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DeFi

SushiSwap’s Bold Proposal For 12.5 Million ARB Bonds Sparks Controversy

September 20, 2023 - Around 3 mins mins to read

Key Points:

  • SushiSwap suggests a bond program in Arbitrum for better liquidity control through DAO governance.
  • The program plans to use dormant ARB tokens, offering quarterly bond sales and discounts for LP token holders.
  • Critics question SushiSwap’s intentions due to its history as a Uniswap fork and past aggressive tactics to attract liquidity.
The leadership team at SushiSwap has unveiled a fresh proposal within the Arbitrum community. Their recommendation centers on the implementation of a bond program, one that SushiSwap will create and oversee. The primary goal is to establish a sustainable model for generating and managing authentic Arbitrum Liquidity under the governance of a DAO.
SushiSwap's Bold Proposal For 12.5 Million ARB Bonds Sparks Controversy
SushiSwap's Bold Proposal For 12.5 Million ARB Bonds Sparks Controversy 2

Under this innovative program, Arbitrum stands to leverage idle ARB tokens stored in its vault, thereby building a more robust protocol-owned liquidity base and converting a portion of vault funds into yield-generating assets.

This bond program will make available up to 12.5 million ARB tokens for bond sales each quarter over a span of four quarters. Users who purchase bonds with ETH-ARB, USDC-ARB, USDT-ARB, and/or wBTC-ARB LP tokens will benefit from slightly discounted ARB token rates.

The plan outlines a meticulous process: an initial 12.5 million ARB tokens will reside in a secure multi-signature wallet, controlled by key stakeholders including ArbitrumDAO and Sushi. A part of the total 10,000 ARB token allocation will be added to the bond treasury smart contract and replenished as necessary. Multiple bonds will be established, each linked to the Treasury contract for facilitating bond sales involving different pairs.

Proceeds from sales will be promptly routed back to the Treasury’s wallet. Periodic status updates will track the program’s performance relative to key performance indicators (KPIs). If KPIs are met, additional ARB tokens will be issued to the multi-signature wallet, initiating a new cycle. Failure to meet KPIs will see unsold tokens returned to the Arbitrum DAO vault, terminating the program.

However, some notable figures voiced skepticism about the proposal. Critics point out SushiSwap‘s history as a Uniswap fork and its past aggressive tactics, raising concerns that this proposal could be a disguised attempt to capture liquidity, reminiscent of its earlier strategies.

The fate of this proposal now rests in the hands of the Arbitrum community, as they evaluate its potential impact on the ecosystem.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

ARB

Arbitrum

DAO

SUSHI

sushiswap

Uniswap

Avatar of Harold

Author

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.
DeFi

SushiSwap’s Bold Proposal For 12.5 Million ARB Bonds Sparks Controversy

Key Points:

  • SushiSwap suggests a bond program in Arbitrum for better liquidity control through DAO governance.
  • The program plans to use dormant ARB tokens, offering quarterly bond sales and discounts for LP token holders.
  • Critics question SushiSwap’s intentions due to its history as a Uniswap fork and past aggressive tactics to attract liquidity.
The leadership team at SushiSwap has unveiled a fresh proposal within the Arbitrum community. Their recommendation centers on the implementation of a bond program, one that SushiSwap will create and oversee. The primary goal is to establish a sustainable model for generating and managing authentic Arbitrum Liquidity under the governance of a DAO.
SushiSwap's Bold Proposal For 12.5 Million ARB Bonds Sparks Controversy
SushiSwap's Bold Proposal For 12.5 Million ARB Bonds Sparks Controversy 4

Under this innovative program, Arbitrum stands to leverage idle ARB tokens stored in its vault, thereby building a more robust protocol-owned liquidity base and converting a portion of vault funds into yield-generating assets.

This bond program will make available up to 12.5 million ARB tokens for bond sales each quarter over a span of four quarters. Users who purchase bonds with ETH-ARB, USDC-ARB, USDT-ARB, and/or wBTC-ARB LP tokens will benefit from slightly discounted ARB token rates.

The plan outlines a meticulous process: an initial 12.5 million ARB tokens will reside in a secure multi-signature wallet, controlled by key stakeholders including ArbitrumDAO and Sushi. A part of the total 10,000 ARB token allocation will be added to the bond treasury smart contract and replenished as necessary. Multiple bonds will be established, each linked to the Treasury contract for facilitating bond sales involving different pairs.

Proceeds from sales will be promptly routed back to the Treasury’s wallet. Periodic status updates will track the program’s performance relative to key performance indicators (KPIs). If KPIs are met, additional ARB tokens will be issued to the multi-signature wallet, initiating a new cycle. Failure to meet KPIs will see unsold tokens returned to the Arbitrum DAO vault, terminating the program.

However, some notable figures voiced skepticism about the proposal. Critics point out SushiSwap‘s history as a Uniswap fork and its past aggressive tactics, raising concerns that this proposal could be a disguised attempt to capture liquidity, reminiscent of its earlier strategies.

The fate of this proposal now rests in the hands of the Arbitrum community, as they evaluate its potential impact on the ecosystem.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.