[Ready] [GF: Phase 1] Rocket Pool

Hi folks, I’m a Rocket Pool community member and wanted to toss out my 2 cents: We don’t have a budget to match a relevant amount of incentives. Perhaps a symbolic match could be possible if the goal is to see skin in the game?

LDO incentives budget (per a comment in the Lido proposal)

The Lido DAO’s budgets for incentives and rewards programs have been upwards of 4.5M LDO monthly (e.g.: april, june), with overwhelming majority geared towards stETH. Depending on markets and price, this amounts to between $3M and $22M in incentives monthly.

RPL pDAO budget
Budget is ~11k RPL/month = $100k-$500k/month depending on markets. This is not RP’s budget for incentives, this is the total pDAO budget (the protocol dao is responsible for long term continued operations, which is a pretty big umbrella). At current market, matching 1M OP would cost more than 4 months of total pDAO budget, which I don’t think is realistic. Again for emphasis - this is not our incentives budget, nor even our marketing budget - this is our total budget.

I encourage folks to look at Rocket Pool as being a significantly different animal than Lido. We have opted to be extremely decentralized. This incurs real costs, especially requiring node operators to take on all the risk and needing to incentivize that. It also has real benefits for the health of Ethereum in general. I have real fears that liquid staking becomes winner take all and that the winner has far too much power. RP is different in kind at this time: (A) we are starting from an order of magnitude lower market share; (B) the community is likely willing to self-limit in some way - we have talked about such things willingly before; (C) in the worst case, the amount of power that they’d have as winners is much lower due to truly being decentralized - node operators need not even update their smart contracts if they don’t wish to. I think Rocket Pool is very well aligned with the Optimistic Vision - in the end, a more decentralized liquid staking solution is well worth the incremental cost because it increases network security.

Viewed this way, supporting Rocket Pool is partly to popularize liquid yield-bearing ETH to users on Optimism (yay $) AND it is also a public good to most effectively help secure the L1 we all rely on (yay security and decentralization).