Stake DAO Q2 Report — 2022

Stake DAO
9 min readAug 11, 2022


  • TL;DR (Introduction + H2 2022 Roadmap)
  • Total Value Across the Verticals
  • Total TVL
  • Liquid Lockers
  • Liquid Lockers Use Cases
  • Options Vaults
  • Passive Strategies
  • P&L
  • veSDT
  • Treasury
  • Trading analysis
  • Trading performance
  • Liquidity overview

Data Sources

The data in this Quarterly Report is taken from our own internal analysis and on-chain data, as well as from external sources such as The Block, Token Terminal, and Dune Analytics.


H1 Highlights:

  • Stake DAO TVL as of the end of June 2022 across the entire Platform is at $200M, marking a 50% decrease in comparison to 2022 Q1. This decrease is in line with the decrease in TVL in the DeFi industry, which exceeds 60% according to DeFillama, going from $229B to $80B. The main decrease in the Stake DAO TVL was caused by the ending of the AVAX delegation from the Avalanche foundation.
  • Cumulative Protocol Earnings are nearly $12M since inception in January 2021 with today’s asset market prices.
  • The Liquid Lockers have been showing an excellent rate of adoption, and multiple DAOs have already chosen to adopt the newly designed infrastructure to boost their voting power and yield across the platforms currently on offer (CRV, FXS, ANGLE, BAL).

H2 Roadmap:

Some of the planned improvements for Stake DAO in H2 2022:

  • Release a new User Interface which will integrate the Stake DAO V2 products and Liquid Lockers into one webpage.
  • Add new Liquid Lockers, such as Qi DAO, AP Wine and more to come.
  • Release the new SDT inflation framework.
  • Strengthen the Derivatives Vertical with a newly designed platform, new strategies exploiting DeFi economics (Hedging Vaults, L2 Strategies, Exotic products).
  • Rationalise the validator business.
  • Ship the final version of Liquid Lockers for the liquid staking of governance tokens (CRV, FXS, ANGLE, BAL).

The following chart shows a comprehensive breakdown of all the features of the finished Liquid Lockers:

Our KPIs for the next half of 2022:

  • Strategies TVL: $100M
  • Lockers TVL: $50M
  • Derivatives TVL: $50M

Total Value Locked across the verticals

Stake DAO TVL has experienced great volatility in the last 2 quarters, mainly due to market conditions, fluctuating around the $200–400M range for the last 3 months.

At the end of June, Stake DAO TVL presented the following breakdown:

  • TVL in V2 Strategies: $104M (-58% vs end of Q1)
  • TVL in Protocols: $25M (-86% vs end of Q1)
  • TVL in Options: $21M (-66% vs end of Q1)
  • TVL in Liquid Lockers: $30M (+500% growth in the last 2 months alone)

Liquid Lockers:

We launched the Liquid Lockers in April 2022 with the FXS and ANGLE lockers.

The ANGLE Locker has been a great success with more than 40% of the veANGLE supply deposited in the Locker. Thanks to that, we can offer the maximum boost on ANGLE rewards through our ANGLE strategies which currently have $12m TVL. Regarding the FXS locker, we are still working on the FRAX strategies, and plan to deploy during Q3.

These Lockers were followed by the CRV locker, which has already reached more than 15m CRV locked into veCRV. This Locker tripled the Stake DAO veCRV holdings, whereas the Passive Perpetual Strategy only reached 3m CRV locked at its peak. This result proves that creating the Liquid Locker product was an excellent decision for Stake DAO. On the strategies side, we also have a TVL of $12m in the Curve Liquid Locker strategies generating fees for the sdCRV holders thanks to the maximum boost we can offer on CRV deposits.

Our newest Locker is for Balancer (BAL), where we have seen steady growth in the amount of veBAL locked. The total TVL in Balancer strategies is already nearly $8m, almost competing with that of our Curve and Angle lockers.

Liquid Lockers Use Cases:

In order to attract liquidity, DAOs regularly use bribing mechanisms to attract CRV emissions to their token’s Curve pools. This was the case with Alchemix, who, thanks to the Liquid Lockers, are spending only a third of what they were previously having to spend on bribes.

Alchemix was keen to improve the cost-efficiency of directing emissions to their Curve pools. Despite spending heavily on bribes, CRV rewards on their alUSD and alETH pools had been falling steadily from their late 2021 peak.

With the launch of Stake DAO’s CRV Liquid Locker, Alchemix took their chance to get back in the game. This allowed them to participate in Curve vote-locking via the Liquid sdCRV wrapper without the need for whitelisting. Alchemix was able to take advantage of this “whitelist-as-a-service” by using their own funds in Stake DAO to secure a more efficient result than navigating the bribes market.

Since May 13th, and their 3m sdCRV and 964k veSDT ($3.8m) investment, Alchemix has issued around 50m votes in veCRV with their sdCRV, which would have cost them approximately $500,000 in bribes.

On top of this, they farmed $100k of rewards in 3CRV, CRV and SDT. This means that their investment already enabled Alchemix to save $600k in less than three months.

This is proving to be a profitable long-term investment for Alchemix as they will be able to continue voting for their pools with their sdCRV without having to pay bribes every week.

