Incentivizing Rodeo and the Greater Arbitrum Ecosystem

The Rodeo Finance proposal for the Short Term Incentives Program (STIP) and the GMX DAO Grant were accepted during the backfill voting round and GMX voting round respectively, marking an important milestone for Rodeo and confirmation that we’ve still got the dog in us.

As a result of these grants, Rodeo will have 250,000 and 100,000 ARB directly utilized for supporting the growth of the Rodeo, GMX, and greater Arbitrum ecosystem.

The potentially 350,000 ARB will be utilized to directly incentivize lending liquidity to further facilitate leverage farming as well as boost the leverage farm APR. This serves to simultaneously grow the Rodeo user base, provide users with higher upside for participating, drive greater TVL through our partner protocols, and grow Arbitrum use.

GMX Grant Incentive Utilization

As this grant was received first, Rodeo has completed the KYC process and has received the first distribution. As part of the grant, Rodeo is integrating the GM pools as leverage farms to allow users to deposit up to 10x their collateral into their desired pools.

This also sets the stage for partners to build on top of our leveraged GM farms and Rodeo to utilize GM farms as part of our upcoming isolated structured yield products. Here is how we will utilize the GMX ARB grant:

GMX Grant Breakdown:

Security

• Independent Audit of GM Farms Strategy and Oracle Implementation: We have engaged the #1 code4rena warden (MiloTruck) of 2023 to audit the GM strategy independently. This audit begins the week of Dec 18
• Paladin Sec has audited the GM Farm strategy as part of their full scope audit of Rodeo. The final report is expected before EoY 2023

Lending Pool Incentives

• 20,000 ARB will be used as lending Incentives will be utilized to boost available liquidity for GM farms. The rate will be competitive or better than what is offered in the current landscape for passive USDC returns
• To encourage further participation and sticky liquidity, users will be able to maximize and boost their returns by participating in the on-going Rodeo booster program. This will allow users to earn boosted ARB rewards AND RDO rewards on top of the standard USDC lending interest

GM Leverage Farms

• 30,000 ARB will be distributed to GM farms over 3 months, this will be split proportionally based on TVL to all the deployed GM farms on Rodeo (ETH, ARB, LINK, SOL, wBTC, DOGE?)
• An additional 16,750 ARB will be unlocked when $1m TVL reached in GM farms
• A further 16,750 ARB will be unlocked when $2m TVL reached in GM farms

By received the GMX grant, we aim to facilitate joint growth for Rode, GMX and Arbitrum with users benefitting from the juicy rewards and incentives.

ARB Grant Incentive Utilization

The proposal to backfill the Grant proposals who passed quorum but did not get included as part of the FCFS mechanism passed. As such Rodeo is entitled to 250,000 ARB. We are in the process of completing the required KYC process and look forward to the first distribution.

As part of the grant, Rodeo is working to expand our partnerships and drive volume to our existing valuable partner protocols through our leverage farms. This also helps set the stage for our upcoming Alamo launch and isolated structured yield products. Here is how we will utilize the ARB grant:

ARB Grant Breakdown:

Lending Pool Incentives

• 100,000 ARB for Incentivizing Passive Lending: This portion of the grant incentivizes passive lending to bootstrap liquidity for leverage farmers, enabling them to borrow and earn higher yields, ultimately depositing funds into Arbitrum ecosystem protocols. The rate will be competitive or better than what is offered in the current landscape for passive USDC returns
• To encourage further participation and sticky liquidity, users will be able to maximize and boost their returns by participating in the on-going Rodeo booster program. This will allow users to earn boosted ARB rewards AND RDO rewards on top of the standard USDC lending interest

GM Leverage Farms

• 150,000 ARB for Leverage Farming and Yield Strategies: Rodeo’s leverage farms allow users to borrow up to 10x their collateral and deposit into yield strategies. The collateral and leveraged funds are swapped for the underlying Arbitrum protocol tokens by Rodeo. By incentivizing leverage farming with a greater weight than the passive lending which is already being incentivized by native RDO, users can access higher yields, protocols can achieve greater TVL through increased liquidity, and Rodeo can generate more fees to continue the mutual flywheel.

We would like to take this time to thank all of our partners and delegates who took the time to provide valuable feedback and engage in open discourse on how Rodeo can align with the Arbitrum ecosystem for maximum benefit. The Rodeo team welcomes comments and feedback anytime to further improve our positioning in the ecosystem.

The grant’s primary goal is to attract liquidity to high quality projects across the Arbitrum Ecosystem. Boosting these incentives will drive more capital to Arbitrum, and result in deeper liquidity for projects trying to build, and fees created for Rodeo. Users receive better capital efficiency, while protocols receive deeper liquidity, driving a more efficient capital market on Arbitrum.

The core value of Rodeo Finance lies in its ability to seamlessly blend leverage yield farming and passive lending, while maintaining a high level of composability. This combination allows users to optimize their real yields, while driving liquidity (and thus fees) to our partner protocols.

By presenting this experience in a simple manner, Rodeo is able to onboard new users from a single UI/UX to participate across multiple Arbitrum protocols.

We invite you to follow us on Twitter and in Discord to get notified when the juicy ARB rewards kick in. Yee-hawww