Aqua Maker Incentive Program — 500,000 USDC Boost
Simple Summary
Allocates up to 500,000 USDC to a three-month maker incentive program on Aqua, stacked on the 10M 1INCH base campaigns funded by the 1inch Foundation on the same markets — paid for processed volume through Merkl, safeguarded, checkpointed, and returned if unspent.
Abstract
This proposal carries the DAO’s budget contribution to the Aqua launch. The launch framework itself — production deployment consent, the official interface authorization, and protocol fee activation — runs under the Aqua Launch Framework [Fast-Track] [1IP-103], posted in parallel. To complement the Launch Framework, 500,000 USDC will be added to the maker incentive program, stacked on top of the 1INCH-denominated base campaigns that the 1inch Foundation funds on the same markets.
Motivation
Aqua shifts competition from TVL acquisition to strategy innovation, but shared liquidity still needs seeding. Incentivized makers deepen strategy liquidity, deeper liquidity attracts taker volume through 1inch aggregation, volume generates protocol fees for the Treasury, and the Treasury directs those resources to further growth — the same flywheel logic the DAO endorsed in the Incubator proposal, now applied at the liquidity layer.
Specification
To bootstrap shared liquidity on Aqua at launch, the DAO allocates up to 500,000 USDC to a three-month maker incentive program. The USDC stream stacks on top of the 1INCH-denominated base campaigns funded by the 1inch Foundation on the same markets, following the DAO’s precedent for co-rewarded campaigns (1IP-92, 1IP-93):
-
Scope: rewards for makers on DAO-authorized Aqua deployments across a curated set of 1INCH-paired markets organized in token groups, weighted toward strategies routed by 1inch aggregation and excluding Incubator-graduate strategies, which carry their own revenue-share terms. Market-level parameters and group weights are set out in the published campaign configuration.
-
Distribution basis: rewards are paid pro-rata to the trading volume a maker’s positions handle in each epoch (processed volume), not to parked TVL, so the budget pays only where flow actually routes through Aqua. This is the same volume on which the protocol fees activated under the Aqua Launch Framework accrue to the Treasury.
-
Safeguards: address blacklists (router, resolvers, treasury and team addresses, sanctioned addresses), taker–maker exclusion, per-wallet caps, and wash-trading filters. Transfer-restricted or allowlist-gated assets are excluded — the program runs on open-venue markets only.
-
Administration & Disbursement: administered by Degensoft as program operator, consistent with its administration of the Foundation-funded base campaigns. DAO funds are disbursed from the DAO Treasury multisig as 500,000 aETHUSDC to
0x7c24E3049F46d59114908dB0C3eccd4695f7A8e4. Degensoft receives no compensation from this budget. -
Sequencing: the Foundation’s base campaigns launch with Aqua’s production release independently of this vote. The DAO’s USDC transfer begins only upon Snapshot approval and execution — no DAO funds are disbursed and no USDC rewards accrue for any period before approval — applying prospectively from activation, so the program launch is not delayed by the governance timeline.
-
Unspent funds: any undistributed budget returns automatically to the DAO Treasury at campaign end.
-
Reporting: Degensoft will publish a program report on the governance forum within 60 days of program end, covering distribution totals, volumes handled, safeguard actions taken, and confirmation of unspent-fund returns.
-
Framework confirmation: by approving this proposal, the DAO acknowledges and confirms the Aqua Launch Framework approved under [Fast-Track] [1IP-103], including the deployment consent, interface authorization, and fee activation set out there.
Incentive Structure
The program stacks two reward streams on the same markets: a 10M 1INCH base stream funded by the 1inch Foundation, and the DAO’s 500,000 USDC boost requested here, both following identical scoring and distribution rules.
The program spans up to 80 markets, each pairing 1INCH against a major asset, activating per network as Aqua deployments complete. Markets are organized into five token groups with initial shares of both streams:
| Token group | Initial share |
|---|---|
| ETH & liquid staking tokens | 35% |
| Stablecoins | 30% |
| BTC wrappers | 15% |
| DeFi majors | 15% |
| RWA | 5% |
Budgets pool at group level: rewards flow to the markets makers actually quote, so inactive markets consume no budget. Initial weights and the full market list live in the published campaign configuration and may be re-weighted between groups as the checkpoints and safeguards provide. Each group runs daily epochs, paying each maker pro-rata to the trading volume their positions handle, after safeguards — no reward accrues to parked TVL. Distribution runs through Merkl as six campaigns (five in 1INCH, one USDC umbrella); Merkl’s 1.5% fee applies, netting ~492,600 USDC distributable.
The budget releases 50/30/20 across three months, gated by adoption checkpoints at days 30 and 60 (thresholds published in the campaign configuration); underperforming groups have their weight cut to zero. Markets where reward rates would make self-trading profitable, or where wash filters flag material volume, are suspended, their budget re-flowing within the group.
Rationale
The incentive design pays for handled volume rather than parked TVL, so spend tracks actual usage, and it builds on the DAO’s own co-rewarded campaign precedent (1IP-92, 1IP-93). Because the launch framework activates protocol fees on the same volume, the incentive budget is partly self-funding: rewards pay only for processed volume, Aqua charges protocol fees on that volume, and the fees accrue to the DAO Treasury — the boost pre-funds the DAO’s own fee stream. At an illustrative blended take of 2 bps, roughly $2.5B of cumulative processed volume repays the full 500,000 USDC. The market set targets the venue gap: assets with deep global demand but thin on-chain venues, so incentivized depth competes for flow that today executes off-chain.
Considerations
Legal & Risk Management: this proposal falls within the risk-review triggers in Guidelines Section 5.6.2 (Treasury spending), and the independent review contemplated there is being completed before the temperature check. Rewards compensate makers for processed volume; they are not distributions to tokenholders, and none are proposed. Program parameters, market eligibility, and suspension rights remain governed by the published campaign configuration and DAO governance.
Conflict of Interest
This proposal is submitted by a Delegate, who received no compensation for authoring it. It was developed with technical input from the Degensoft team, disclosed here for transparency.
Degensoft Ltd (BVI)'s interests: it is the administrator of this incentive program, the developer of Aqua and SwapVM, and the operator of the official Aqua interface under the Aqua Launch Framework.
Mitigants: incentive funds flow to makers primarily through Merkl’s claim mechanism, under a published methodology; Degensoft takes no compensation from this budget; unspent funds return to the Treasury; the campaign address is dedicated and published; and Degensoft reports on the incentive program within 60 days of its end.
Summary
Allocate up to 500,000 USDC over three months, paid only for processed volume on 1INCH-paired Aqua markets, stacked on the Foundation’s 10M 1INCH base campaigns, released in checkpointed tranches, safeguarded, and returned if unspent. The launch framework holds the rights and the fees; this proposal adds the DAO’s fuel — makers get paid for the flow that turns the flywheel.