Bribes for sdCRV holders:

Since the launch of the Liquid Lockers, sdCRV, sdFXS, and sdBAL holders have received a total of 736,247 SDT (c.$500,00 at current value) bought from the market from bribes collected in each respective bribes market.

Thanks to our bribes optimization, we achieved a 0.013$ / veCRV rate for sdCRV on average since late May 2022.

Users are able to benefit from this high $/veCRV rate with next to no effort, as we set up a delegation mechanism to allow users to benefit from the optimization without any action on their part after delegating their vote to Stake DAO.

Options Vaults:

The TVL on our option strategies has been decreasing in Q2, ranging between $20–40M in total TVL. We are currently selling around $500k premiums per month among our three options vaults.

We plan to deploy a brand new derivative platform during Q3 to highlight our market-leading options vaults. We are currently offering covered short vaults (i.e. selling calls and puts every week) and we plan to add various other strategies such as long vaults and spread vaults as well as deploying onto other chains.

Thanks to our quant desk and our auction mechanism, we can sell our options at a better price than the market, resulting in a better APY than the competition. The recent market conditions had a negative impact on the put selling strategy, resulting in a -17.59% APY since inception, however the total loss was lowered by the working collateral on the FRAX3CRV curve pool.

In early July we migrated our ETH Covered Call vault to a new version that facilitates deposits and withdrawals, removes the withdrawal fee, and pays rewards ETH. We also plan to migrate the BTC Covered Call and the ETH Put Selling strategy during Q3 to this new vault structure.

Passive strategies on Stake DAO V2:

The total TVL in Passive Strategies on Stake DAO V2 has remained steady at the $100M mark over the last 2 months, decreasing around 58% from the high at the end of Q1 2022.

The reduction in TVL has followed the average reduction seen by all major DeFi protocols during this time.


Stake DAO Total Revenues have been shrinking in the last Quarter due to lower TVL across V2 Strategies and Validators. However, last quarter, Stake DAO produced around 650k monthly.

Costs have also increased alongside the DAO’s operations. The main cost items can be found below:

  • Gas Costs: These are accounted for under the Strategies Vertical. These decreased in the last quarter due to a reduction in Ethereum network Gas costs.
  • Dev-ops costs and taxes: They are recorded under the Protocols vertical and take into consideration all the costs linked to running and maintaining validators and servers. This cost item has been increasing due to the introduction of a new chain’s validator.
  • Core Team Rewards: contributor rewards have been increasing in the last quarter due to an increase in the Stake DAO contributor headcount.

Below is the breakdown of costs for the period starting January 2022.

Net Earnings have decreased during the last quarter due to internal reasons (Increase in contributor headcount), and external reasons (Decrease in digital assets pricing, total TVL in the Stake DAO Protocol). Despite the decline in market conditions, Stake DAO is proving to be very resilient, still managing to produce $350k/ month for the last quarter.

The consistent profitability of the last year has pushed our cumulative earnings to over $12M. The 30D-rolling annualized earnings stood at $3.5m in March, making Stake DAO extremely secure even in the worst case bear market scenarios.


As of June 30th, 13M SDT are locked in Stake DAO, representing around 35% of the Circulating Supply and 13% of the Total Supply. There are still 4.4M SDT in the Sanctuary earning 0% APY, despite our encouragement for users to move to the SDT locker if they want to earn yield from their veSDT holdings.

NFT Financialization

We had to pause the Premium Arbitrage strategy during Q2 due to market conditions, when the arbitrage strategy ceased to be profitable. Since then, we have been looking for new revenue streams so we are able to resume the strategy as soon as possible. We have identified several opportunities and we have created the smart contracts in order to take advantage of them. We are now carefully reviewing these contracts, as we want to be sure that the strategies will be profitable in the long term before announcing their release.


The value of the Stake DAO Treasury has grown steadily and sustainably over the last quarter, due to the increase in cumulative earnings from Strategies and Staking-as-a-service.

The Treasury is divided into three main wallets:

The treasury is composed of different assets with the following breakdown, for a total value of over $17M:

  • Tokens in wallet: $769,972
  • Deposits: $425,957
  • Debt: $0
  • Other Assets (LPs and sd tokens): $4,756,264

The “Stablecoins Managed” category refers to the Stablecoin portion which is actively managed by our Treasury Management team. At the moment we have allocated $1.65M, yielding 11.16% APY with the following breakdown:

Market trading analysis

Like most market participants, we were hit heavily by the spring crash.

However, from the lowest SDT price of $0.17 in early June, we have recovered well, to our current price around $0.60.

We attribute this steady growth to the full deployment of the Liquid Lockers, mainly the CRV Locker, which collects a good amount of bribes that we are distributing to sdCRV holders using SDT bought from the market.

On the liquidity side, there was little change during Q2. We have a total liquidity of almost $2m on Ethereum, which is mainly in Curve. Stake DAO owns 20% of this liquidity and has staked it in the SDT/ETH Curve Liquid Locker strategy, where it is earning ~20% APR.

Stake DAO also owns $50k liquidity on Polygon and $350k liquidity on Avalanche.

Thank you for reading.

We welcome any questions you may have after reading this report.

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