Sharing some notes from Work Team Analysis pre-DG1. Note that this is a lighter analysis than is typically posted pre-DG2 as many details of the product are still being discussed!
Link: LAYER2_Product Scoring Chart_DG1 - Google Sheets
Overall Score (prelim): 1.82
Market Opportunity: 3
- This product earned a baseline point, a point for differentiation, and a point for nice-to-have product.
- It did not earn points for a large market: the team was unsure about the long-term outlook for the L2 market, given the innovation happening on many L1s and very recent launch (and therefore lack of historical data) of many of these L2s. We’d love to see more research on the size of opportunity if we proceed to DG2. We did note that a Layer 2 focused product received 2 votes in the recent product survey, but did not feel comfortable giving a point for that low of a vote number.
- It also did not earn a point for a must-have product due to the number of tokens that had to be excluded due to lack of underlying liquidity.
Revenue Structure: 4.17
- The split has not yet been discussed so this is a very preliminary score, though we felt that the proposed 2.95% streaming fee merited a high score.
- We did note that 2.95% is a much higher fee than IC has used before, and further research should be done to make sure it is viable in the market.
Methodologist Impact: 3.5
- The methodologist has displayed very sound product competency and the methodology has undergone rigorous review.
- Given the smaller social & industry footprint of L2Beat and Moonrock, the team was split on whether they earned a point for reputation. The methodologist did not earn a point for marketing support given their smaller profile compared to methodologists like Bankless.
Financial: 3
- The product will require IC to seed a liquidity pool, though is not anticipated to use incentives
Operational: 2
- The product will only require quarterly rebalances
Technical: 1
- This is a simple index that does not require new engineering work