This version is an updated version of the proposal, introducing ranked-choice voting and adjusting the way in which ETH rewards are distributed.
Summary
This proposal outlines how we integrate Botto into the Base ecosystem. TL;DR, the following is proposed:
- Deploy a parallel $BOTTO ERC-20 Token Contract on Base via Supermigrate
- Deploy a $BOTTO Governance Contract on Base
- Deploy an ETH Rewards Contract on Base
- Audit Base Governance & ETH Rewards Contracts
- Make ETH Rewards Claimable on Base
- Ranked-choice snapshot voting on Liquidity migration
- Migrate up to 20% of PoL to Base to support liquidity
- Migrate 15 $ETH from treasury + $BOTTO (BIP-42) to Base to support liquidity, with the option to pursue the migration of up to 10% of mainnet POL in the future
- Update Snapshot Strategy to accommodate $BOTTO stakers on Base
Rationale
Base’s reach to retail consumers, its growing adoption within the onchain art community, and its integration with Optimism's "superchain" makes it impossible for us to ignore. Embedding ourselves in Base’s ecosystem increases our total addressable participants while significantly lowering transaction costs compared to Ethereum alone. This allows us to engage a longer tail of participants in new ways. Base’s close connection to the broader Ethereum ecosystem via Optimism allows us to retain strong links to mainnet while leveraging the advantages a Layer 2 brings.
The first step in accessing the Base ecosystem is bridging the token to Base. Integrating Base offers several strategic advantages specific to Botto:
New Audience Exposure: Deploying $BOTTO on Base opens up the arena for the DAO’s growth marketing potential, tapping into a growing, ETH-native user base on one of the leading Layer 2s. This is crucial for increasing visibility and adoption among crypto participants. We’re already reducing barriers to entry (such as BIP-60 on minimum staking requirements), and this move expands opportunities for engaging with that audience.
Efficient Rewards Distribution: Base's lower transaction fees allow for more frequent and economical reward claims, eliminating high-cost barriers on Mainnet. This aligns with reducing minimum claim amounts (BIP-60) and opens up potential for other forms of rewards (e.g., reputational ones like badges).
Enhanced Collaboration: Aligning with Base positions Botto to benefit from strategic partnerships, shared resources, and potential co-marketing opportunities within both the Base ecosystem and the broader superchain ecosystem.
In short, we see Base as an opportunity to open up the design space for Botto participation, and this proposal is a first step toward embedding $BOTTO into Base’s ecosystem. After completing this proposal’s timeline, the DAO should run ongoing marketing campaigns on Base to increase onboarding and enhance participant retention. This could be through protocols like Boost or Galxe, or natively through Botto’s platform. This proposal does not cover steps beyond bridging the token.
Proposal Specifications
1. Contract Launches
$BOTTO Token Deployment:
- Use of Supermigrate: We would use Supermigrate, which leverages the OptimismMintableERC20Factory.sol contract provided by Optimism, to deploy the $BOTTO token on Base. This ensures a smooth bridging process and compatibility with the existing token contract.
- Superbridge Whitelist: Enable two-way bridging of $BOTTO via Superbridge, allowing seamless transfers between Mainnet and Base, enhancing liquidity and user flexibility.
Governance Contract:
- Staking on Base: Deploy a governance contract on Base that mirrors Mainnet functionality, allowing users to stake their $BOTTO tokens on Base and participate in governance activities without switching back to Mainnet.
Rewards Contracts:
- $ETH Rewards: Deploy a rewards contract allowing DAO members to claim $ETH rewards on Base. The low transaction fees on Base will enable more frequent and smaller reward claims. The $BOTTO rewards contract, which shares a similar codebase, can be easily adapted in the future for additional reward types.
2. Liquidity Migration Options
2.1 (Option 1) Protocol-Owned Liquidity Migration
- Current Liquidity on Mainnet: The DAO currently holds $1.1M USD worth of liquidity as a Uniswap V2 pair on Mainnet (09/05/24). It is proposed to migrate an initial 10% of this PoL to seed liquidity pools on Uniswap on Base.
- Future Liquidity on Base: The treasury working group can pursue migrating up to an additional 10% of mainnet POL to accommodate future liquidity needs and/or seed an Aerodrome pool on Base.
