Research Summary
The report discusses several key governance actions in the crypto space, including Arca’s Blur fee switch proposal, ApeCoin’s reallocation of ecosystem funds into Ethereum and USDC, ApeCoin’s development of its own Zero-Knowledge Powered L2 using the Polygon CDK, and the sunsetting of Lido on Polygon. The report also provides an analysis of the likelihood of these proposals passing and their potential implications.
Key Takeaways
Arca’s Blur Fee Switch Proposal
- Proposal Overview: Arca has proposed a 1% platform fee, which will be used to buyback and burn BLUR. The proposal also includes tiered fee discounts depending on the amount of BLUR held in users’ wallets.
- Financial Implications: With Blur’s current daily volume of ~$7m, this could result in roughly $20m worth of buybacks yearly, implying a roughly 8% APY on the token or 13x P/E ratio.
- Passing Likelihood: The likelihood of this proposal passing is medium to high, with debate split between those in favor of the switch and those concerned about the impact on volume.
ApeCoin’s Reallocation of Ecosystem Funds
- Proposal Overview: A proposal has been made to reallocate 10% of the ApeCoin DAO ecosystem fund into USDC and ETH, with the aim of ensuring the DAO’s long-term financial health.
- Financial Implications: If passed, this could result in roughly 15m APE ($20m) of sell pressure.
- Passing Likelihood: The likelihood of this proposal passing is medium, with forum debate largely against the proposal due to concerns about the impact on the treasury book value.
ApeCoin’s Development of Zero-Knowledge Powered L2
- Proposal Overview: A proposal has been made for ApeCoin DAO to develop and maintain its own zero-knowledge powered Layer-2 with the Polygon Chain Development Kit (CDK).
- Financial Implications: If passed, this would be net positive for Polygon.
- Passing Likelihood: The likelihood of this proposal passing is low, with forum sentiment against the proposal due to concerns about the need for a new chain and security issues.
Sunsetting of Lido on Polygon
- Proposal Overview: A proposal has been made to sunset Lido on Polygon due to high costs and brand risk.
- Financial Implications: If Lido sunsets Polygon, competitors including Ankr and Stadar Labs could benefit.
- Passing Likelihood: The likelihood of this proposal passing is low to medium, with forum stance largely against the proposal due to concerns about the impact on partnerships and the lack of additional funding ask from ShardLabs.
Actionable Insights
- Monitor Blur’s Fee Switch Proposal: Keep an eye on the outcome of Blur’s fee switch proposal, as it could have significant implications for the value of the BLUR token.
- Assess Impact of ApeCoin’s Reallocation: If ApeCoin’s reallocation proposal passes, it could result in sell pressure on the APE token. Monitor the situation to understand the potential impact on the token’s value.
- Consider Implications of ApeCoin’s L2 Development: If ApeCoin’s proposal to develop its own Layer-2 passes, it could be a positive development for Polygon. Consider the potential implications for Polygon’s value and position in the market.
- Watch Lido’s Sunsetting Proposal: The outcome of Lido’s sunsetting proposal could have implications for competitors such as Ankr and Stadar Labs. Monitor the situation to understand potential market shifts.
