Strike Grants Program
Strike Finance Community proposes to start a program called the Strike Grants Program (“SGP”), which will provide funding to projects, ideas, and events that benefit Strike and its stakeholders. If approved, funding for the program will come from Strike Distribution, which currently holds ~$177mm as of 09/30/21.
The program will be a pilot. For this reason, we believe it’s prudent to limit the program’s dollar value to $1mm per quarter and the length to two quarters for a cost of $2mm over six months.
Since it’s not practical to solicit a community vote for every disbursement, we propose forming a small and nimble committee that has the power to administer the grants at its own discretion (limited by the aforementioned dollar and length caps). We suggest forming a committee of five members: one lead member to head the program and four reviewing members to review the lead’s work and assist with program operations. The committee will operate with a 3 of 5 multi-sig (only reviewers will be part of the multi-sig).
As compensation for administering the program, we propose the lead be paid $5k upfront and $100 per hour thereafter with a cap of 30 hours per week for a maximum compensation of $83k. In total, we are asking for a maximum of 2,000,000 USDT to fund the grants, program setup and operational costs (200k USDT), and compensation for the program lead (100k USDT). All unspent funds will be returned to the community treasury at the conclusion of the SGP.
Purpose
Decentralized projects are living and breathing communities with a variety of stakeholders. These stakeholders include project team/contributors, token holders, users, partners, and for certain projects, liquidity providers. The goal for the SGP is to nurture Strike’s ecosystem to benefit all of these stakeholders. To be more specific, the grants program aims to:
- Grow Strike’s ecosystem by funding development happening on top of it. Funding development focused on helping Strike grow is critical to the project’s long-term success.
- Fund ideas that benefit Strike that would otherwise not receive funding. Many good ideas are left unexplored because they fail to receive funding. We intend to make sure as few good ideas as possible are underfunded or unfunded.
- Strengthen goodwill by providing funding for community-led ideas. Funding projects, ideas, and events brought forth by community members will encourage more active participation by the community. It will have the added benefit of nourishing goodwill. A well-nourished goodwill keeps community members loyal and happy, which in turn, encourages new members to join what they see is a thriving community.
Program Scope
The SGP was heavily inspired by the Uniswap Grants Program (“UGP”), which received approval from the community to deploy a maximum of $750k per quarter for two quarters. It’s difficult to deploy a meaningful amount of money to ecosystem grants without compromising on quality. While we believe all of these ecosystems will be enormous in the future, it’s important for us to be practical today by matching the grants budget to the size of the ecosystem.
To that end, the pilot program will deploy a maximum of $1mm per quarter and run for two quarters. We have no way of knowing whether this amount of money is overshooting or undershooting the needs of the ecosystem — we will only find out after running the experiment. For example, if we find out $2mm is not enough money to fund all of the high quality opportunities, we as a community may decide we need to create a larger allocation for grants. On the flipside, if we find out $2mm is too much, all unspent funds will be returned to the community treasury for use at a later time.
As part of the program, our intention is to fund projects, ideas, and events that directly benefit Strike and its stakeholders. While there may be opportunities to fund projects, ideas, and events that indirectly benefit Strike, these opportunities fall outside the scope of this program.
Not all opportunities applying for grants will benefit the Strike ecosystem equally. To help us prioritize which ideas to fund, we propose the following buckets:
High priority
- Protocol and parameter development. Apart from acts of stewardship and generosity, there is little to no incentive for community members to propose technical updates to the protocol. With no carrot with which to motivate community members to propose changes, the protocol isn’t able to innovate as quickly as it should be innovating in a dynamic and competitive market. We should note that in a minority of cases community members did receive payment for work done (for example, see the work done by Strike in on the Strike Governance Launch proposal), although here too, the incentive to contribute was not well-designed since it required Certik or Peckshield to front audit and development costs before knowing the proposal to pay them would pass. To encourage community members to propose changes, the SGP will fully or partially pre-fund development and audit costs. In doing so, we hope to encourage more proposals, which will lead to more innovation and as a result, a far better Strike for all of us.
