Author: Cleargate Research
Discussion: Discussion for upcoming Cleargate Community Spend Proposal regarding Cellar Development
The goal of this forum post is to discuss the upcoming Cleargate Community Spend proposal that will be posted to Governance on (Monday) 08/15/2022.
The proposal is for seed funding of the amount of 1M SOMM tokens to support the development of at least 8 new Cellars over the next year by Cleargate.
In this post, we would like to discuss the content of the proposal and provide opportunity for the community to provide feedback before the vote goes live.
Cleargate is about to become the second Strategy Provider on the Sommelier platform. As an independent strategy provider, we have been involved in the process of providing proposals and feedback about the design of the infrastructure (i.e., smart contracts) to run Cellars and development of the processes to on-board new strategy providers on the platform. Cleargate plans on developing the Sommelier ecosystem by developing, implementing, and operating profitable Cellar strategies.
SIPS Name : SIPS-013
Status: Not Yet Proposed
Author: Cleargate Research
Discussion: Proposal for Community Pool Funding of SOMM to Cleargate Research
Sommelier’s mission is to develop a platform on which Strategy Providers can make DeFi strategies available to all market participants in a decentralized way.
Sommelier creates Cellar infrastructure which is the pipeline for strategists to connect with market participants non-custodially. Strategy creation & execution is the lifeblood of Cellars. The service we provide is a core component of what Sommelier offers. In support of these efforts, we are requesting seed funding from the Sommelier community fund.
Cleargate’s mission is to develop profitable strategies on Sommelier and help to establish and strengthen the position of the platform as a leading decentralized strategy execution platform.
Grant of 1M (”one million”) SOMM to seed Cleargate Research as a strategy development partner with the goal of creating a diverse set of Cellars on the Sommelier protocol. This grant will support 12 months of Cellar development and maintenance.
Sommelier as a platform benefit from a diverse set of Cellars and Strategy Providers. We believe that seeding strategy development teams for the express purpose of developing Cellars on Sommelier is a useful bootstrapping measure in the early stages of Sommelier. Once the Sommelier ecosystem has matured, prospective Cellar development teams will be better positioned to raise funding externally.
Seeding Strategy Providers with SOMM tokens also contributes to aligning interest of the Strategy Provider and the platform as it incentivizes the Strategy Provider to contribute to the overall success of the Sommelier platform in addition to running its own strategies.
Cleargate Research is a financial strategy development firm focused on developing strategies for Sommelier platform and managing DeFi strategies. We are currently a team of 4 people, including 2 quants with background in quantitative finance and data science, an investment strategist, and a software engineer/architect. We bring along extensive knowledge from various financial markets with experience and a good track-record in short-term trading, derivatives markets and managing multi-asset class investments in the long run. We have experience in working with and for retail and institutional investors and running hedge fund strategies in accordance with regulations of financial authorities. Our current focus is on applying quantitative and data science methods on crypto markets and DeFi protocols to accommodate strategies and experience accumulated from traditional financial markets to DeFi.
We aim to continue strategy development and maintenance for future Sommelier cellars. This will require ongoing analysis, coding, testing, and execution. The strategies are not static but require constant adjustment dependent on market conditions and due to emergence of new DeFi primitives.
- Thoroughly backtest all strategies before execution
- Write up detailed reports / blog posts on strategies before proposing to Governance
- Ensure all contracts are audited before being made available to public
- Prioritize risk management of strategies, risk assessments and code refactors when deemed necessary
- Continued monitoring of Cellar performance and active ongoing management of Cellar strategies
- Continuous communication about performance and adjustments of Cellar strategies to the public through social media channels and/or dedicated Cellar info website
- Minimum of 8 Governance-approved Cellar Strategies for 1 year beginning from funds distribution
- Ongoing maintenance & delivery of strategies created by Cleargate to Sommelier validator set. Maintenance includes continued active management of live Cellars and updating strategies when necessary (e.g. when the strategy is no longer producing according to the target).
Total amount: 1M (”one million”) SOMM tokens
New Strategy Development
Funds will be used for the initial development of 8 Cellars / strategies, including:
- Strengthening of the team to include additional competences and manpower to extend the variety of Cellar offering and to facilitate smart contract development
- Salaries for team members for the start-up phase of the Cellars
- Maintenance costs associated with running analysis, backtesting and real-time monitoring and execution servers and software
- Testing strategies live before proposing to Governance
Ongoing Strategy Execution
Funds will be used primarily for costs associated with continued operations of live Cellars such as:
- Cloud infrastructure for deploying strategies
- Training and running machine learning models and live analysis and execution of strategies
Additionally, funding of SOMM tokens advances incentive alignment of the Strategy Provider team and the Sommelier platform to foster long-term cooperation.
In this post we outlined the upcoming Cleargate Community Spend Proposal regarding Cellar Development.
We would appreciate any feedback on how to ensure the proposal best reflects the interests of the Sommelier Protocol and Community.