SSV x Lido [Simple DVT Expansion]

Proposals Grants
1

Proposal summary

This proposal aims to increase the pace of adoption of validators within the Lido Simple DVT Module, following an initially approved grant by the ssv.network DAO’s Grants Committee, and make use of the vault solution for Lido Simple DVT module participants.

Motivation

Recently the Lido DAO passed two separate votes to:

  1. Increase the capacity of the Simple DVT module to a 4% share limit (2% of which will be allocated to validators utilizing SSV’s DVT implementation) and

  2. For the implementation of a vault solution that will be used as a focal point for user staking and DVT incentives to quicken the pace of new validators being added to the Simple DVT Module.

To date, the Simple DVT Module has seen great progress and success, and is now entering its next stage with a substantial capacity increase.

Proposal particulars

In reference to the votes related to the Simple DVT module linked above, this is a request for the ssv.network DAO to approve the following:

  1. Increasing the SSV token allocation to cover the first year of SSV Network fees for the normal Simple DVT clusters and Super Clusters (assumed 36 clusters running 80 validators and 5 clusters running 500 validators) and

  2. Allocating SSV Incentived Mainnet rewards in a format of the SSV Network DAO’s choosing in a configuration that will allow for 90% of incentives to be directed to the “Distributed Validators Vault” and 10% to the Node Operator participants utilizing SSV Network DVT within the Simple DVT Module.

This grant would simplify the onboarding process of nearly one-hundred fifty participants expected to utilize SSV Network based DVT via the Lido Simple DVT Module and quicken the pace of SSV Network adoption within the Lido Node Operator set.

4 Likes
2

This proposal seems to be a win for both SSV Network and the Lido community. Increasing validator adoption and implementing the vault solution will speed things up and make the process smoother.

The plan to use SSV tokens for network fees and incentives is smart. It’s great to see how this will boost our DVT implementation and streamline rewards for participants.

As long as the tokenomics stay favorable for SSV, this proposal is definitely worth supporting. It will drive adoption, strengthen our network, and benefit everyone involved.

4 Likes
3

Regarding the mention of “Increasing the SSV token allocation to cover the first year of SSV Network fees for the normal Simple DVT clusters and Super Clusters,” I would like to ask where the SSV comes from.

Regarding the mention of “Allocating SSV Incentived Mainnet rewards in a format of the SSV Network DAO’s choosing in a configuration that will allow for 90% of incentives to be directed to the ‘Distributed Validators Vault’ and 10% to the Node Operator participants utilizing SSV Network DVT within the Simple DVT Module,” may I ask if this SSV still comes from the previously proposed decision of 1M SSV?

4 Likes
4

Dear Lido Team,

The SSV Grants Committee has reviewed your request regarding the Simple DVT Expansion under point 1 of the proposal particulars.

We are pleased to inform you that we will present Lido with a grant and a maximum budget of 4830 SSV Tokens to secure the runway of the assumed 36 clusters running 80 validators and 5 clusters running 500 validators with reasonable deviation allowed. The budget is allocated from the existing grants budget and in accordance with the new grants strategy, and it shall guarantee a runway of 12 months once the program has started and the first funding has been made.

This grant will be issued under the terms and mechanics of the first grant, and SSV DAO member @EridianAlpha will continue to administer the program. Due to the similarity of both grants, there might be an overlap in budget allocations. Both budgets shall be seen as one and support the activities according to this proposal.

Due to the on-ramp phase, program changes, network dynamics, and network parameters, it is impossible to estimate the exact demand for funding over one year. Therefore, the grants committee ran several simulations, including a buffer, to estimate the demand.

Average Network Fee based on expected case simulations: 0.72 SSV/year

* 36 clusters * 80 validators * 0.72 SSV = 2,244.03 SSV 
* 5  clusters * 500 validators * 0.72 SSV = 1,947.95 SSV 
* +15% buffer
**Total SSV/Year = ~4830 SSV**

Please note that this is the maximum amount to be spent. If the actual demand is lower (expected case), the remaining SSV will be returned to the DAO’s Grant Budget. Neither Lido nor SSV have control over the Lido Simple DVT SSV cluster multisigs, so there is a possibility that the SSV in a cluster is lost, unrecoverable, or misappropriated. To minimize the risk of these undesirable situations occurring, the SSV balance of each cluster should be maintained at a minimal required balance given these possible outcomes. The Lido and SSV administrators are authorized to define the mechanics that best suit the Lido Simple DVT program.

As for point 2 of the proposal particulars, the current incentivized mainnet program needs to define an exception to support Lido’s Distributed Validators Vault. For this, a DAO vote is required. The proposal draft process has started and is expected to hit the forum next week.

We look forward to a successful collaboration.

Best regards,
SSV Grants Committee

4 Likes
5

Hello @Yuting @AXBLOX, thank you for your questions. As per the message above, the funds will come from the existing grants program budget and will not impact the total supply of SSV tokens. Thank you.

2 Likes
6

Thank you very much for your reply and for clarifying the source of the funds; this is very important.

3 Likes