[READY] [GF: Phase 1 Proposal] Beefy

Beefy Incentive Proposal

Project Name: Beefy

Author Name: @frondoto

Number of OP tokens requested: 650,000 OP

L2 Recipient Address: 0x4ABa01FB8E1f6BFE80c56Deb367f19F35Df0f4aE

Deployed on Optimism: Yes, on 27/06

Relevant Metrics:

TVL: $268,000,000 across 16 different blockchains
TVL in Optimism $10,000,000 (Link to DeFi llama for the latest number)
Site: https://app.beefy.com/

Optimism alignment (up to 200 word explanation)
Beefy is the multi-chain yield optimizer known for its high security standards. Every protocol that gets listed on Beefy passes strict safety checks to ensure the platform where our users are depositing is safe. This frequently results in Beefy joining talks with these teams, helping them adjust their security measures, and most of the time partnering with the underlying protocol, making it known to our vast multi-chain audience.

Beefy also has a multi-chain app. This means that the opportunities across 16 different chains can be compared side by side to choose the best place to put your tokens to work.

Beefy’s users are quite diverse, but what they all have in common is that they have been priced out of Ethereum. Deploying Beefy on Optimism allows those users to enjoy the safety of Ethereum, without paying the high gas prices.

We gathered feedback from different delegates and they required us to deploy on the chain and gain some traction, which we did. Currently Beefy has 23 different vaults auto-compounding more than $10,000,000 of TVL. We have vaults for BeethovenX, Velodrome, Stargate, Curve, just to name a few.

At the time of writing this we are in talks with 4 different protocols on Optimism to partner with them and multiply even more the effect of the incentives. One example of this is Qidao, their protocol utilizes mooTokens (interest bearing collateral) to allow users to mint MAI and leverage their position. This will be possible since Chainlink is already deployed on the chain.

Proposal for token distribution (under 1000 words)
How will the OP tokens be distributed? & How will this distribution incentivize usage and liquidity on Optimism?

After deploying on the chain and working with its protocols we encountered impactful ways to get the incentives to work.

35% of the OP tokens will be used to incentivize a BIFI-OP farm. Having this farm is vital to offer our complete product to Optimism users. Beefy distributes the earnings of the platform in the form of , and we have a BIFI Maxi vault which auto-compounds the ETH for BIFI daily. In order to offer that vault we need liquidity on that pair. To do this we are considering bribing veVELO holders, or doing co-incentives with BeethovenX. We will distribute these in between 12 and 18 months. After this rewards run out we will bring to the DAO the decision of continuing the rewards with Beefy Optimism treasury.
Edited this bit to be the pair BIFI-OP as @OPUser suggestion. Having BIFI on an LP is enough, we don’t need it to be ETH, and having OP instead makes a lot more sense. We are encouraging BIFI holders to research and learn about OP (which we will provide materials for), and provide liquidity. This will bring our communities much closer.

50% of the incentives will be used to boost the farms of native Optimism protocols. The strategy will be to “showcase” Optimism protocols to our users through our social media (Twitter, Discord, and Telegram) and boost the vault containing its native token. This is great to put those protocols in the spotlight and bring new investors.

Liquidity in Beefy is very sticky. Based on our vast experience doing these kinds of activities, after the boost finishes, more than 70% of the TVL stays in the vault, despite having others with better APY. TVL only moves if the difference is significant. This might be since Beefy is kind of a “set and forget” platform since the only interactions you need to do with our contracts is to deposit and withdraw (No periodic claims, manually compound, etc). We expect to use these incentives in around 12 months, boosting approximately 7 Optimism protocols for 1,5 months each.

15% strategist developer/team incentives. Building a Beefy vault is not a simple task.
Every new vault has its unique challenges that the development team has to solve in order to offer our users the simple “Earn more of what you stake”, but in the back, there is a ton of work being done. We vaulted Stargate pools, bringing more liquidity to their bridge/tokens to the chain. We are also showcasing our brand new Velodrome vaults, making Beefy the first protocol to offer auto-compounding vaults for that protocol. We cannot wait for MakerDAO, Lido, and many other big names to deploy on Optimism so we can work with them to bring liquidity to their pairs. This means we will need to develop even more strategies to fit these protocols.

