As GMX matures, our growth will come from additional products and new traders but significantly also from an expanding ecosystem of partners that are building on GMX. Partners bring expanded communities, development resources and through joint efforts innovative new DeFi products allowing GMX to be introduced and used by more people.

As a protocol, we have 1.0m tokens reserved for marketing, partnerships and community developers. In terms of utilizing tokens for partnerships, the typical approach for most protocols is towards incentives, grants and bribes. While these levers will be utilized as appropriate, in the coming weeks we will have multiple plans that instead focus on treasury swaps with protocols that are building on GMX.

Key Benefits

  • Swaps result in both protocols having a joint interest in long-term collaboration
  • GMX gains a commitment toward the platform being part of these protocols’ development plan be it as a source of yield, trading on the platform or some other combination.
  • esGMX yield provides partners with a natural source of yield to fund incentives for the products they are building on GMX.
  • GMX has an opportunity to diversify its treasury through strategic investments
  • utilizing esGMX removes sell pressure and instead reinforces long term alignment

Key Risks

  • Investment in crypto is risky and investment especially in seed round transactions or in other early-stage projects comes with a higher than average failure rate.
  • Development of products in collaboration with GMX will lead to varying levels of success and may not lead to products that achieve product-market fit
  • While most protocols proposed for swaps are aiming to build out sustainable real yield strategies similar to GMX, there is no guarantee that they will succeed or that the future yield we earn will compare to the yield paid out on the esGMX swapped.

Terms will vary but the typical structure would be:

  • a swap of esGMX using the 30-day average price proceeding the swap
  • pricing for other protocols based on a prior seed / private sale round if unlisted or the same 30-day average price methodology used for esGMX
  • Both parties will maintain lock-ups on their positions of mutually similar lengths
  • Where possible tokens received by the protocol will be staked on their platform and used to boost GMX/GLP usage if possible
  • Our goal is to achieve a fair transaction but GMX ‘return’ from such swaps are more about the long-term development of products on our platform and not about trading the market.
  • Transactions are sized to avoid undue influence over other protocols or vice versa
  • Proposals may be posted by core contributors or the protocol a swap is proposed with, along with feedback from the core contributors involved in reviewing the proposed swap.


While the strategy has been articulated individual swaps need to stand on their merits. In the coming months, we will establish a set allocation of GMX tokens, with a small committee of contributors evaluating and negotiating these opportunities financially and in terms of their benefit to the protocol plus handling long-term decisions related to these investments.

In the interim, a token swap that involves a commitment over $50,000 will come to the forums for feedback and votes.

  • GMX has an opportunity to diversify its treasury through strategic investments

Based on whats been seen so far I don’t think it’s fair to consider these investments as diversifying the GMX treasury. Rage Trade and Plutos are heavily reliant on GMX’s success, making their tokens basically the same bet.

Maybe this changes with the other partnerships and new products created by those partners, but the community should keep this in mind and not consider the treasury to be diverse because it’s holding assets like PLS and RAGE.

  • Our goal is to achieve a fair transaction but GMX ‘return’ from such swaps are more about the long-term development of products on our platform and not about trading the market.

These swaps will make it more profitable (by default) for LPs to provide liquidity through our partners than through the GMX contracts directly. This could result in those partners controlling the majority of our liquidity as LPs move to the higher yield. That gives partners a lot of control and increases the SC risk of our protocol. On top of this GMX has found product market fit, generates real yield and the token pays a dividend.

For these reasons, if we are doing these swaps I don’t think we should be doing them at equal valuations. GMX should be pushing harder for a discounted rate and higher stake in these partners.

How do we handle an exploit?

Let’s imagine a scenario where one of these partners is exploited and many millions of $ are lost. (Not too far fetched for Defi, id expect at least one of the protocols to experience this at some point.) A lot of the LPs are naturally going to be coming from the GMX community.

Because we have provided esGMX to boosted their yield, partnered with them and maybe even promoted the use of their product. Thats going to put a lot of pressure on GMX to assist in making the users whole again. If we don’t assist, it’s likely going to disrupt a lot of the community who feel abandoned which would be bad for GMX’s image going forward.

This is a social consequence for picking winners.

Just want to clarify

I do believe there is benefits to partnering with these projects and these benefits are highlighted well by others. I just want to highlight that

  • The risk may be more than just losing a few esGMX on a failed investment.
  • We should still be vigilant with our treasury diversification

Plutus is mainly focused on capturing Dopex governance power and will thrive whenever Dopex thrives. I don’t really think they are heavily reliant on us IMO.

I do agree that I would prefer swaps that focus on the native liquidity of the platform and not parasitic pools other protocols can use to hijack our liquidity.

Things coming to mind which benefit the native GMX platform:

  • STFX
  • Dopex, as they are building ‘non-liquidatable’ positions on GMX.
  • All protocols that deliver value and volume through the GLP pools which can reduce the esGMX emissions we have to give on GLP pools as the APR will be sufficient to boost incoming new liquidity.

