here.
Liquidity Mining
Amount : 450,000 $OP
Criteria : Future users of Polynomial Products
Status : Ongoing 
Remaining Allocation: 278,822 $OP (as of 23rd Aug, 2023)
Our focus with this portion of the grant was on incentivising product usage within the Optimism network. Specifically, we had planned to use liquidity mining rewards for future Polynomial’s vault users on Optimism.
We had four Earn Vaults live at the time of grant deployment, and had planned to distribute the $OP tokens to these vaults equally for approximately ~1-2 months. Though initially intended, liquidity mining for Earn Vaults didn’t materialise due to unique considerations. The vaults had a bottleneck on deposits even without incentivisation. We would be simply wasting $OP and contributing to sell pressure by having idle deposits so we chose to postpone to a more suitable time
The only instance of usage of these funds for liquidity mining was for our gamma vault pilot, which didn’t yield anticipated results as it was still in its beta phase. We opted to reimburse users of approximately 13,000 $OP before the shutting down the vault.
Since we ended up shutting down our vaults product before pivoting to Perps. This portion of the grant was reallocated to helping us grow our Perpetuals product.
We launched our inaugural Trading Season on July 4, 2023, which has proven to be a remarkable triumph in attracting new users to Optimism and enticing traders to transition from other platforms to Polynomial. You can find more details about the Trading Season in this tweet.
Before the launch of the Trading season, our daily trading volume stood at $500,000. Since then, we’ve reached an all-time high (ATH) daily trading volume of $350+ million with a cumulative volume of $2.5B+.
Trading Season
Traders are earning XP points based on their trading activity, which then translate into OP rewards, both from Synthetix and us, depending on their trading level. These OP rewards are made possible through the Liquidity Mining grant that remained unused.
The outcome of the trading season has far exceeded our initial expectations. In the six weeks since its inception, we’ve already distributed 158,000 in $OP rewards. With a few more weeks remaining for the trading season to conclude, we anticipate granting additional 50,000 $OP/week approximately to traders as outlined in the rewards structure based on the volume trend that we are on.
In addition to trading rewards, we conduct weekly trading competitions tailored to specific levels, offering substantial incentives. These competitions are structured with a leaderboard, and rewards are based on traders’ Profit and Loss (PnL) as well as their ranking among peers within the same level.
As of now, we have completed five Trading Competitions and distributed 29,500 $OP to top traders:
- Warm up Competition for 1,000 $ OP
- Level 4 Competition for 2,000 $ OP
- Level 5 Competition for 5,000 $ OP
- Level 6 Competition for 10,000 $ OP
- Level 7 Competition for 11,500 $ OP
Quick look into the leaderboard for these competitions. You can also check the live competitions along with the current leaderboard here.
The distribution of $OP rewards has been facilitated through the utilization of two additional addresses as intermediaries. These addresses serve as forwarders, connecting to the multisig wallet that initially received the grant funds.
- 0xa5A0CE7D84025f986568356475451E31714B4C95
- 0x29a66373b0c424eef1e7adf9cd9f059c8277da1e
P.S. We’ve used the same address for granting purposes, such as Li.Fi, which we will talk in detail in the next section.
You can find detailed information about liquidity mining and their utilisation in the attached spreadsheet: Polynomial OP Grant Overview
Grants
Amount : 128,580 $OP
Criteria :Contributors / Bug Bounty / Tooling / Hackathons (20% for early builders and 80% for future rewards)
Status : Ongoing
Remaining Allocation: 98,885 $OP (as of 23rd Aug, 2023)
Since receiving the grant, dedicated community members have been actively engaged in shaping and enhancing the Polynomial platform. The funds earmarked for grants have been distributed to a diverse set of projects and initiatives, all of which align with Polynomial’s overarching mission and objectives. Here’s an overview of the specific projects that received support:
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Hackathon Sponsorship: We provided grants to encourage innovation through hackathons and Web3 Meetups enabling creative minds to build and contribute to the growth of the Polynomial ecosystem.
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Explainer Videos: Grants were allocated for the creation of informative explainer videos. These videos play a crucial role in simplifying complex concepts and promoting wider understanding of the platform.