These incentives will be used to reward new and existing collaborators that develop new strategies for Beefy Optimism. It is relevant to mention that our strategies are open for everyone to see and use, many times being a stepping stone for other protocols to build upon.

All of the incentives will be distributed during long periods of time as described above.

Why will the incentivized users and liquidity remain after incentives dry up?
Incentives are an excellent way to welcome new users to try the chain, and stay for their unique products and ecosystem. We will use the incentives to create deep and meaningful partnerships with Optimism protocols, many of which we had great relations with from other chains. One blockchain CEO compared this kind of incentives to when Uber launched. Uber was giving free rides and discounts to a lot of users, and people stuck using Uber after those incentives run out. Those incentives were used to bring users to a superior ride-sharing service. We are aiming for the same strategy here. Make users come for the opportunities, and make them stay for the unique product ecosystem/community.

Also at the same time that we distribute the incentives, we are planning education around Optimism, their technology, their unique structure of the governance of the chain, and also provide social events in which our multi-chain users can get to know Optimism protocols, and hopefully bring their liquidity/invest on them.

Over what period of time will the tokens be distributed?
Between 12 and 18 months. (Extended the period from last proposal)

Also since Delegates raised the concern of tracking the correct spending of grants, we compromise to keep the delegates up to date with the spending/uses.

How much will your project match in co-incentives?
BIFI has a max supply of 80,000 which is fully distributed, and the DAO holds very little of the supply (less than 1%). That is the reason we can’t match in co-incentives.

To summarize:
Deployed on the chain, locked $3M TVL in 2 weeks.
Re-structure of OP distribution.
Added community-building activities to the proposal leveraging Beefy socials.
Compromise to report the spending to the delegates in the Optimism Discord server.


Would love to hear some opinions. We have worked to launch and grow our TVL into a 10 top OP project within a couple weeks.

great to see updated proposal.

BiFi is live on OP with good volume is just 2 weeks which does support your proposal.

One thing I am still skeptical about is duration, how are you planning to distribute it over move than 1 year, do you have any plan ?

One suggestion, would it be possible to distribute the token as an incentives based on TVL? From 3 to 4, distribute few percent , from 4 to 5 another few percent and so on…

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Hello @OPUser

You raise a valid point, let me elaborate on that. The OP will be used to kickstart our launch. After the OP rewards run out we will consider bribing veVELO holders/BEETS with the some of the earnings of the Optimism vaults to keep the liquidity in that pair. This process requires DAO voting.

About distributing the token based on TVL, can you elaborate a bit more on it? We have very informative graphs in each of our vaults that can be really useful to support your suggestion.

As always thanks for your involvement and feedback.

Nice to see Beefy launched on Optimism already! In just about 2 weeks they moved up to #9 TVL spot! Glad to see the multichain yield optimizer was able to gather so much TVL in a short time.

I would guess the boosts would be staggered across different vaults at different periods of time so it can be used to co-promote with other protocols on optimism? Kind of like a featured or highlighted protocol for the time period to attract new investors?

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I am excited to see that Beefy is applying for grant. I am an extensive Beefy user and I have seen multiple times that boosted vaults bring in a lot of liquidity in a very short time. Since Beefy has over $250 000 000 TVL, we can presume that existing users will move their funds from other chains to Optimism and probably stay there with a portion of that for a long period of time. We have seen this play out before and I think that boosting protocols with high TVL on other chains is one of the most meaningful ways to bring smart capital to Optimism.

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Hello @hoppik ! Thank you for your comment, that is spot on what we are trying to do.

Hi @Armads your suggestion is aligned with our plan. Spread the boosts through time, and give the Optimism protocols in the spotlight so our multi-chain users can get to know them.

Hey thanks for the proposal. For reference the old proposal is here: [READY] [GF: Phase 1 Proposal] Beefy

What are the main differences as a TL;DR?

From a quick look it seems to be:

Allocation got restructured.
Amount is the same.
Deployed on Optimism.
Added co-incentives
Greatly increased the duration of incentives (12 to 18 months).

Is this correct?

Also one thing that would be nice to see in the proposal is a bit more detail on how you plan to distribute those funds over 12 to 18 months.


Hello @lefterisjp Your TLDR is correct, what I would add is that we plan to keep leveraging Beefy’s big community (Twitter with 280k followers, Discord and Telegram) keep bringing TVL to Optimism (Currently we are sitting at $5M), and that the bribes for our liquidity will have to go through our DAO voting.