Fair points on all sides. I believe there is substantial value in these partnerships, and reinforcing them through such mutual swaps. Meanwhile, let’s indeed remain vigilant about the potential risks.

Thanks for the nuanced point of view @coinflipcanda

Couple points, I think are worth re-iterating:

  1. Swaps are particularly valuable as a short term bootstrap
  2. This bootstrap is far cheaper than continuous GMX/esGMX emissions
  3. Diversification of GMX treasury is great in that it opens new revenue sources for the DAO (from protocols like Plutus, Umami, and Rage)
  4. As long as esGMX emissions are treated as purely a bootstrapping mechanism rather than a long term yield boost, then setting up a process to build these partnerships can be streamlined.

Additionally, addressing @PSY’s concern around exploits - I think projects participating in these swaps should be vetted based on track record + ability to deliver a secure product to market. And no swaps should be initiated before a qualified audit has taken place.

@Tano I do agree that STFX and Dopex should be considered as projects for such token swaps. I think protocols that build on GLP also benefit GMX stakers - there has been a linear relationship b/w more liquidity and fees generated for GMX/GLP stakers (in part due to arbitrageurs).


I may have missed it, but do we have a good public dashboard that tracks how this has been deployed, how much is remaining, who are the responsible parties (aka who’s the point person on either side), and tracking how results have trended vs. what we originally expected from the partnership/marketing effort?

Here’s a good example of another protocol that tracks this stuff somewhat well: +

If the core contributors don’t have the capacity to pull together something like this, this might be a good project for community members (and future GMX contributors) to start with.

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Dashboard/ Record of Marketing/Incentive allocation for transparency and accountability

@randomishwalk asked a great question and I fully encourage creation and maintenance of a clear record which shows any swaps and allocations , marketing spend, etc. presently - this is unavailable beyond digging through governance proposals and forums. It’s been asked in the main group many times as well and perhaps an updated tokenomics dashboard with a section that breaks down marketing fund drawdowns/ remaining would be ideal.

Deeper discounts/better valuations of swap tokens in line with lockup / risk differential

@coinflipcanda I also strongly agree with another poster that negotiating these swaps should yield higher discounts on acquired tokens particularly when products are completely unproven. Placing a proven revenue stream in the hands of a team should come at a disproportionate expense to them and their token holders in terms of allocation. In other words, I fully support bootstrapping partner pools and other teams that wish to build within the gmx / glp ecosystem, but valuing their tokens at the most recent round is not appropriate considering the longer commitment / locks of treasury tokens vs their likely early investors and even teams who may not share the same long term commitment/locks.

**Bootstrapping pools / teams with borrowed yield - not solely permanent treasury swaps - accountability of partner teams **

Further, if bootstrapping a pool / user adoption and incentivizing liquidity and development efforts by partners is in fact the main purpose of these swaps, why not entertain a smaller permanent token swap paired with a similarly or larger sized “loaned out” allocation of esGMX whose yield would achieve a similar outcome, demonstrate GMX’s support of partners, and would allow later governance votes on whether to forgive loans based on performance criteria or extend them for another period of time.

GMX has provided GMX liquidity to CEXs, so allowing decentralized partners to temporarily hold and benefit from esGMX is no different. After - let’s say- 2 years have passed it would be their responsibility to update the GMX community on the impact of their incentivized products on the ecosystem, justify the shared expense / yield benefits transferred, create presently lacking accountability of other dev teams and be a much easier pill to swallow for GMX holders in the future. Moreover, if their products or pools manage to be self-sustaining, in some ways additional incentives may well be either insignificant or demonstrably unnecessary, or could be redirected toward new development / bootstrapping goals by the partner team.

Precedent of swap terms and managing expectations of teams who build competing or copy-cat products and expect same treatment as other teams

In addition, I also strongly object to future proposals including entitled-sounding language that boils down to “we just want the same thing that this that and the other team got, because we are building something similar”. It is what really turned me and many others off from the Rage proposal and should not be the central thesis or argument why you want bootstrapping or a specific amount. This will become an even greater concern going forward as we establish precedent with these swaps which future proposals will cite or claim to rely on.

During a bull market there will be a flood of copycat protocols / ideas that are repeated/rebranded and spun up to garner investor interest, often to the benefit of early investors and the team of these projects, but few others and often unsustainably , and I would imagine that many similar Glp delta neutral pools (legitimate as they may be) will pop up and seek favor and bootstrapping help from GMX. We must not wait for the saturation of a market or product segment to become self-cannibalizing or obvious, but should insist on and demand from partner teams to demonstrate their unique approaches, long term plans, and expect innovation on a technical and fundamental (product offering) level, if we are to share yield to support them in their endeavors going forward.

