In light of feedback, this proposal will be modified to incorporate a time lock for the suggested Permanent POL bucket, instead of an indefinite lock forever. In its proposed initial iteration, this time lock will still be achievable via the UNCX locker for Uniswap V3, and as such the locked liquidity would still be highlighted on token trackers such as DEX Tools vis-a-vis the pool information section.
The proposed lock would be for a three year term, which would be automatically renewed by the DAO, though the manner in which it is allocated may vary over time depending on innovations in DEXes, liquidity locker apps such as UNCX, etc.
The proposed Permanent POL bucket itself would thus still be "permanent" in the sense that it would not be able to be apportioned for any other use aside from on-chain liquidity provision on Ethereum mainnet in the future, though the manner in which it is made accessible may change. Similarly, the proposed burn of trading fees accrued in BOTTO and the split of trading fees accrued in ETH between active voters and the treasury would be applicable to the initial three year lock; this breakdown may change in subsequent renewals of the lock depending on how future locks are implemented.
Considering this compromise, it is suggested that 30% of total POL as of the August 2024 DAO financial report be allocated to the Permanent POL bucket upon approval of this proposal (5,164.533 LP tokens), with a subsequent commitment of an additional 20% after one year (3,443.022 LP tokens).
This approach would reduce the operational burden of managing monthly contributions to Permanent POL as originally proposed, while allowing for a more robust baseline of liquidity to be available to stand up the Uniswap V3 pool and thus make it appealing for liquidity providers to consider building on over the next year as the LM program comes to an end in October 2025.
Note that as defined in this proposal, the Permanent POL bucket would not exceed 50% of total POL as of the August 2024 DAO financial report (8,607.555 LP tokens out of 17,215.11 LP tokens). However, after the initial three year lock, the DAO may choose to increase Permanent POL beyond this level, though it would not be able to reduce it. This is because the DAO Directed POL bucket would exceed 50% of total POL by the end of the three year term, as it will continue to grow with ongoing POL contributions from revenue per BIP-59, in addition to any future lump sump increases in POL resulting from OTC deals in accordance with BIP-42.
For the DAO Directed POL bucket, an additional clarification is warranted for inclusion in this proposal. The POL corresponding to this bucket may be repurposed by the DAO for some other use aside from liquidity provision in the future, but a separate governance proposal would be required for this to be executed, and it was suggested that a super-majority be required for such a decision to move forward.
As such, for any proposed repurposing of DAO Directed POL, it is advised that at least 65% of votes in favor be required, with a minimum of at least 5M BOTTO total participating in the vote. A minimum of 5M BOTTO is suggested for participation because any repurposing of the DAO Directed POL bucket would necessarily reduce the availability of on-chain liquidity for Botto's stakeholders collectively. This minimum is not unreasonable, and as an example, over 7M BOTTO participated in the vote for BIP-42, with over 70% of votes in favor of the consequent change in the LM program. The Permanent POL bucket would nevertheless act as a counterbalance to such a change to the DAO Directed POL bucket if it were to ever be pursued.
