KPI Options | A retro and the next steps

Tl:dr: Outcome.Finance has adopted UMA’s KPI options and is making the incentive tool more composable and permissionless. We accomplish this through simplifying and narrowing their scope to support project TVL that is tracked on DefiLlama, and any metrics available through querying a subgraph via The Graph. This narrower focus will allow projects and DAOs to plug-and-play Outcome’s KPI options in a matter of minutes, which was not possible before.

KPI options origins

UMA’s original KPI options emerged as a synthetic product in early 2021. They were launched so DAOs could create and distribute assets that would only pay out if certain project goals were hit.

The earliest iterations of KPI options were in-house programs by UMA focused on expanding UMA’s TVL. The program design included an airdrop of these uTVL tokens to a large pool of addresses.

From there, 20+ other DAOs experimented with KPI options over the next year. These included an incentive program by the Boba Network to encourage L2 adoption by incentivizing dapp developers and early power users with “WAGMI options”, which would pay out different amounts of Boba tokens depending on how much Boba’s TVL increased; and another KPI options program with BadgerDAO, called Rebase Mining, which aimed to encourage positive rebases of BadgerDAO’s DIGG token.

These implementations were successful experiments, but over time it became clear that the limitless flexibility of KPI options was actually acting as a barrier for adoption.

Two prominent issues arose: the cost of educating communities about their design, and the cost of implementation. There were other integration ideas with KPI options that were promising concepts, but many never got off the ground due to coordination complexities and creative inertia.

Outcome welcomes KPI options to the family

So it was time for KPI options to evolve, mature and become more focused.

Outcome.Finance, UMA’s sister project, has adopted KPI options and is making them more composable and permissionless with a simpler, narrower scope.

This new iteration of KPI options is focused on creating simple and understandable products. This is done by pre-approving set standards of acceptable data sources and request methodologies that can be used with UMA’s optimistic oracle to price KPIs. Initial support includes protocol TVL metrics that are tracked on DefiLlama, or any metric available through querying a subgraph via The Graph. This narrower focus allows projects and DAOs to plug-and-play Outcome’s KPI options in a matter of minutes instead of weeks.

For the full explanation, see the docs.

Dive deeper into the new Outcome KPI options

The main shift with these new KPI options is a narrower list of what can be used as a metric. We selected DefiLlama and the Graph’s subgraphs because they are open source and widely trusted and used within the DeFi community.

These are the initial supported data sources, but will evolve over time.

So what does “supporting these data sources” really mean? It means that any TVL metric you see on DefiLlama, or a metric referenced through a subgraph, can be used to launch many different synthetic tokens within minutes.

All of these can be created using TVL options with different payout functions:

• Vesting airdrops where the airdrop value is determined based on your protocol’s TVL increase over the year
• Inverse TVL options that can be sold as insurance
• Contributor payments based on the conditional performance of the protocol

This is how you can get started

To learn the specific process to program and launch your KPI option campaign, review this deployment tutorial.

Generally, you would want to think about who you want to incentivize and how to incentivize them — and within what time frame.

Outcome is also open to doing AMAs with the teams that want us to discuss KPI options with the broader community.

About Outcome.Finance

Outcome.Finance is the new home for KPI options.

Outcome uses UMA’s optimistic oracle to secure a suite of DAO tools to help DAOs achieve better outcomes, including KPI options, success tokens and the optimistic governor.

About UMA’s optimistic oracle

UMA is an optimistic oracle (OO) that can record any knowable truth onto a blockchain. It tells smart contracts “things about the world” so contracts and markets asking for that data can be settled. The OO has been called “a human-powered truth machine” because it is flexible enough to handle ambiguity and expands the design space possible in web3.

The OO secures a diverse ecosystem of web3 applications, including cross-chain bridges, insurance protocols, prediction markets, and customizable DAO tooling products.

Learn more about KPI options here and get in touch with our team via Discord and Twitter.