ARC-132: Astroport Protocol Development Fund via Maker Fee Revenue Allocation

Proposals ARC (Astroport Request for Comments)
1

Summary

This proposal seeks to allocate 50% of the Maker fees revenue generated by the Astroport protocol to a dedicated Development Fund. This fund will provide the resources necessary to support continuous protocol development, research, and innovation, ensuring Astroport’s long-term growth, sustainability, and competitiveness in the decentralised finance (DeFi) space.

Abstract

Since the inception of the Astroport Protocol Foundation (see: ARC-57: Astroport <> Neutron), no funding has been provided by the DAO to sustain its operations. Traditionally, projects rely on selling DAO-held tokens (either OTC or on the market) to fund development efforts. However, we believe a revenue-based approach is more sustainable, predictable, and aligned with community incentives.

By allocating a share of the protocol’s Maker fee revenue, the Astroport Protocol Foundation can ensure continued development without requiring token sales, which may exert downward pressure on ASTRO’s value. This funding model better aligns long-term protocol success with the interests of all stakeholders.

The development fund will ensure Astroport remains competitive and innovative in the ever-changing DeFi ecosystem. This initiative will enable the protocol to scale, improve its user experience, and foster collaborations that expand its reach and utility.

Proposal Details

Revenue Allocation

  • 50% of the Maker fees accrued will be allocated to the Astroport Protocol Development Fund, ensuring consistent resources for ongoing development and innovation.
  • The remaining 50% will continue to be allocated per the existing model, where funds are used for ASTRO buybacks.

Usage of Development Fund

The Astroport Protocol Foundation will utilize the Development Fund to finance the following:

  • Protocol-related development efforts, including scaling and implementing new features.
  • Enhancing user experience through continuous security improvements and system optimization.
  • Ensuring the sustainability and expansion of the Astroport ecosystem.

Sustainability

This revenue allocation strategy ensures a sustainable funding mechanism for the Astroport Protocol Foundation. By tying funding to protocol usage it creates an aligned incentive, also this model guarantees the financial resources needed for development without requiring token sales.

Contract Changes

The maker contract will be modified to include a configurable parameter for a designated Development Fund recipient address. It will also be updated to support distributing a specified percentage of accrued fees into a designated denomination (e.g., USDC).

Executable Message

To be added soon.

Conclusion

This proposal establishes a sustainable funding model for the Astroport Protocol Foundation, ensuring that resources are available to support the continued development and growth of the protocol. By allocating a share of Maker fees to the Development Fund, Astroport will remain a competitive and innovative leader in the DeFi space, benefiting all stakeholders in the ecosystem.

Copyright

Copyright and related rights waived via CC0.

1 Like
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My thoughts on this are as follows.
I agree with the whole concept of aligning funding payments from fees/incentives since this is a flywheel effect of shipping great code and features should nett gains across the astroport ecosystem and increase fees.
However, 2 main issues here for me.

  1. why 50%, what justification is there for this high sum? I understand it can be reduced through gov, but the reverse is also true, why not 25% or some other figure. no effective justification has been provided?
    2.the timing doesnt work. the team need to ship meaningful code before this could even be considered in my view, cockpit isnt good enough, O pools need to be operational
1 Like
3

I understand all of your points.

  1. At current fees generated 50% is roughly around 40k$ a month, which should be enough to cover around 75% of the operating costs of the Foundation. We would like for this number to be less, as volume increases we will make sure to update this amount (since it will be configurable).

  2. We have been working on Duality integration, it’s currently under audit and will be soon release, that should meaningfully increase volumes, we are also actively working on Tributes to vxASTRO voters as well as the “O” pools.

4

It’s vital that Astroport team are adequately funded, otherwise team members may drift away to look for other opportunities. I want the team to be funded and motivated to grow Astroport.

If the proposal goes up with the current 50% of fees going to team, at what stage would this percentage potentially be reduced? If volume is consistently 2X current levels? 10X current levels?

Might be nice to see a chart. Fees X, Devs percentage Y.

At the end of the day, tech is nice. But what is being done to bring users and liquidity?

1 Like
5

Allocating 50% of Maker fees to fund development makes a lot of sense. It ensures continuous innovation, scalability, and security without adding sell pressure. Ideally, this percentage can be lowered as protocol revenue grows, but for now, it’s a smart move to sustain long-term success!