Proposal for Inverse Finance DAO to cover operations of the Product Working Group (PWG) in Season 1, running from October 1st to March 31st.
The core responsibility of the Product Working Group is the design, development, deployment and maintenance of Inverse Finance smart contract systems and associated interfaces.
The transition to a fully empowered PWG started with Proposal 100, which established the Product Working Group multisig and gave it funding to pay for ad-hoc auditing work. It has since been given further resources to pay for a trial period of a part time smart contract developer.
The product life cycle at Inverse Finance typically go through the following steps:
- Ideation of new product or feature for existing product.
- Evaluation of the idea across the entire team of core contributors.
- Design and specification of the idea.
- Development of necessary code to support the idea.
- Testing of the new product or feature.
- Review of the new product or feature both internally and externally.
- Deployment of the new product or feature.
- Maintenance of the new product or feature.
The core contributors of the product working group take a deep part in all of these steps, and fully own accountability for steps 3-7. Part of that ownership is not just to execute on the tasks, but to make sure that it’s being done in a manner that maximizes security of the developed systems.
The northstar of season 1 at Inverse Finance is to reduce bad debt. This can both be done by making current operations more efficient, making our current offerings more desirable for customers, or making new products that increase revenues for the DAO. The Product Working Group is well positioned to positively impact all of these.
The PWG, alongside TWG, is on constant lookout for increasing DOLA bribe efficiency and demand by integrating with other protocols. We’ve already seen big success with this strategy with partners such as Velo/Aerodrome, Convex Finance and Aura Finance.
As for increasing user adoption, the PWG will maintain the security and usability of our current product offerings, along with:
- Deliver on projects mentioned in the 2.3 Projects section.
- Increase utility of FiRM markets, by:
- Making it easy to leverage positions and tear down positions.
- Use harvested yields to pay back debt or increase collateral positions.
- Refinance debt from other lending protocols to FiRM
- Expand the selection of attractive FiRM markets both on mainnet and layer 2’s
- Hosting and maintaining https://www.inverse.finance/
- Offering best in class transparency dashboards for applicable Inverse products.
- Integrate with third-parties technology solutions
- Develop and implement new types of escrows for FiRM unlocking new collaterals
- Expansion of new Feds to ensure the efficiency and availability of DOLA liquidity.
- Continuously improving our product development process both in terms of transparency, security and productivity.
- Assure product security by:
- Stress testing internal systems and checks
- Continuous built out of testing suites
- Continuous engagement with high-quality 3rd party code quality & security consultants
Along with the incremental improvements of products and systems, the PWG plans three major releases for season 1:
FiRM has been a big success for Inverse Finance, having $50MM TVL and over $20MM worth of borrowing, benefiting INV holders. As with all products, once they’re taken into use, improvements and desired features are discovered and our goal is to build the best protocol for fixed rate lending in the space, with the security and TVL to match. In version 2, we will go over every little detail protocol and apply the lessons we’ve learned from a year of operation, making upgrades wherever things can be improved.
FiRM on Optimism
Another big push will come in the form of venturing out from Ethereum and making FiRM truly cross chain. While DBR rewards will continue to flow to INV stakers, stakers will now be able to decide which supported network they want to withdraw their DBR on, which in turn will support network specific assets such as OP and VELO.
Accelerated Leverage Engine:
The accelerated leverage engine is meant to easily allow borrowers to lever up and deleverage their positions on FiRM in one transaction. We believe this will unlock more borrowing activity, as borrowers will no longer have to manually loop their borrowing activity to lever up, but can instead do it without a hassle.
While these items make for the big deliverables, the PWG will also be focusing on smaller projects such as escrow specific helper functions and any projects that may increase DOLA demand and bribe efficiency.
The PWG will measure its success in the following ways:
Security has become an ingrained part of the process at Inverse Finance, and we hold ourselves to the highest standards of the industry. Not only do we consider major security incidents that cause a loss of funds a failure, but even the discovery of a failure mode in deployed code that isn’t exploited or activated, is considered a failure of our process as well. We will measure success in this area by the amount of high impact bugs and high payout bug bounties. We aim for 0 on both.
