[Proposal] Launch SDL Liquidity Bootstrapping Partnership with Delta One

Our Proposal

As a member of the Saddle DAO and core contributor to Delta One, I am submitting a proposal to improve the liquidity of SDL on Uniswap by crafting a robust, tailor-made liquidity management dashboard that executes LP strategies and distributes rewards to high-quality LPs.

Delta One is a liquidity management platform that offers data-driven and actionable insights for DAOs to cost-effectively create liquid markets for their token. Delta One is non-custodial, fully on-chain, and uses state-of-the-art analytics to keep the community informed.

Key Objectives

In this partnership, Delta One aims to accomplish the following objectives:

  1. Cut liquidity mining costs by moving towards data-driven models for incentive distribution.
  2. Reduce price impact on Uniswap SDL pools to encourage more users to enter positions and participate in the network.
  3. Take a first principles approach to quantifying the amount of liquidity needed in SDL pools based on market demands, and distill this information into comprehensible liquidity scores.

At the time of this proposal, SDL only has ~$4.5k in liquidity on Uniswap V3. A $100k swap from USDC to SDL has a 60.3% slippage, which severely prohibits new users and institutions from participating in the network.

A Novel Liquidity Incentive Engine

Delta One will conduct a deep-dive analysis on the current set of liquidity providers on SDL pools, creating a model for rating an LP based on a variety of factors: time in the pool, price range supported, liquidity depth, historical performance, stickiness during times of volatility, and more. Delta One will then build a novel and seamless liquidity management dashboard for Saddle to distribute incentives to high-grade LPs in a single click. We believe this tailor-made incentive engine can significantly cut costs by rewarding LPs based on specific performance metrics, rather than supporting ephemeral yield farmers. Similar to our Uniswap demo found here, Delta One will create a robust dashboard for Saddle, with an intuitive interface to execute each recommended liquidity action.

Bolstering Saddle’s Presence on Uniswap

Saddle’s presence on Uniswap is underwhelming for a protocol of its stature, and we unequivocally encourage the DAO to prioritize this venue. Delta One plans to tackle this problem using a two-pronged approach. The first prong relies on a comprehensive analysis to formulate target TVL numbers for relevant pools on Uniswap. This first principles approach will take into account historical sell volumes. The second prong relies on using the data-driven incentive engine outlined above to cost-effectively source LPs for the SDL-USDC pool.

About Delta One

Delta One is a decentralized market making protocol that specializes in set-and-forget liquidity provisioning strategies. We work with a number of leading institutions, trading firms, and protail DeFi users to keep crypto markets liquid and confident. Given our proximity with leading market making participants, Delta One’s network is immensely valuable to DAOs that are looking to take their liquidity management to the next level. One of the major contributors to the protocol is OpenBlock Labs, which is backed by notable figures in the crypto space, including: Foundation Capital, Electric Capital, Circle Ventures, AlleyCorp, and others.

Since its inception in 2021, Delta One has been working with a number of prominent DAOs and institutional players for liquidity management. It has also been audited by top-tier firms, including Halborn, OtterSec, and Neodyme.

The team has backgrounds from Stanford, a16z, Carnegie Mellon, Meta, Palantir, and other top-tier institutions; the highly technical background of our team makes us confident that Delta One is uniquely positioned to tackle a problem of this nature.


Phase 1: Liquidity assessment and analytics

  • Delta One prepares a dynamic and robust report with insights that pertain to the key objectives above.

Phase 2: Execute recommendations

  • Delta One creates a set of actionable strategies, and works with the DAO to safely and seamlessly execute the liquidity recommendations

Phase 3: Continuous optimizations

  • Delta One provides a customized dashboard to track the DAO’s liquidity positions, provide assessment across key metrics, and update recommended actions.

To cover the costs of our engineers, designers, and quantitative analysts, Delta One requests a 1.5M SDL grant for a 3-month partnership.

Final Thoughts

Delta One looks forward to working closely with the Saddle DAO to make its current treasury more productive, while bolstering the liquidity of SDL token across the Ethereum ecosystem.

Delta One believes that this grant would be a great first step towards solidifying a productive relationship for both communities. We look forward to hearing the community’s thoughts, and answering any questions.

Thank you for your consideration.