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Content Creation Contest: We’ve organised several content creation contests, inviting the community to craft diverse content such as YouTube videos, Twitter threads, or Mirror blogs about Polynomial. Through these contests, participants help amplify awareness of Polynomial’s mission and functionalities across their own networks.
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Dune Dashboard for Analytics: A grant was dedicated to the creation and maintenance of a Dune Analytics dashboard. This provides us with insights into the performance and trends with the Polynomial product.
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Quests: Funds were allocated for the development of quests, an engaging approach to involve a broader audience and showcase the unique offerings of the Polynomial protocol.
These quests have given us a big boost in terms of new users coming to Optimism and Polynomial. Some of the partnership quests that we ran:
- Floki:** All the $FLOKI holders who hold $10k worth of token were whitelisted to level 3.
- Jumper Exchange: Bridge and trade on Polynomial and have a chance to win from a $400 raffle prize pool.
- Liquity: Deposit 100 $LUSD on Polynomial and trade a minimum of $500 in volume and get a chance to claim the exclusive NFT.
- Stader: Stake 50 MATIC on Stader and trade with at least $500 on Polynomial to get a chance at winning from a $200 raffle prize pool.
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Zapper and Other Integrations: Grants supported the integration of Polynomial with platforms like Zapper, making it more accessible and convenient for users to interact with our ecosystem.
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Discord Bot: A grant was given to develop a Discord bot which answer queries and answers for the traders, hence enriching the community experience by facilitating easy access to information and resources.
You can find detailed information about the grants and their utilisation in the attached spreadsheet: Polynomial OP Grant Overview
We will be using remaining allocation of $OP for ongoing and future grant initiatives and will be updating the above shared sheet as we disperse newer grants.
These grants aim to engage a wider audience and amplify the benefits of Polynomial. Throughout this journey, our primary focus remains on advancing our product for the betterment of the Optimism community.
Building Blocks
Amount : 72,000 $OP
Criteria : Be an LP in Lyra
Status : Done
The capacity of Polynomial Vaults was directly proportional to the liquidity in Lyra. At that time, Polynomial Vaults were almost operating at full capacity due to the inability to increase the vault size. We had thought that Incentivising LP’ing in Lyra would help us raise the vault capacity and in turn help us bring more users to Optimism and to us.
Our experience with the grant taught us a valuable lesson. We were a bit inexperienced in this area and didn’t achieve the desired outcome.
Lyra team can comment on this further.
Frens of Polynomial
Amount : 69,420 $OP
Criteria : Be our fren
Status : Done
Etherscan (15th August, 2022)
- Synthetix : 0x5248be8b6c9b7257695275ebd7c3918326151ae6
- Lyra : 0xb6dacae4ef97b4817d54df8e005269f509f803f9
- Perpetual : 0xacb6bb3c0776e1bb4fce122f7c94bf50caaea62f
- Kwenta : 0x82d2242257115351899894ef384f779b5ba8c695
- Pika : 0xa6200c2bf2ce83b32c4c1a7345888e75ab64f0e3
- Thales : 0x489863b61c625a15c74fb4c21486bacb4a3937ab
We love Optimism and are optimistic about the derivative ecosystem being built here. So we paid 11,570 $OP each to the core devs of Optimism Native Derivative Projects like Synthetix, Lyra, Perp, Pika, Kwenta and Thales.
What’s next for Polynomial?
The Optimism grant has been a game-changer, helping us achieve remarkable milestones and grow our community. A big thank you to Optimism for their support; we couldn’t have done it without them.
Looking ahead, we’re committed to making even more progress and bringing innovation to the forefront. We’re excited about the future and can’t wait to keep pushing forward together.
We recently launched a way for Polynomial Traders to to open delta neutral positions on Polynomial and Aave platforms with just 1-click, traders can seamlessly capitalise on funding rate discrepancies. The strategy is currently available only for the ETH market and is in beta but you can check it out here using the password: “arb”. We are also preparing for the launch of Perpetuals V3, an exciting advancement that’s just around the corner! Follow us on Twitter to stay tuned for more updates.
If you have any questions or require additional information, please feel free to reach out to us.
Thank you once again for believing in the Polynomial and for your invaluable support. LFG 