I will add some detail on how the funds will be distributed so the delegates have a clear vision.

Thanks for your involvement, even on a Saturday :smile:

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OP rewards run out we will consider bribing veVELO holders/BEETS with the some of the earnings of the Optimism vaults to keep the liquidity in that pair. This process requires DAO voting.

Doing so will add value to your proposal but I assume its too early to do a DAO vote now as this will only apply once the incentives are over which will take 12-18 months. But you are considering this so, I would recommend adding this line in the proposal.

About distributing the token based on TVL

Here, as of now you are planning to continue the incentives for next 12-18 month which is a good duration and what I was suggesting is this; you break the incentives into different TVL level, lets say BIFI TVL is 5M now and you start the program with 20% of incentives , once 20% incentives are over you check the locked TVL and release the next 20% incentive only if overall TVL has gone up.

If you release 20% each quarter, you can make sure that total duration of distribution would be more than a year. On top that, you will be safe from burning OP too fast just for liquidity.

Again, not sure about complexity from technical side but thought of sharing this.

I saw from Defilama that current TVL on OP chain is 7M, so consider adding a screenshot or direct link.

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Hey there! I just edited the main post with the DeFillama link to our TVL, and added the mention about the DAO vote to continue the LM incentives. About distributing OP based on TVL, I have compromise to be close with the Optimism community and communicate the impact of our activities through the different ways we have to measure the success (TVL of vaults, token holders, size of deposits, etc) I think that will generate the same effect (see that the OP is being mindfully used, and the impact of the activities) without locking ourselves with some solid structure.

Thanks for your feedback @OPUser !

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hey @frondoto, what you have said make sense.

As this proposal is focusing on LP incentives, I have one more thought on your proposal.

  1. Would you consider changing one of the pair to $OP (35% on incentives), OP/ETH or OP/Stable is up you your team to decide.

  2. You have good liquidity on other chains.

Would it possible to encourage them to move their asset to OP chain. Just be clear, I am talking about migrating the liquidity which means liquidity already locked on your platform. You can use few percentage out of 50% for this.

What do you think ?

Edit 1:- You can put BIFI pair inside 50%

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Copying portions of my post from discord just in case forum folks miss it.

To answer question 1:

  • The 35% was to encourage a bribe (helping the bribe economy of several protocols including Velodrome and BeethovenX) to provide BIFI-ETH liquidity. This pair important for the revenue sharing that we provide as part of the Beefy protocol. If we feel this is overweighted in distribution we can adjust. Though other similar proposals are using a much greater percentage to benefit their own token liquidity, just wondering if we should have consistency in what’s considered ok in this regard.

2: The vast majority of the incentives would be used in efforts to incentivize new users and new liquidity to optimism. We have already shown the organic demand for our product. Since we have 15 chains of users, these incentives will help us not only spur trial of Optimism and hopefully sticky TVL but also benefit the trial of the underlying protocols. Currently we rank 7 in all TVL on Optimism according to DeFiLama. With the grant we will have flexibility to not only incentive use but also build more unique to optimism strategies such as liquid staking velo, univ3 strats, strats built on top of perpetual protocol etc. As for the public good, all our contracts and protocol code is open source. We actually have a revenue share for willing strategists.

Edited the proposal with @OPUser suggestion. The incentivized liquidity will be in the BIFI-OP pair instead of BIFI-ETH


before you go ahead and do this, you mentioned earlier that BIFI-ETH pair was important for the revenue sharing that you provide. Is this still possible with OP? Assuming this had to do w BIFI and not both assets, yes?

Correct, it was about BIFI liquidity more than the specific pair item.

I appreciate that feedback on the prior proposal was taken into account. This looks like a much better proposal to me and I’ll happily support it. Credit to you all for seeing such encouraging early traction after your deployment to Optimism.


Thank you for your feedback @solarcurve . I know you are quite involved in Optimism governance so seeing our proposal align with your vision is encouraging. :smiley:

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This proposal looks sound and the team has been very responsive and helpful in responding to comments and suggestions throughout the process. The distribution looks well distributed across a long duration to help bring and keep liquidity and users on Optimism. Beefy has a long and credible history with many users so they will be able to bring a lot to Optimism. I think they already have over $10M in TVL on Optimism at this point and that shows their dedication

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