Provide liquidity with the balanced DAO's fund on OMM money market protocol

The DAO needs to obtain and maintain sustainable cash reserves for future sustainable development and maturity. Currently, the Balanced DAO holds decent stable coin money. The DAO needs to manage the DAO treasury to finance the DAO development.


The DAO has around 832K bnUSD. The DAO can provide liquidity to the OMM money market to earn OMM rewards and interest fees.

If the OMM contract has a vulnerability. then the DAO’s fund can be at risk.

I’d like the DAO experiment to provide liquidity to the lending protocols with a small amount of money. As the OMM protocol is mature, the DAO can increase liquidity.

I’d like to hear the community’s feedback.
Sorry for my bad English. It is also my first suggestion in the forum.


I am supportive of using Balanced assets to lend on OMM. I agree that this could be a nice mutual beneficial relationship to increase yield. I have read some things on this but nice to have a topic open on the forum. We could use LP assets to lend on OMM. Using DAO funds is also interesting but I guess this will require a vote everytime we move assets.
Makes sense to do a trial run but not sure if that is required. Depends on how well we can test this (on testnet or by other means).


Hey @octocat512 - I like this idea. It helps Balanced earn interest while also making Omm a more appealing platform to borrow from, because it has more deposits.

I think starting with a small amount makes sense.

My other question is:

What percentage of the DAO Fund should be allocated to lending on Omm versus Protocol Owned Liquidity?

Before your post, my thinking was to use all of bnUSD in our holdings to supply to sICX/bnUSD pool, or maybe IUSDC/bnUSD, etc.

I am curious your thoughts about which is better use of funds. My initial feeling is that we can do both, with a higher percentage allocated to being an LP on the platform to ensure continued liquidity for our important pairs.

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Doesn’t LP currently cost Balanced(have a yield) that is higher than the OMM money market? As it should as it is more risky. But this is a risk that should be entirely acceptable to the DAO as it has the side benefit of supporting the platform, is there any particular benefit to go for the money market over POL?

Actually, I like the Protocol Owned Liquidity Idea because it can enable idle tokens to work. But I think the DAO will have an impermanent loss. finally, can be a final loss. I’m not sure providing the AMM liquidity can be profitable for the DAO. Could you provide me the proof that earning fees and rewards can more than impermanent loss? Can the DAO control the withdrawal and deposit liquidity? The DAO has to be a professional market maker. How the DAO will handle it? I think managing the DAO treasury is for financing sustainable development funds at the bear/boom market time.

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Right, in the balanced V2, the balanced team will implement boosted pools(Boosted Pools - Balancer). It is a rumor from me. :joy: I’m really a fan of boosted pool idea. I think half of the balanced DEX liquidity can be liquidity on the OMM.
But, In this suggestion, I’d like to focus on managing the DAO treasury.

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As you mentioned, DAO can have impermanent loss as an LP. but I think providing liquidity on lending protocols doesn’t have any economic risk. but the DAO can’t utilize the BALN token and sICX. I’m also not sure which one is more profitable and more beneficial for the balanced DAO.

First thing I want to do is stop using the word “impermanent loss”, because I think it is a ridiculous term created by the industry to trick users haha. See my opinion here.

Anyway, yes, @octocat512 being a liquidity provider could cause a loss for the Balanced DAO. Being an LP is a specific trade, it’s like choosing to use bnUSD in the DAO Fund to buy BALN. Maybe it will be a good trade, maybe it will be bad.

However, one thing that is different about the DAO Fund is that the DAO Fund actually needs liquidity to continue growing. Unlike a normal Balanced LP, where 0.15% of the fee goes to the LPs and 0.15% foes to the DAO Fund, if the DAO Fund is an LP, it benefits from both the 0.15% that goes to DAO Fund and the 0.15% that stays in the pool.

Yes, there is still a risk of loss, but it would be beneficial to BALN stakers and traders, which has more benefits to the DAO Fund compared to a normal Balanced LP. Also, with boosted pools, being an LP will be the best decision.


we can put aside 500k into both LP in Balanced and 250k in OMM lending to diversify the dao fund. If any better investment in future such as optimus, we can put some of the fund into it as well. But any place to track all those fund?

I would say offer a large portion of DAO fund for liquidity, just don’t lock it up for four years. With boosted rewards it will incentivize LPs to lock if they know our DAO won’t be going for max rewards. But more liquidity is a incredible idea, but we also don’t want to lower LP rewards too much.