INK-35

Description

Rainbow Vault: The focus of this proposal is to create the ‘Rainbow Vault’ a lending fund to deploy capital for loans, created to serve the community of the Doodle holders while generating a steady passive income stream of revenue for the Inkubator. This would incentives holders to borrow against their Doodle unlocking liquidity while simultaneously reducing sell pressure of the NFT assets. Team Space: On approval Days until launch: 19 Requested Budget (USD): 50

Team:

-DT: Advisor/ Deployer (if need be) of loan fulfillment/ terms setting. Details: Current Head of Marketing at Arcade.xyz

• Lifts: Advisor/ Marketing & Comms support Details: Co/Founder doodliftsgym, & TGIDoodles - Ambassador Arcade.xyz

Questionnaire

What unique benefit(s) or experience(s) does this project provide for the holders of the originals Doodles collection? The Rainbow Vault would provide Doodle holders access to a source of liquidity without the need to sell their NFT asset, all while being able to participate fully in the Doodle ecosystem ((Tokenproof, delegate support, collabland, etc). This would reduce community sell pressure while increasing, sentiment, generating revenue for the ecosystem, & attracting new members.

How might this project affect the overall value of the original Doodles collection: Rainbow Vault’s value to the community is establishing a trusted lender (Doodles) to borrow against their otherwise illiquid asset as an alternative to selling which in turn would generate revenue for the Inkubator while reducing sell pressure & increasing brand sentiment.

The revenue potential for Rainbow Vault is very high relative to the effort to deploy. By utilizing Arcade.xyz (which currently has 0% fees for lenders or borrowers) the Inkubator would receive 100% of the revenue generated from the APR on the loans. LTVs, & APRs would be established with Arcade’s OTC desk to match market rates insuring the competitive APR is gained for the Inkubator.

Also while risk of default is lowered with proper LTV (terms) the potential for a loan to default would also result in the Doodle being turned over to the Inkubator which could be held by the treasury, auctioned off or even used as a supply holding for Inkubator proposals requesting Doodles.

How does this initiative relate to Doodles' brand identity and values? Every aspect of the Rainbow Vault will strictly adhere to Doodles' brand guidelines. All design and media work will be undertaken only post-approval to ensure complete alignment with Doodles aesthetics. Also with the proposal development (cost incurred by Arcade) for a Rainbow/ Doodle mode to skin the dApp to match the Doodles brand would be created.

This proposal carries the backing of prominent community members, including DecentralizedToast, and Doodlifts. Together, our collective experience in the DeFi space, especially in the lending/borrowing area, promises to ensure the Rainbow Vault’s success, seamlessly aligning with Doodles' mission and strategy.

What aspects of this project could appeal to the Doodles community? Doodles itself becoming a trusted lender would show the community it is focused on being a part of the web3 ecosystem while also helping reduce sell pressure of Doodle asset, which could improve sentiment around pricing for these assets. Similar proposals have been passed for large collections (Squiggles) that have show this to be the case.

If any, what are the projected financial outcomes of this project for Inkubator? The revenue potential for Rainbow Vault is very high relative to the effort to deploy. By utilizing Arcade.xyz (which currently has 0% fees for lenders or borrowers) the Inkubator would receive 100% of the revenue generated from the APR on the loans. LTVs, & APRs would be established with Arcade’s OTC desk to match market rates insuring the competitive APR is gained for the Inkubator.

Example: A loan at 1.2 ETH (75% LTV) at 20% APR for 30 days would generate .02 ETH in fees expanded across 75 loans would be generating 1.5 ETH per month with the potential to increase with rising floor prices.

Utilizing Arcade as a lender would also allow the Inkubator to receive any participation/ incentivization launched by Arcade in the future.

Can you describe the team's skills, past performance and credentials? DT is the current head of marketing of one of the largest (#1 peer to peer this month) lending & borrowing platform Arcade which has done over $125m in volume over the past 12 months. Prior to this he has been in the crypto ecosystem since 2014-15 & worked full time since 2018 in web3 with past companies being ShapeShift, Animoca owned nWay, & other small grey hat marketing web3 projects. Also has been a Doodle holder since Oct 2021.

Doodlifts has been a member of the doodles community for over a year. In that time he has been a major proponent of the community treasury, previously known as the doodlebank. Being part one of the only teams to successfully utilize the previous version as well as assist almost all of the successful teams in their campaign to pass quorum. In addition to that he has been a co-founder of TGID, a preeminent community news source within the doodles. Serving as an ambassador to http://Arcade.xyz and other companies, he has helped educate and onboard many community members to utilizing apps and protocols within web3.

Who are the target audiences for this project? This is for all Doodle holders looking to tap into the NFT finance market. It can range from holders with low (novice) defi backgrounds to the more advanced financial experts. Holders of Rares/ above price assets would be able to unlock liquidity based around real value of that asset vs current floor price. Target users would also be holders looking to get into the NFT finance space but do not want to lose the utility that comes with holding a doodle (gated events, etc).

Why is now the right time to fund this project? What does the spending plan look like? The NFT finance space is growing during the same time the price of Doodle assets has settled and remains relatively stable which makes these assets lower risk of default generating a steady stream of revenue for the Inkubator. Also Arcade has made numerous integrations into its smart vault systems that would allow holders who do take loans to also be able to participate in all of the token gated spaces (discord, IRL events, etc). The spending plan can be flexible as it would be reliant on the amount of volume potential borrowers were looking for. To assign a hard number to the proposal would be hard but a good starting point would be establish a minimum of 30-50WETH with a hard cap of 100WETH pending first results. Not all funds would need to be allocated all at once but allocated to a pool that could be used to deploy loan capital. Arcade has a dedicated BD term that could help with loan term setting, borrower connections & help advise on terms that would result in the lower risk side of returns for the inkubator.

Could you outline the plan for building awareness for this project once it is launched? Large social marketing activations. This would include Tweets (Xs) from DT, & Doodlifts which have followings within the doodles communities. Both are involved in numerous GCs that have large amount of Doodles holders. Explanation & Twitter spaces would be announced if passed to do a large round of QA. Social postings from the main Arcade twitter account which has started averaging 5-7k impressions for tweets. The ties that DT has into the NFT finance world/ chats would also be made aware of this deploy.

What is the projected timeline for the completion of this project? The project could deploy as soon as next week & run for as long as the inkubator see's revenue & good results. More proposals could be added to this increasing funding if it sees success (similar to the increases by Squiggle Dao & Moonbird Council)

Project Lead Additional Remarks

This proposal can be a little complicated to those not in the DeFi or NFT finance space. Follow up discussions/ calls/ explainers from the council & team would probable be recommended to answer any Qs.