Introducing Spiral DAO
Spiral DAO is built to be the most capital-efficient DAO while being intuitive for newcomers and complementary to the whole ecosystem. Our novel DAO model strives to accumulate a significant share in CRV, BAL, FXS, as well as other DeFi blue chips in order to optimize our market position and open a new chapter in yield farming. A chapter without cannibalistic selling of the yield and inflationary pressure. We believe that Spiral DAO will be an important foundation stone in the future DeFi 2.0.
All of this is achieved by a sophisticated architecture that includes a novel yield farming model, a two-token structure, and a clever utilization of existing market inefficiencies.
The DAO
Yield Bonding
Spiral DAO works similarly to a yield aggregator. However, a key difference is that instead of immediately selling and compounding the rewards, it collects all rewards into the Treasury and distributes its native token, SPR, with an additional yield on top.
Two-token structure + POL
The native DAO token Coil (COIL) is the main target of Protocol Owned Liquidity (POL), is distributed during auctions, and can be staked alone for high APY. A staked version of COIL is a Spiral (SPR) token. SPR is the main reward token for staking in liquidity pools, has all the voting power and each SPR token is designed to be backed by more tokens as time passes (the SPR backing ratio should grow exponentially). So, instead of receiving highly inflationary reward tokens often associated with yield farming, with Spiral DAO, the user gets a portion of the DAO protected from high inflationary pressure.
Treasury and bribe market
The DAO Treasury utilizes bribe markets and liquid lockers to reach a necessary level of each token exposure and beat the inflation of each token. Because of a clever rebalancing mechanism that operates depending on the current market conditions, SPR tokens should represent an always-growing market share of all supported ecosystems. Simply as the byproduct of how Spiral DAO operates, it makes the bribe market more rational and efficient for all participants and protocols that engage in bribing mechanics. We expect that Spiral DAO will soon become a major bribe buyer/seller for most ecosystems due to its native bribe arbitrage opportunities. As a result, Spiral DAO will significantly increase bribes yields for all protocols it engages with (we are talking possibly 30–80% more).
According to our estimation, bribes markets are inefficient, resulting in at least $30mln worth of inefficiency annually. SpiralDAO is here to capture it.
Expansion auctions
Another core way for Spiral DAO to accumulate new funds into the Treasury and onboard new users is by conducting fair periodical oversubscription auctions of COIL tokens with a small discount (basically PancakeSwap IFO model). This way, we can painlessly increase Treasury backing and create a new price floor for the whole ecosystem.
Partnerships
An important way for Spiral DAO to get additional value for its holders. We’ve managed to secure synergistic deals with several important players and look forward to sharing them with the public.
Guarantee of Exit
An important part of the mentioned model is the ability for everyone to redeem their tokens if the market cap of COIL becomes lower than the Treasury backing. For these cases, Treasury will deploy an infinite buy wall at the level of 90% of the Treasury value. This way, everyone is guaranteed a fair exit, while each of these exits leads to better backing for those who stay.
All the mentioned mechanisms are built with the intention of making Spiral as robust and solid as possible.
This model makes Spiral DAO beneficial for:
Farmers. As they receive a higher yield than anywhere else. E.g., the Convex pool has 40% APR in CRV / CVX, and Spiral DAO gives 60% APR in SPR, if the COIL market cap is at 220% of Treasury value.
Other protocols. Yield rewards are preserved and collected instead of being sold, reducing the circulating supply and sell pressure of the tokens it accumulates.
Token holders. Spiral DAO allows users to participate in the governance process of numerous protocols by holding only one token — SPR, a token with a backing ratio designed to grow over time.
Launch details
At its launch, Spiral DAO supports Convex and Aura native pools for staking. We plan to expand to FraxSwap in the following months and to many more projects and networks in the future.
Initial Auction
We plan to bootstrap our Treasury through the initial oversubscription Auction. We will be raising USDC/CRV/BAL/FXS/SDT. The Auction will be announced and take place on the 30th of March. We will aim for the following initial treasury composition:
Launching Airdrop and Community incentivization
To encourage adoption, Spiral DAO will hold a two-phase Airdrop:
- Phase 1 will be conducted right after the Initial Auction. During this time, Spiral DAO will airdrop 3% of the initial token supply towards existing Balancer, CRV, and FXS stakeholders as well as DegenScore Beacon and Lobster DAO NFT holders and top DeBank users.
- Phase 2 will be distributed between the most active community participators. Contribute, participate in crew3 and the governance forum incentivization program as well as Discord activities. Phase 2 Airdrop will be distributed in the following months, so you’ll have plenty of time to join.
Security
DAO smart contracts have been audited by Pessimistic.
To encourage and reward valuable security contributions, we have implemented an ongoing Bug bounty program.
Spiral DAO will have two multi-sigs: a treasury multi-sig (3/6 quorum) and a protocol multi-sig (4/6). The participants of the multi-sig, apart from team members, will include other respected members of the community — DeFi protocols founders, investors, and influencers.
Each mechanism is covered in an independent article as well as our official docs.
More alpha to come. Stay tuned 🌀.
Socials
This article and any information contained herein are subject to Legal Notice.
