Being native to Ethereum mainnet presents the DAO with some notable blockers - volatile gas fees mean that retail investors can be priced out of using our products and we miss out on the opportunity to market to L2 communities.
The next 12 months will likely see the L2 space continue to grow in terms of usage and capital deployed, and with this in mind it seems wise for PieDAO to catch this multi-chain wave early and place ourselves in a good position to capture that value as opposed to trying to break into these markets later on when the players are much more established.
Motivation + Scope Motivation:
There is a significant and persistent demand for products on L2s that is only expected to grow exponentially in the coming months. As of the time of writing, we are in a position to frontrun a lot of the competition in this space - as time goes on market demand will be diluted and it will become increasingly hard to break into L2 markets, first move advantage is very much a real factor.
L2 deployment of PieDAO products
By deploying on L2s we seek exposure to L2 market capital, and also negate the blocker of high gas fees that can put off investors in our products. We can also take advantage of cross-marketing initiatives, and potentially integrate the L2 venture with our other cross-chain initiatives, namely Auxo.
Technical risks are present, with every new project comes new risks of hacks and bugs both from our side and from the chain on which we plan to deploy. Also to consider is the possibility that we deploy without incident and then fail to capture market share for whatever reason.
An airdrop is expected from Arbitrum at some point in q3 - with incentives likely distributed to both retail users and projects deployed on the chain. Arbitrum also offer good marketing support, hosting AMAs on twitter spaces + discord community calls for new projects (500-1000 average listeners) in addition to the usual twitter retweets and the Arbitrum One page.
How would this look on the tech side? Is this an easy ship or a long process?
Will liquidity have to be sourced via bridging (wDEFI) or potentially using synthetic assets?
Temp check for L2 deployment
Decide what product to deploy on new chain: existing product or new?
Thanks for bringing this up. Try following the template we have for those post that aim to gauge sentiment so we can clairfy your throughs about other important topics as Benefits and Risks, and Next Steps.
I will say for sure that when I first joined the DAO, gas fees were my main deterrent from engaging with the wider product range.
I don’t think it is at all trivial to migrate from L1 to an L2, with existing customers and a reduced selection of protocols, but I do think we stand to make real gains in market share if we are able to deploy at least one index on an L2.
Suspect this will be a new product, or might involve building on the Auxo infrastructure which is natively an L2 product spanning multiple chains.
Saying all that I can anticipate the hesitations from key decision makers in the DAO and it will 100% be practicality. As Adrian says, we need a more concrete definition of exactly where we might start.
DEFI++ and BCP cannot be moved independently, because they are linked.
DEFI++ is about to revamp, so would be a strange one to move.
PLAY is in a bit of a strange spot, given the NFT/Metaverse collapse over the past few months.
We had discussions about an $LTWO index, which I would be very interested in seeing move further along.
I’m in alignment with this. The big appeal with PieDAO initially was the reduction in transactions needed to gain exposure. I think there is still a similar benefit to be gained on L2’s even if fees are typically lower. I personally am biased in believing that ETHmain will remain a high interest which offers the biggest gain to users out of PieDAO.
However, if we have the capability to extend those benefits to L2 I think it is worth investigating. Arbitrum and Optimism are the two that come to my mind but as mentioned I haven’t interacted with L2’s much so would defer to those with more experience. We definitely need to select a starting point and try a controlled roll out.
I am all for listing on Arbitrum. Seems like this is in line with our Mission Statement of bringing financial assests to those who may not have access otherwise. Arbitrum and Optimism are two of the best imo.