[TPP-001] ZKsync Ignite Program (the "Ignite Program")

[hittite.eth]

support lets begin

[0x3F2Fd89D3a1cCAA02a]

good idea i will vote.

[natekoon.eth]

Thank you for the proposal. Great work!
Looking forward to the upcomming move from ZKsync

[woofi.eth]

This program is crucial for ZKsync Era’s competitiveness among Ethereum L2s. We hope it will also lead to infrastructure maturity through enhanced liquidity, including native USDC adoption (with major CEX support), diversified DEX aggregators, and third-party bridges.

Additionally, participation criteria should extend beyond TVL; for instance, WOOFi’s capital efficiency should be recognized and our tvl naturally scale up with more onchain trading activities. We account for 10%+ of ZKsync Era volume, and the highest volume for the ZK token out of all dex liquidity pools. Similar to Arbitrum grants, a dApp could qualify via TVL or trading volume.

We’re excited to see the program in action!

[sats]

Using $1M DeFi TVL as a criteria is a bad metric. WOOFi accounts for ~10% of daily onchain volumes and is by far the most capital efficient DEX on the chain.

Does it not having $1M in TVL make it less valuable?

[lex_node]

It would be much better if this proposal were accompanied by an additional proposal to decentralize emissions decisions using a veToken model like Curve/Aerodrome/Velodrome etc.

This type of mechanism has proven success, counterbalances the sell pressure on the token caused by the emissions while decentralizing governance over the emissions, and lets the market decide the best protocols to allocate the liquidity to rather than centralized and potentially conflicted committees–this would also presumably get rid of the “KYC concern” as there would be no centralized counterparty doling out the incentives.

All that being said:

• I realize zkSync governance is in an early state and there will be a lot of urgent commercial needs to serve before establishing better tokenomics mechanisms
• It’s probably more urgent that there be a liquidity program of any kind as fast as possible than to wait for the ‘best way’ to govern it
• The TPP is trustlessly ruggable by governance if we don’t like how it goes.

So at the moment, I am inclined to support the program but generally would encourage ecosystem players to try to establish some tokenomics value & governance flywheels for the token so that programs like this can be made more decentralized, market-based, and sustainable.

posted in my capacity as a delegate

[gh8st.eth]

This is a well-structured and thoughtful initiative. The ZKsync Ignite program not only promotes liquidity growth but also ensures transparency, accountability, and flexibility through iterative design and real-time performance tracking. Engaging both analytics providers and independent experts to guide token allocation is a smart move that balances strategy with oversight. Additionally, the focus on user experience and community feedback makes the program inclusive and adaptable. Overall, it’s a solid step toward fostering sustainable DeFi development on the ZKsync Era.

[0x41484a7229271C29c4]

lfg
Super exciting to see this

[ytolep]

Thank you for sharing the proposal for the ZKsync Ignite Program. I find the program’s objective to boost DeFi liquidity on the ZKsync Era ecosystem very promising. The allocation of 325 million ZK tokens over nine months, with a focus on strategic liquidity incentives, appears to be well thought out. I appreciate the iterative design with bi-weekly reviews, which ensures flexibility in achieving the desired liquidity goals. The oversight provided by the DeFi Steering Committee (DSC) and the transparency through public dashboards are excellent measures to maintain accountability. Overall, I believe this program has the potential to make a significant impact on the DeFi space.

[kuigas]

Overall, the Ignite program demonstrates a good balance of flexibility, transparency and community engagement that can effectively drive growth in the ZKsync DeFi ecosystem. However, there is still room for improvement in automation, standardization of incentive allocations, and participation thresholds. These adjustments will help increase the scalability and inclusiveness of the program, making it beneficial not only for large-scale agreements, but also for supporting innovative small-scale projects

[traderozy.eth]

@icanfly.eth

Congrats on the first proposal.

Congrats on the first proposal. It seems like a step towards a major and important decision has been taken. I fully support ZKSync.

[yuukii.eth]

Suggestions for the ZKsync Ignite Program

1. Simplify Rewards: Instead of weekly claims, let users claim rewards whenever they want. That way, both casual and active users are happy. Maybe even throw in an auto-compounder to make things easier.
2. Get More Community Input: Make the feedback process more structured with clear timelines or a voting system. This way, people feel more involved and heard when it comes to big decisions like pool choices or reward timing.
3. Keep Things Flexible: Regularly adjust token allocations based on what’s working. Having bi-weekly check-ins is great, but make sure you’re quick to pivot if something’s not clicking.

[alvcrotz.eth]

Make zk invincible in the future.

[rychardase.eth]

A summary for those who can’t go throught the whole draft:

The ZKsync Ignite Program proposes allocating 325 million ZK tokens over nine months to establish a DeFi liquidity hub on ZKsync Era. The goal is to increase DeFi TVL and enhance liquidity across interoperable ZK Chains, known as the “Elastic Chain.” Here’s an overview of the key elements:

Program Structure

1. Token Allocation:

   • 300M ZK Tokens: Distributed to participants in selected DeFi protocols via six capped minter contracts (50M each).
   • 25M ZK Tokens: Reserved for administration and unforeseen expenses, divided across four capped minter contracts.

2. Program Execution:

   • OpenBlock Labs (Analytics Manager): Reviews and recommends token allocations bi-weekly based on analytics, publishes quarterly performance reports.
   • Merkl (Technology Provider): Manages program operations, website development, and token reward distribution.
   • DeFi Steering Committee (DSC): Oversees key decisions, including veto power on program approvals, allocations, and renewals.

Goals

• Primary Objective: Consolidate liquidity across ZKsync Era to serve builders and users, enabling efficient access to a wide range of assets.
• Target Metrics: Track DeFi TVL growth, asset depth, and slippage reduction through live dashboards and quarterly reports.

