[DIP-42] SSV Foundation business development budget

Proposals DIP (DAO Improvement)
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Summary

This proposal aims to establish a business development budget, administered by the SSV Foundation (hereafter: “Foundation”).

Motivation

Ever since the inception of the ssv.network DAO (hereinafter: “DAO”) the DAO has made incremental steps in carefully tailoring its governance on a few specific issues, leaving large areas of interest to the DAO untouched. One such large area is business development (hereinafter: “BD”).

The DAO never had the ability, nor the budget, to perform its own BD. In the past, various industry leaders have reached out to the DAO with a wish to cooperate in different ways. These initiatives do not necessarily fall under an existing framework and were therefore passed on or transferred to be managed by third parties. BD is a cornerstone of any industry, and in the strive of the DAO to become the leading infrastructure in the Ethereum ecosystem, BD efforts run by the DAO, via the Foundation, are indispensable in this goal. The current state of the DAO is such that it has already been chosen by industry leaders who have a great grasp of what SSV and DVT are, and who are very much accustomed to blockchain-only engagement. However, some engagements and new players, such as tradFI, ETFs, ETPs, etc., still require a traditional legal engagement with an entity like the Foundation.

Furthermore, BD activities require more agility and flexibility than those that a DAO, even with its committees, can offer.

In parallel to this proposal, but without dependency, the DAO is reviewing a proposal for a comprehensive Transparency Policy of the SSV Foundation. This Transparency Policy should allow, among other things, complete insight into the subject of this proposal, which are the BD efforts of the SSV Foundation.

Proposal particulars

  1. BD Budget
  2. Funding
  3. Authorization

BD Budget

If this proposal were to pass, an annual recurring budget of 500.000 USD denominated in SSV will be allocated to the Foundation to pursue the goals and activities mentioned above in the Motivation section.

The SSV Foundation may request the budget as needed via a signed message, with the SSV price determined based on the 7-day moving average calculated on the first day of the month in which the request is made.

The budget resets each January 1st. Funds not spent in one year, do not carry over to the next.

For the year 2025, the Foundation will have the full annual budget of 500.000 USD denominated in SSV.

Funding

Due to the current market conditions, this amount will not be minted specifically for this purpose, but rather the proposal suggests reducing the annual budget of the GC to 500.000 USD, denominated in SSV.

Authorization

The Foundation is authorized and encouraged to execute and deliver all such agreements, and do all such other acts and things, subject to DAO resolutions and the said allocated budget, it may deem necessary or appropriate in order to support initiatives aligned with the strategic growth of the SSV Network ecosystem. It should do so by enabling partnerships, collaborations, and integrations that drive long-term value through ecosystem participation and validator adoption.

Notwithstanding the foregoing, the budget will not be used for any initiatives competing with the ssv.network, directly or indirectly.

2 Likes
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On a personal note: I want to highlight that, although it doesn’t directly depend on it, this initiative aligns with the [DIP-43] SSV Foundation Transparency Policy. This policy ensures full observability of the Foundation’s actions, respecting the nature of these actions, and may help alleviate any immediate concerns regarding how the funds are utilized. Personally, I think this is a very elegant governance mechanism and the best of both worlds.

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Thank you Ben to prepare that DIP 42.

I’m not up to date on the GC’s activities but based on the SSV DAO treasury spreadsheet, it seems reasonable financially speaking to reduce the GC budget to fund the new BD budget.

I think this proposal makes sense because it covers exactly the type of opportunity I recently discussed in Discord.

When Kraken became the first major exchange to run all its Ethereum validators on DVT using SSV infrastructure, I suggested we start engaging with Coinbase, Figment, Anchorage Digital and other institutional staking providers for the upcoming potential SEC approval for ETH staking in US spot ETFs.

I think that reaching out early, handling the legal side with TradFi players and syncing with Marketing are presently not something the DAO can move on fast. A BD budget would let the Foundation jump on these chances properly and keep SSV front and center when big opportunities pop up!

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I’ve carefully read DIPs 42 and 43 and was struck by their transparency. BD is important and I’m willing to vote for it.

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Thanks for putting the proposal on paper Ben.

We are in support of essentially carving out a BD budget and empowering the DAO.

Our open questions are

  1. How would the overall BD effort/resources adapt to make use of this focused allocation?
  2. Are there no concerns for longer term budgeting that go beyond a year?

Thank you in advance.

1 Like
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Hey @LemmaGov! Thanks for the questions.

  1. Indeed, multiple forces are doing BD right now. Most of the BD work is handled by SSV Labs (on their own expenses) and will continue to be handled by them. However, as the DAO assumes more responsibility over time, the SSV Foundation, serving as the DAO’s primary vehicle for action in the real world, must take over certain activities. The BD budget presented above is meant for deals where the DAO is the primary beneficiary and where there is less concern about SSV Labs. In that sense, this budget will only be deployed in very specific circumstances.

  2. This proposal states an annual budget of $500k taken from the GC budget that was planned long-term for the next 4 years in [DIP-26] ssv.network DAO Four-Year Budget (2024-2028). The DAO does the best it can to keep well within the limits of this four-year budget and give full control over token emission to the DAO. In order to deploy more funds or allocate them differently, a full DAO proposal is needed. For now, and with almost a year in existence, the DAO has acted well within these limits of the budget and has been able to reduce its spending (and increase the network fee collected drastically), leaving it some leeway for future adjustments.

Let me know if this answers all of your questions or if I have misinterpreted some of it.

Thank you!