Conflicts of Interest and disclosures

There have been accusations or insinuations in both directions that someone arguing in favor of a proposal had a vested interest in the proposing project or that someone opposing it had an interest in a purportedly threatened or competing project. While it is appreciated and should be understood that core members of the team would make disclosures related to interests in these projects, there are some community members (with potential significant token holdings in both projects) such as Dovey (in the case of Rage), Messi, etc. who are active in the venture space, and can therefore have significant governance rights/influence and conflicts of interests. Taking personal responsibility to make disclosures should be encouraged by the team, and at a minimum, including what if any community members were involved in introductions or negotiations on proposals should be clearly disclosed in proposals. A lack of transparency / forthrightness is always a major cause for concern and diminishes otherwise perfectly mutually beneficial proposals. (For what it’s worth I presently hold no Umami, Rage, Dopex or Plutus tokens) As the ecosystem grows it is likely that more perceived or real conflicts exist and open acknowledgment of these will go a long way to strengthen trust among community members.

Thanks Coinflip and team!


Should they be pure equal value swaps, or should esgmx get seed / pre seed rates. As these swaps are likely used to jumpstart some vcs seed round sell off once the coin lists, should esgmx not enter on equal terms?

I would also love to see the fees generated to date from the volume brought on from a swap partnership in comparison to the total value of esgmx given at the time.

Sorry, this is a low effort post.

@randomishwalk thank you for sharing the lido links, and no we don’t currently have a dashboard of this type. Dashboard of our protocol esGMX swaps will be a good start and we’ll try to see how best to address.

Connecting with the Lido team to understand how they have constructed it and then we can see if a contest or other initiative similar to our community dune dashboard contest makes sense.


Have we made any progress on this? Particularly in light of the STFX swap snapshot would be awesome if there was a public-facing treasury swap tracker and some type of KPI (or progress?) monitoring so we can continuously re-assess how effective we are at underwriting these types of deals/partnerships

Hey what would you want to see on the swap tracker @randomishwalk ? Is it mostly token value or some other type of more qualitative KPI?

I’m at Hedgey - we’ve built out a few swap tools that DAOs/token projects use to swap on these type of partnerships and would love to build out cool stuff that goes beyond that swap itself. Would be down to build out something that helps this type of visibility.

Adding @coinflipcanda to this if you have any thoughts

Hey thanks for posting! Just to confirm this is Hedgey correct?

It’s an open question of what the key metrics are that we should show. I think at a minimum I would love to see the following quantitative and qualitative data:

  • Name of counterparty
  • Point person from GMX-side
  • Point person from counterparty-side
  • Type of partnership: strategic vs. financial vs. hybrid
  • Brief description of the agreed-upon terms of the partnership
  • Financial detail around token swaps or any other exchanges of value (cash flows, future token emissions etc)
  • OKRs - what did we expect to come out the partnership?
  • Comparison vs. OKRs - and how do results compare to expectations at various milestones (i.e. 3mo’s out, 6mo’s out, 1yr, etc)

@lww - any chance you could also share here Hedgey’s portfolio of work / past case studies on what you’ve done for other DAOs? Seems like you have an impressive list of logos on your homepage!

Also @Micnation - what else would you want to see here?

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great i agreed with the proposal gmx will the future that’s unique idea

Hey @randomishwalk - thanks for the notes - these are EPIC!

And yes, you have the correct Hedgey linked.

Seems like the metrics could be a mix of self entered info (OKRs, terms of partnership, etc) and simple on-chain info like the token value, swap amount, etc. Really cool ideas - would love to whip up a mockup and get your thoughts on it.

As far as our work goes, thanks for the kind words haha. We’ve been lucky enough to work with some awesome projects.

At a high level we have pretty straight forward protocols that DAOs/token teams use for treasury swaps, diversifications w/ baked in vesting periods, and sending out locked token rewards to contributors.

As far as DAOs who use us goes - Gnosis, Gitcoin, Shapeshift, DAOhaus, Thales, Alchemix are a few.

I don’t want to bombard the thread with links or too much about us, but always down to share more and chat on ideas though. GMX seems super active on this stuff which is awesome.

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Happy to discuss, we are looking at a solution and approach for how we present these treasury collaborations.

A pure financial value of the two assets may not make sense since we are intending for these to be effectively permanently locked positions. So it would more likely look at TVL attracted, yields paid out to stakers, volume driven into the platform.

The challenging part is spliting up induced demand vs latent demand which is just a transfer over and then quantifying the value of broader visibility these integrations bring to GMX in terms of people who additionally natively use us after indirect introdocution.

Obviously step one is looking at the first order benefits

Feel free to hit me up on telegram (@coinflipcanada)

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this is awesome feedback @coinflipcanda . The fact that the plan is to hold these indefinitely would definitely make sense to shift what you want to see more to what the partnership brings GMX. I think we could do something cool here for sure.

Will ping you on Telegram and from (@ goforlindsey)