2.2 (Option 2) Treasury ETH Liquidity Migration
- Liquidity on Base: Alternatively, bridge 15 $ETH from the treasury + BOTTO (per BIP-42) to initially seed the Uniswap pool on Base, coupled with the option to pursue the migration of up to 10% of mainnet POL in the future.
3. User Interface Integration
- Staking: Enable $BOTTO held on Base to be staked via the v2 app’s user interface.
- Rewards: Enable $ETH rewards to be claimed on Base through the v2 app’s user interface.
4. Governance Mirroring
- Snapshot Strategy: Ensure that governance stakers on Base are included in an updated Snapshot Voting Strategy.
5. ETH Rewards
- Transferring & Rebalancing: Seed the ETH Rewards contract on Base with an initial 1ETH. Should ETH Rewards claims on Base exceed the total ETH in the Base Rewards contract, the Treasury Working Group reserves the right to rebalance transfers of future ETH Rewards between Mainnet and Base, subject to DAO reward-claims demand.
6. POL Flexibility
- LP Incentives Strategy: Allow the treasury working group to optimize for the best use of the POL on Base, specifically as it relates to LP opportunities on Aerodrome. Amendments to liquidity would only happen after open, transparent discussion with the DAO.
Timeline
Phase 1: Setup (Mid-September)
- Adjust codebases for the Governance and ETH Rewards contracts.
- Contract audits.
Phase 2: Deployment & PoL (Mid-September)
- Deploy token on Base.
- Whitelist token on Superbridge.
- Deploy Governance Contract.
- Deploy ETH Rewards Contract.
- Bridge (choose either):
- 10% of PoL (ETH + BOTTO) to Base (Option 1).
- 15 $ETH from treasury + $BOTTO (BIP-42) to Base (Option 2).
Phase 3: User Interface Integration & Monitoring (Mid-End September)
- Integrate contract interactions and reward claim events through Botto’s v2 UI.
- Monitor and adjust liquidity pools based on user activity and trading volumes.
- Update Snapshot strategy to accommodate stakers on Base.
Budget
Excluding PoL, there are two line items for rolling out $BOTTO on Base:
- Contract Development and Deployment: $3000
- Contract Audits: $3500
Total Budget: $6500
Criteria of Success
Migrating to Base alone may not lead to significant userbase growth and trading volume, but we’ll monitor the following KPIs:
- Weekly Active Users (WAU): Track unique users interacting with Botto on Base weekly.
- Transaction Volume: Monitor the total number of transactions across all deployed contracts on Base.
- Liquidity Metrics: Measure liquidity depth and trading volumes in $BOTTO pools on Uniswap and Aerodrome.
- Reward Claims: Track the frequency and volume of reward claims by DAO members on Base.
Risks
Liquidity Fragmentation: Splitting liquidity between Mainnet and Base may dilute overall liquidity, impacting trading efficiency and price stability. Mitigation involves a gradual migration strategy and continuous monitoring.
Technical Challenges: Potential technical issues with contract deployments or integrations. Mitigation involves thorough testing and collaboration with experienced partners like Supermigrate.
FAQs
How can I vote on my preferred liquidity provision method?
The snapshot will provide ranked-choice voting, including 2 options for voting in favor of the BIP, with either option supporting different liquidity provision methods.
Will the contract address on Base remain the same?
No, the contract address for $BOTTO will differ. Botto’s Deployer will be the contract creator. We will provide updates to Coinmarketcap, Coingecko, and other larger token tracking services.
Will I have to be staked on Base and Mainnet to be eligible for active rewards?
No, the platform will detect stakes irrespective of whether you use Mainnet or Base. Base users won’t need to be on Mainnet, and Mainnet users won’t need Base for existing functionality. Future $BOTTO rewards would be possible on both Mainnet and Base.
How will we transfer active rewards to two $ETH Rewards contracts?
The Base rewards contract will be seeded with 1 $ETH to accommodate immediate claims from users. The Mainnet $ETH rewards contract has a significant buffer. If $ETH claims on Base begin exceeding the total value in the Base ETH Rewards contract, the treasury working group will rebalance ETH rewards distribution according to demand.