It’s not only important to build secure products, but also useful ones. A clear metric for success for the PWG is how much our products are used. This is primarily measured as revenue growth for the DAO, and TVL growth, with revenue growth being more of a lagging indicator and TVL growth being more of a forward looking one.
The PWG will reserve the power to pursue product opportunities as they become apparent. While we plan on delivering on the projects as outlined earlier, the crypto space is a dynamic one, and we may find a golden opportunity that will take precedence on execution. We’ve had success with this approach in the fast, as successes like our partnership with Velodrome or implementation of CRV and cvxCRV markets in FiRM came from executing quickly on suddenly apparent opportunities.
The PWG will maintain its role as the “Gas Clerk” of cross L2 governance contracts. This privileged role only has the power to set parameters related to transaction execution, and cannot operate any underlying business logic. The PWG will request the authority to maintain servers hosting the Inverse Finance website, along with write access for its members to the public github code repository associated with Inverse Finance.
In Season 1 Contributors agreed to move to a standard compensation banding system. You can view the full compensation bands here.
Contributors will be active within XWG, to be paid as follows.
|Name||FTE||Band||Pro-rata Monthly Salary||Total for Season 1|
While initially on-boarded as a smart contract engineer, 0xMT has since taken on increasing amounts of responsibility, driving improvements to the internal security and product development process, along with taking part in protocol design and business strategy discussions. His expertise in both maintaining and further developing Inverse Finance smart contract systems along with his importance in driving the internal product development, makes him a crucial contributor.
Thealientourist has been with the Inverse Finance DAO for a long time, and is the backbone of all things user facing. His contributions make sure that our web front-end and back-end operates without a hitch, that we integrate with some third-parties (Zapper, Defillama, etc), and he lends his expertise to review of smart contract code and business logic as well. Without him, all user facing logic would grind to a halt.
Tabboz has recently been on-boarded to Inverse Finance’s product team to help the team go through their ever increasing backlog of desired features. He has deep experience with DeFi, having worked with multiple projects in the space. His uptake to the role has been quick, and he’s pushed both the majority of the Arbitrum AuraFed which will allow Inverse Finance to start building DOLA liquidity on the biggest L2 in the ecosystem, along with quickly pushing towards enabling a user experience enhancing generalized leverage feature.
|Details||Type||Requested $INV||Requested $DOLA|
|External expert review||Security||370||10000|
|Red team bounty||Security||20|
External expert review:
Part of the Inverse Finance DAO product development process is continued learning and improvement, and one of the key parts of that has been engaging with 3rd party smart contract development domain experts. Proposal 100 that founded the PWG, started this program and the spend has remained lower than the asked for allowance, primarily due to the excellent professionalism and efficiency of our external collaborator.
The agreed upon rate is $225/hour, paid 50% in DOLA and 50% in INV tokens. These are allowances and are unlikely to be fully used, as the initial allowance of Proposal 100 stretched much further than the initial 3 months proposed and has yet to be fully spent.
Red team bounty:
A new security initiative for season 1 is the institution of an internal red team competition. Team members will conduct mock attacks against key privileged roles and try to social engineer or trick other core members to perform potentially unsafe actions, but without the disastrous consequences a real attack may result in. Points will be given to team members who correctly identify mock attacks along with team members who successfully mislead other core contributors.
XWG requests a flexible budget as follows to cover unforeseen expenditure that arises during the Season
|Additional flexible budget in $DOLA||$40,000*|
|Additional flexible budget in $INV||0|
We have requested a flexible $DOLA budget of $40,000 primarily to cover either taking on Tabboz full time, or should negotiations fall through, the recruitment of an additional 0.5 FTE smart contract developer. This spend is not committed yet and can be used at the discretion of the PWG multisig.
In summary PWG requested the following budget for the 6 months of Season 1.
|S1 $DOLA allowance||S1 $INV allowance|
|Ad Hoc & Tooling||10000||390|