Deploy BAL & aBAL from the Collector Contract

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Aave's BAL token holdings management was discussed, with two strategies proposed by Llamaxyz: locking veBAL for participation in Balancer gauge and governance votes, and staking auraBAL for yield prioritization. A community vote will decide the strategy, and the proposal is open for feedback before a Snapshot in the coming weeks.

The discussion revolved around the management of Aave's BAL token holdings, which were acquired to support Aave lending market adoption. Two strategies were proposed by Llamaxyz. The first strategy involves locking veBAL, allowing Aave to participate in Balancer gauge and governance votes, and benefit from LP boosting and protocol fees. The second strategy involves staking auraBAL, prioritizing yield over governance influence. A community vote will be held to decide between these options.

The BAL tokens were acquired through various means, including a token swap with Balancer DAO, an on-market acquisition swap contract, and user borrowing on Aave. The first option would involve converting all BAL with sufficient WETH to B-80BAL-20WETH, which would then be deposited into the VotingEscrow veBAL contract and locked for a year. This would earn a boost of up to 2.5x on the liquidity provided on Balancer and 75% of all trading fees consolidated for bb-a-USD (stable) + BAL from the veBAL gauge would be distributed to lockers. The second option would involve depositing the B-80BAL-20WETH position into Aura Finance’s auraBAL wrapper contract to earn staking yield in several forms. The yield received from the auraBAL holding can be compounded to earn additional yield.

Llamaxyz is now proceeding to scope out and start working on the bonding curve for this deployment. The 100K BAL purchase payload has been through peer review once and will be resubmitted for a second review shortly, before being submitted for on-chain voting. MarcZeller expressed support for the proposal, stating that veBal is critical from a strategic standpoint for both the safety module and GHO. He also mentioned that Balancer and Aave DAO have worked together since day one, and this proposal reinforces the synergies with the balancer ecosystem.

The proposal has been revised and they welcome any community feedback before progressing to a Snapshot in the coming weeks. The community will have the choice of: YAE - Option 1) Locking veBAL, YAE - Option 2) Staking auraBAL, NAE, or ABSTAIN. The introduction of the CoW Swap protocol was also discussed, highlighting its benefits for large DAO trades and its implementation using the Milkman tool developed by Yearn. The protocol allows for onchain enforceable dynamic slippage protection and the matching of orders against other orders or any available external liquidity.

Posted a year ago

Last reply 7 months ago

Summary updated 2 months ago

Last updated 08/12 04:39