- Code audits. Making technical updates to the protocol is risky business: smart contracts are immutable and control billions of dollars in user funds. An error in a technical update can have serious consequences. Because of this, it is considered best practice to have an auditor review the proposed update for soundness prior to its submission. Unfortunately, these audits are expensive , particularly for individual contributors who need to pay for them out of pocket. We intend to provide grants that pre-fund audit costs for soon-to-be proposals. We hope this will encourage more individual contributors to propose technical updates to the protocol.
- Business development / integrations. A greater amount of liquidity makes Strike a better product for all users. To grow liquidity, Strike should be integrated with as many applications as possible. To that end, we aim to fund integrations that grow usage of Strike. In funding integrations, we will effectively be funding the business development function for the protocol.
- Advertising and sponsorships. It will be important to get the word out there about this program. The more people there are that know about the SGP, the more applications we should expect to receive. To spread the word about the program, we will spend funds to advertise the SGP on podcasts, newsletters, and other mediums that attract the audience we want to attract.
Medium priority
- Hackathons. It’s very likely that there exist uses for Strike that haven’t been explored yet. Hackathons are a fantastic way to explore design spaces, and the SGP intends to sponsor them.
- Bounties. This one speaks for itself: bug fixes and minor protocol updates will be covered by the SGP.
Low priority
- Miscellaneous improvements. It’s difficult to know ahead of time all of the grant applications that will come through. Just because an application does not fit neatly into one of the above buckets doesn’t mean it’s not valuable to the Strike ecosystem. So long as an application benefits Strike directly, we will consider it for a grant.
- Applications for miscellaneous improvements to Strike fall into this bucket. Because the scope of this bucket is broad, we consider it to be low priority compared to the narrowly scoped buckets above.
While we did our best to prioritize items among each of the three buckets, we are confident that the above list is not all-inclusive. We expect to receive grant applications for phenomenal ideas that we simply can’t think of today. The committee asks the community for the right to exercise discretion to fund ideas that are beneficial to Strike but are not part of the scope outlined above.
Process and Timeline
If approved, the program will begin shortly after this proposal passes and end six months following the start of the program. (In other words, if the proposal passes on 10/05/2021 and begins on 10/12/2021, it will end on 04/12/2022). The program will run on a rolling process: we will welcome applications at any point in time during the program length! We will stop accepting applications two weeks before the end of the program (during these two weeks, we will start wrapping the program up, which will include evaluating the last of the applications and returning unspent funds to the treasury).
We will source potential grants via an application process. (We will be sharing the application soon after this proposal passes).
Once an application is received, SGP committee members will discuss the application and evaluate it in the context of its benefit to Strike and its stakeholders. If the committee approves the application, funds will be paid out to the receiving party on a timely basis. If the committee does not approve the application, the soliciting party will be notified as to why the application was not approved and, if applicable, what steps need to be taken to have the application approved in the future. All approved grants and their amounts will be disclosed to the community publicly and on a timely basis.
What Does Success Look Like?
We expect success to come in two forms: one that’s measurable and the other that’s of the “you know it when you see it” type.
Measurable success metrics:
- Number of projects, ideas, and events funded
- Community engagement (e.g., increased activity on forums, Telegram, Twitter, and so forth)
- Increase in number of applications
“Know it when you see it” success metrics:
- Improved sentiment and goodwill within the community
- Improvement to Strike’s brand and positioning in the market
Conclusion
If approved, the SGP will begin accepting applications for grants on a rolling basis shortly after its approval. To assist with the evaluation of potential grants, each grant will be classified into three buckets: high, medium, and low. High priority grants will be funded first; medium priority grants will be funded second; low priority grants will be funded last.
This program is a pilot. As such, we intend to keep the budget lean for a maximum disbursement of 2m USDT over six months across grants, setup and operational costs, and lead compensation. Make no mistake: this is an experiment. If the SGP works, Strike may want to graduate the program from a pilot to a full-time endeavor. If it doesn’t work, we will learn why it didn’t work and what should be done differently. Most of us are STRK holders here. That gives the privilege to try something that’s never been tried before at a meaningful scale: to let the test subjects run the experiments.
Let’s practice SGP together to bring more benefits to STRK holders.
Reference
SGP Request Form: https://forms.gle/jas762TF1Zzs3HU8A