GMX Delegate Statement Template

CastleCapital · May 17, 2024, 11:09pm

Name: Castle Capital

Wallet Address or ENS: 0xE9e330f9Fc82145AebF1D89393e358682Ea5f67e

Tally Profile URL : (add your profile link here) : Tally | Castle Capital

Are you a service provider?

No

However, Castle Labs, a separate entity, operates as a service provider for DAOs and protocols.

Do you understand that delegate incentives will not be available for the first 6-8 months? We plan to incentivize delegates once we have gathered enough data, likely in the next 8-12 months?

Yes

What area are you most interested in contributing to? choose up to two tags:

Defi
Perp Dexes
Infrastructure & Protocol
Dao Governance
Developer Tooling
Grants & Public Goods Funding

Introduction:

Castle Capital is a research collective deeply rooted in the on-chain world, offering a unique perspective that aligns with the needs and dynamics of market participants and DeFi power users.

Our collective is a blend of on-chain natives – researchers, analysts, builders, and traders – who are not just participants but active contributors to the crypto ecosystem across protocols and DAOs. This diversity ensures a comprehensive understanding of the market, from technical intricacies to user behaviors. Our USP lies in our deep integration with crypto communities. We don’t just observe; we engage, interact, and evolve with the market.

Many of our members sprung into action off the back of the exciting developments of GMX’s Arbitrum launch after being community members of its predecessor protocols. As long-term GMX community members, DeFi contributors, and Arbitrum DAO delegates and service providers, our astute team is capable of delivering an impartial and decisive approach to governance within the GMX ecosystem.

Background:

Castle Capital is a long-standing private community, created in Nov 2022. Its early members were largely made up of a strong and cohesive group of DeFi enthusiasts, especially those who had taken the leap of faith with GMX to Arbitrum. At this time and in early 2023, Castle had a solid cohesion of GMX contributors, community developers, tokenholders, community advocates, GMX traders, and Perp DEX researchers that greatly enhanced the proliferation of GMX’s influence throughout the space.

Since then, Castle has evolved into a much wider collective, with new members, new expertise, and new horizons, expanding our understanding and influence across DeFi and DAO governance. We believe this makes us an excellent fit for a delegate in GMX’s governance system as the protocol moves towards decentralization.

Along with our multidisciplinary collective and a strong early GMX cohort, we outwardly operate in the following ways:

Public research and education in the form of weekly newsletters and longer-form blogs
Servicing and advising protocols and DAOs across a multitude of areas
Researching, analyzing, and investing in teams and technologies

These external-facing arms to the collective ensure we are up to date and on the cutting edge of the industry in terms of our knowledge, expertise, and experience.

A few of our capable community members are:

Atomist, the founder of Castle, was an early community developer at GMX when Arbitrum tooling was lackluster. Since then he has grown Castle into a reputable collective, most notably penetrating Arbitrum governance as both a delegate and a Service Provider, where we were appointed for the have the role of Incentive Program Advisors, advising nearly 70 teams.

DeFi Mann, a strong vocal advocate for GMX, its metrics and superior architecture, DeFiMan is well known for his definitive and extensive coverage “Deciphering GMX V2”, which helped clearly outline the importance of V2 and every minute detail and consideration of it.

Shogun, Dune connoisseur and GMX contributor, Shogun has a strong footing in everything data, DeFi, and DEXs. An integral part of the Castle, bringing with him a unique and data-driven point of view. His most recent role at Steakhouse only bolsters his repertoire and grows his DAO experience every day.

relied, a long-standing community member and Perp DEX advocate. Relied has been with GMX from the beginning, and has a deep understanding of the community as well as that of other DEXs in the space.

Along with many other OGs, such as CLblockchain, KalCrypto, GMX Intern, defipleb, Inlumino, kwizzles, 0xVlad, and Sheriff.

Motivation:

Why are you interested in becoming a delegate for GMX governance? What motivates you to actively participate in GMX governance?

We have been very vocal in emphasizing the significance of governance, in particular emphasized by our involvement in Arbitrum DAO. As a select group of our members are long-standing GMX community members, researchers, and advocates, we thought it was only right to give back to the community and offer our expertise in helping to decentralize the protocol.

We have a deep technical knowledge, utilization, and capability in emboldening the GMX product, its ecosystem, partners, and of Arbitrum.We have a deep technical knowledge and understanding of the GMX product, its ecosystem of partners, and of Arbitrum. Our expertise also spills over into the derivatives space and GMX’s competition, where our members are in their communities, advising their teams, and contributing to their protocols. We have access to engineers with strong data experience, allowing us to have a metric-driven approach to decision-making within the DAO. All of these, along with our deep-standing history, means we are well positioned to give back to the protocol and community that gave many of us a positive leg-up in crypto.

Sample Voting Issues

Sample Voting Issue 1

In February 2024, a governance proposal was posted in the Uniswap Governance forums, where the Uniswap Foundation proposed a large-scale upgrade to Uniswap protocol governance to incentivize active, engaged, and thoughtful delegation. This proposed fee mechanism rewards UNI token holders who have delegated and staked their tokens. For background, Uniswap is one of the leading DEXs across all EVM ecosystems. The link to the proposal could be found here (Link 1).

If you were a delegate, how would you vote on the proposal?

No

Please provide a reason for your vote of yes/no to the proposal.

It can be viewed as questionable to incentivize/force democracy across the board, potentially leading to unintended consequences (although it depends on the % distribution of fees to this mechanism). Whilst we believe governance participation should be incentivized, maybe it shouldn’t be with the entire revenue stack, but via other means or a limited small %
Stale delegation needs to be addressed still - e.g. what if a delegate is inactive?
The proposal doesn’t incentivize delegates themselves, only passing responsibility to someone else - it is unclear how this will be managed
There are further complexities where the token may be used by tokenholders as collateral and not in a staked form - therefore the proposal needs to take into account wrappers or grants for wrappers etc.
Immutable staking contracts could be troublesome and requires proper debate around how best to design and execute the smart contract side of the proposal
The proposal may hinder/impact existing delegate incentive programs - much more clarity and reassurance is required in our opinion
Any fee re-distribution needs to ensure LPs are not negatively impacted leading to a reduction in TVL and potential volume - this should be backed by empirical evidence

Until the above concerns are addressed we would be voting No, however, we believe it is an interesting proposal and that intertwining fee-sharing and governance participation will be good for the ecosystem as a whole.

Sample Voting Issue 2

In March 2024, a governance proposal was put to a vote in the Arbitrum Governance, where Savy DAO introduced the STIP Bridge proposal. The aim of this proposal is to sustain and enhance Arbitrum’s market leadership by extending support to key protocols amidst intense competition from other Layer 2 solutions. The proposal suggests that the protocols funded in the STIP and STIP Backfund should be eligible for funding requests of up to 50% of their prior funding, based on the impact created by them in STIP. Here’s the link to the proposal:(Link 2)