Summary
Since the PoolTogether protocol launched on Optimism, PoolTogether Inc has received two grants. Grant 1 (450,000 $OP) through the Foundation Fund. Grant update here. Grant 2 (550,000 OP) through Token House Season 2.
This thread updates on the performance of grant 2 and next steps.
Usage of $OP & Results of Grant 2:
Grant 2 had three goals. The first and most important goal was growing deposits and depositors while reducing overall $OP distribution. This goal was accomplished. Grant 2 reduced the amount of $OP tokens being distributed to depositors by 30% (from 27,500 per week to 20,000 per week), while reducing OP distributed total deposits actually grew to $40 million. Growing deposits from $35 million to $40 million while reducing OP distribution was the stated goal of grant 2. The recent USDC depegging did create a large amount of withdrawals. However, the protocol has still outperformed the general downturn of USDC and is recovering.
The second goal of the grant 2 was to grow unique depositors from 10,000 to greater than 30,000. This goal was again successful, there are currently over 35,000 unique depositors into PoolTogether on Optimism.
In addition to these metrics based goals, grant 2 asked for OP tokens to help build an alternative interface and new yield source integrations. Two alternative interfaces have been built, the first is PoolyGotchi, a gamified interface to set and achieve personal savings goals. The second RetroPooling is a simple interface for smart contract wallets that allows one-click no loss donations to RetroPG.eth.
For the yield source integrations, the OP tokens allocated have not yet been distributed as the core prize pool is being upgraded to be ERC-4626 compatible and yield sources will make more sense to fund after that is completed.
In total, 550,000 OP tokens were given in grant 2, 400,000 of those have been fully distributed. The remaining tokens are retained for the goals discussed above.
Looking Forward:
PoolTogether has delivered on the promise of being the “front-door to DeFi” on Optimism. It continues to stand out as a simple, secure, and financially healthy place where people can try Optimism for the first time. From there, they can use more mature DeFi tools and other apps built on Optimism.
Grant 2 showed the protocol can significantly grow while reducing reliance on incentives. However, although PoolTogether did show strong growth, the overall low interest rate environment caused by the bear market has prevented the growth flywheel from fully taking hold.
PoolTogether Inc is currently working on the “hyperstructure” upgrade, this will make the addition of new yield sources and token types permissionless. Our belief is this will address the current limitations the protocol has and allow the growth flywheel to take hold.
With that said, there is still meaningful work needed to be done before that milestone is reached. Expected delivery of the fully audited production version is July 15th, roughly 4 months from today. This leaves a roughly 15 week gap between when the grant two OP rewards will end and when the upgraded protocol will be ready.
PoolTogether Inc will be applying to the foundation for a third grant. The goal of this third grant will be both continuing the current value proposition of PoolTogether V4 and also jump-starting the growth of the hyperstructure. We ultimately believe the hyperstructure will drive the best long term growth on Optimism.
We welcome feedback! We are interested in hearing if others in the community believe an additional grant is warranted and how it should be used!
Appendix: Grant 2 OP Incentive Distribution Schedule
- Project Name: PoolTogether
- Affiliated Project (if applicable): PoolTogether
- Distributor contract address: 0x1470c87e2db5247a36c60de3d65d7c
- Announcement Date: November 11, 2022
- Announcement Link: Mirror Article / Medium Article / Tweet
- Start Date: November 15, 2022 (extension)
- End Date: March 28, 2023
- Distribution Type: TWAB Rewards
- OP per Epoch: 20,000 $OP
- Epoch Length: per week
- App Incentivized: app-unspecific, incentives on smart contract level
- Contract(s) Incentivized: Yield Source Prize Pool
- Action(s), Pool(s), etc. Incentivized: Average balance & share of the prize pool over time
- Eligible Addresses: All depositors on Optimism
- Extra Notes: Distribution statistics can be seen here.