This proposal recommends the DAO to incubate a new DEX project named PurrSwap that will be natively deployed on the HyperEVM chain, by providing funding, technical resources, and strategic guidance. This initiative aligns with the DAO’s goals of fostering innovation and increasing treasury value through early-stage strategic partnerships.
The current proposal is to provide an initial investment of $500K in USDT from the Abracadabra Money DAO treasury into PurrSwap.
Purrswap will leverage Abracadabra’s existing MIMSwap technology to be the go-to AMM for stable assets in the HyperEVM ecosystem. Currently, the HyperLiquid Spot DEX is not optimal for swapping between stable assets, and with the influx of both different stablecoins and liquid staking tokens (LSTs) planning on launching on HyperEVM, there is a need for a stable swap in the ecosystem. Additionally, PurrSwap will target the growth of volatile pairs to serve as a comprehensive DEX within the ecosystem, which is something that the MIMSwap technology can also support. PurrSwap will also integrate a V3 AMM shortly after mainnet launch to support custom concentrated liquidity provisioning.
Strategic Rationale
MIMSwap Technology: This DEX will be utilizing MIMSwap’s technology, which will highlight the robustness of the DAO’s technology, boosting Abracadabra’s credibility.
Synergy: This DEX will offer a highly capital-efficient AMM for MIM liquidity and serve as a strategic partner for Abracadabra’s expansion to HyperEVM.
Diversification: Investing and incubating this DEX supports diversification of DAO-held assets and exposure to the HyperEVM ecosystem.
The details of the incubation and initial funding proposal are as follows:
Initial Incubation Funding Amount: $500k USDT.
Abracadabra Money DAO’s Token Allocation: PurrSwap will leverage a ve(3,3) tokenomics model. To align incentives, Abracadabra Money DAO’s stake will be the following:
2.75% of the initial circulating supply in the form of the liquid token, immediately available at TGE (Core Contributors do not have any liquid token allocation).
8.25% of the initial circulating supply in the form of the ve-token, auto-max locked (Core Contributors’ allocation will be 11% of the initial circulating supply in the form of the ve-token, auto-max locked).
There will also be incentives to align the existing Abracadabra community.
The idea of seizing this opportunity to develop the first MIMswap white-labeled product and launching it on an exciting chain like HyperEVM is really compelling.
I’d suggest bundling these points into the proposal:
Funding Purrswap from the treasury.
Licensing Purrswap as a friendly fork of MIMswap.
I really like the idea of the DAO receiving 11% of the token supply in exchange for licensing MIMswap. This aligns Abracadabra and the Purrswap team on making this collaboration a success. That said, I think the DAO should put forward additional proposals to decide how to use these tokens. A few ideas that come to mind:
• Distribute a portion to SPELL holders.
• Keep it in the treasury to boost MIM liquidity on Purrswap.
• Stake it to earn a share of Purrswap’s revenues.
The $500K funding request is definitely a big number, but it’s in line with previous investments the DAO has made in similar projects. For example, AIP 55 followed a similar approach. These kinds of moves help strengthen MIM’s liquidity by leveraging external protocols, and if the DAO incubates it, there’s a clear opportunity for economies of scale.
At the end of the day, SPELL holders will have the final say, but given that the DAO treasury has been steadily growing, I think allocating a portion to high-risk, high-reward opportunities like this makes a lot of sense. You can find an updated treasury reviewhere.
Before this moves to an AIP, I’d like to see:
Branding guidelines for Purrswap.
Confirmation that social media accounts and domains are secured.
We should also clarify the voting timeline, though that can be added later.
One final note: The Purrswap team has been discussing this idea with core contributors for quite some time, and it feels like a solid expansion opportunity worth putting to a vote for SPELL holders.
I greatly appreciate your feedback on this proposal and am glad to see that we share a common vision for this project. For additional context, the core PurrSwap team brings valuable experience from previously working on other DeFi protocols, which we believe will contribute to the success of this new protocol.
Social media accounts and domains are secured. Specifically, the X account for the project is @PurrSwap_, and the domain name is purrswap.finance, with the landing page coming soon.
We also plan to establish a Discord server as the primary hub for community engagement and meaningful discussions.
We believe this collaboration offers a unique opportunity to align the interests of both communities and drive mutual success. If there are any other aspects you’d like us to expand on before moving forward with an AIP, please let us know.
I saw at your twitter profile that KittenSwap is one of your followers. Is there any relationship between both projects (as you guys share the “cat” theme). It is also an DEX on Hyperliquid. How is the competition landscape and how PurrSwap will differentiate itself?