Design & Timeline

1. Iterative Design: Bi-weekly adjustments to token allocations based on performance data, with real-time updates on the Ignite dashboard.
2. Program Timeline:
   • Set-Up (Oct-Nov 2024): Proposal review, vote, and launch preparation.
   • Three Seasons (Nov 2024 - Aug 2025): Continuous monitoring with seasonal reviews for adaptive adjustments.

Participation Requirements

• Eligibility: DeFi protocols must complete KYC, maintain a minimum $1M TVL, and integrate with L2Beat and DeFi Llama.
• Compliance: No sybil farming or metric manipulation allowed.

Infrastructure & Transparency

• Website & Dashboard: Merkl will develop a user-centric platform for liquidity participation and reward management.
• Analytics & Data Sharing: OpenBlock Labs will create public dashboards for tracking metrics.

Governance & Oversight

• Accountability: DSC or Token Assembly can terminate the program at any time. Any unused tokens will remain unminted, with relevant contracts destroyed at the program’s end.

The Ignite Program aims to create a dynamic DeFi ecosystem, learning from prior incentive programs while maintaining transparency and governance integrity.

[nanostrategy.eth]

Without a doubt, this is a good proposal that will bring many benefits to the zkSync network, but I believe that in the initial stage, 300 million zk is too much. I suggest the proposal authors review the funding and reduce the number of tokens, otherwise, I will be forced to vote against it. I have already seen such large allocations on Arbitrum, and they brought nothing but a decrease in the token’s market price.

I also support Gabriel’s words and believe that 25 million zk is excessive

@Gabriel

@BaptistG

25,000,000 ZK tokens distributed between 4 capped minters will cover the administration costs involved in deploying and managing the program over the nine month period, and includes a buffer for unforeseen circumstances. Any ZK tokens that are unused will remain unminted and the related capped minter smart contract will be destroyed upon conclusion of the program.

Ive read all the allocation of the 25m ZK and i still think this is excessive. Is more than 7% of the program. What are the kpis for the bonus allocations?

Also a 12,115,000 zk discrecional use? This needs to be detailed and aproved as needed imho.

Thanks for posting the first TPP, Zk is the endgame.

[musicens.eth]

great proposal! Looking forward to it!

[screenbooy]

thtat´s a great point, i will vote

[nicrypto]

great stuff, waiting top start

[cap]

Very happy to see the first TPP! Writing my thoughts and comments as I read through it.

@BaptistG

Every 2 weeks, token allocations will be defined and streamed towards specific pools/assets in participating DeFi apps/protocol at the recommendation of the program’s analytics provider (OpenBlock Labs), which is subject to review by an independent group of experts called the DeFi Steering Committee (DSC)

Although I’m not necessarily against this, this is not how envisioned TPPs would work. This defeats the purpose of having onchain trackable metrics (and the entire design of TPPs) if a group of people will select where the money is allocated. Unless the TPP and all its contracts contain updatable logic as to how funds are being distributed toward participants (based on updatable criteria and onchain metrics) and then OpenBlock Labs could iterate as needed.

@BaptistG

25,000,000 ZK tokens distributed between 4 capped minters will cover the administration costs involved in deploying and managing the program over the nine month period, and includes a buffer for unforeseen circumstances.

For transparency purposes, it would be desirable to have a cost structure breakdown of how 25,000,000 would be spent, or are expected to be spent.

@BaptistG

Recommending how ZK tokens are allocated, to be updated every two weeks based on observed data

Again, I’m not against this, this is how most grant programs work but I assumed predefined (possibly upgradable) contract logic would be ‘in charge’ of where the tokens are allocated. Otherwise, power is concentrated with people and not a self-executing contract design process.

@BaptistG

We hope to learn through this program what is necessary for automation in the future.

Well, this renders my previous concerns moot. Thanks for clarifying. I’m glad to see that you keep autonomy and automation in mind and hope to see future TPP designs getting progressively better.

@BaptistG

Analytics Manager (OpenBlock Labs) will propose recommendations for which assets, pools, and applications will receive ZK token allocations every two weeks.

It would be helpful to have a framework for decision-making based on some criteria as to who gets the tokens, public and available for everyone to see so everyone knows what defines good performance and what metrics are being tracked.

@BaptistG

• Must not encourage or participate (directly or indirectly) in sybil farming, spoofing metrics (such as TVL, users, etc), or other activities that are abusive or inconsistent with the purposes of the program

Just out of curiosity - how are projects protecting against Sybil farming? Should we have some precise requirements for that?

@BaptistG

Contributors

Once again, I make a comment about something above (cost structure breakdown), and a few minutes later I find the answer. Great job on this and thanks for sharing.

@lex_node

It would be much better if this proposal were accompanied by an additional proposal to decentralize emissions decisions using a veToken model like Curve/Aerodrome/Velodrome etc.

This

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Extremely well-written proposal! This is the standard by which all future proposals should be written and measured.

Seems like the benefits heavily outweigh the concerns so I won’t nitpick the details.

Big +1 for this proposal!

[Michael]

I’m pretty concerned about the size of this program and that it doesn’t allow for future deployments on ZKSync to participate.

This program outlines spending on incentives roughly equal to 50% of current defi TVL!

Also, are we expecting these protocols to apply for incentives themselves? Why not just approve them on a case-by-case basis, allow the protocols to manage the incentives themselves, and skip the high management fees as outlined by @daniel-ospina.

Time and time again, the first couple proposals in a new DAO shoot for the moon and dramatically over-ask while the DAO is getting it’s footing.

While we are all excited to start seeing some programs in, I caution my fellow delegates to exercise prudence here.