Author: Danny Thomx / Technology and Innovation Steward Role
Created: December 16, 2025

Executive Summary

This proposal initiates "Season 2" of the ApeBond x ICHI liquidity strategy. Following the review of the "First Season" performance (Sep 2024 – Dec 2025), the DAO is choosing to double down on our automated liquidity position rather than unwind it.

We propose transferring approximately $16,000 USD worth of $UP tokens from the DAO Treasury to the DAO's SAFE multisig on Base and beginning research on a follow-up proposal template to withdraw ~$10 worth of WETH from the vault back to the DAO Treasury. This action is intended to reduce price impact (slippage) from the current ~5% to a target of 2–3%, further stabilizing token liquidity, creating a safer environment for new Liquidity Providers (LPs) to enter, and going full circle on the automated liquidity strategy.

Motivation & Background

In September 2024, Unlock DAO partnered with ApeBond and ICHI Finance to establish sustainable, protocol-owned liquidity. The "First Season" concluded with a review call on December 10, 2025.

The Current State

• The ICHI Vault is currently the source of the deepest liquidity for $UP on Base.
• The vault utilizes automated liquidity management on Uniswap V3.
• However, the current depth is insufficient for larger trades, resulting in a ~5% price impact (slippage). Buying $UP is currently more difficult than selling due to this illiquidity, which discourages new participants.

The Decision

After the review, a hybrid approach is presented by the Council of Stewards:

1. Add Liquidity: Inject more $UP (~$16k) to deepen the pool and lower slippage.
2. Research Retrieving Liquidity: Research the process and template for a later DAO proposal to retrieve a small amount of WETH (~$10) from the vault back to the DAO Treasury (going full circle on exploring the initiative).

Implementation

On-chain, this proposal performs a single transfer of $UP from the DAO Timelock (Treasury) to the DAO’s SAFE multisig on Base. From there, DAO stewards can connect to ICHI and deposit into the ICHI Vault via the ICHI interface.

• Asset: $UP Token (Base)
• Source (Treasury / Timelock): Unlock DAO Timelock
• Destination (DAO Multisig): 0xf88e5D0A879a709d0B1cB794d5E0b8c61783cA10
• Value: ≈ $16,000 USD
• Token Amount: 7,366,400 $UP (@ $0.002172 per $UP)

Rationale

• Reduced Slippage: Targeting a reduction of price impact on trades to ~2–3%.
• Community Trust: Deepening protocol-aligned liquidity and signaling long-term commitment.
• Attracting New LPs: A deeper, more stable pool makes it safer and more attractive for new LPs to join.

Supporting Documents

• ApeBond x ICHI Vaults — Season 1 Review: https://docs.google.com/document/d/1fTTxYr95ckomjOLqEz-UFNCQwtBROxoG8b5NbBm55iI/edit?tab=t.0#heading=h.cn6wrslzm8e4
• Vault Metrics Dashboard: https://vaultmetrics.io/?vault_address=0xF349Fa49651d5ae67771B61840c4CCC7a2565764&chain_id=8453&days=180