Treasury Council Response: Conditional Financial Support for StellaSwap
Following StellaSwap’s request for financial support(StellaSwap Request for Financial Support for Restructuring) and subsequent discussions, the Moonbeam Treasury Council would like to share an update with the Community regarding the outcome of our review and the framework under which support may be provided.
Context
StellaSwap has been a long-standing decentralized exchange within the Moonbeam ecosystem and has played a meaningful role since the network’s early days. As outlined in their forum post, the team is currently facing a period of financial constraint driven by broader market conditions, reduced DeFi activity across the Polkadot ecosystem, and declining protocol revenues.
In response, StellaSwap approached the Treasury Council seeking temporary financial assistance to support a restructuring period and maintain core protocol operations.
Treasury Council Review Process
Over the past few months, the Treasury Council has engaged in multiple internal discussions and direct conversations with the StellaSwap team. This process included:
-Reviewing the protocol’s current operating cost structure
-Assessing recent cost-reduction efforts already undertaken by the team
-Evaluating the nature of the funding request (runway vs. growth)
-Identifying areas where increased transparency, sustainability, and long-term alignment could be improved
The Council’s objective throughout this process has been to balance short-term ecosystem continuity with responsible treasury management and long-term protocol health.
Summary of Proposed Support
Subject to the conditions outlined below, the Treasury Council proposes the following framework for conditional, temporary financial support:
-Funding Amount: USD $7,000 per month
-Duration: Three (3) months
-Total Commitment: USD $21,000
-Payment Denomination: MOVR
-Payment Structure: Single lump-sum payment, released upfront once all conditions are satisfied
This support is explicitly intended as bridge funding to provide limited operational runway during a restructuring phase. It is not a long-term commitment, nor does it imply any guarantee of future funding beyond the initial three-month period.
Key Conditions and Commitments
The provision of funds is contingent upon StellaSwap meeting a set of clearly defined conditions designed to increase transparency, improve sustainability, and clarify the protocol’s long-term direction. At a high level, these include:
1. Confidential Operational and Financial Disclosures
StellaSwap will provide the Treasury Council, on a confidential basis, supporting information related to:
-Core infrastructure operating costs
-Protocol revenue flows and receiving addresses
-Team composition, roles, and responsibilities
This information allows the Council to make informed decisions while respecting operational sensitivities.
2. Ongoing Transparency and Reporting
During the funding period, StellaSwap has committed to providing monthly updates to the Treasury Council covering:
-Changes in operating costs
-Protocol revenue trends
-Progress on restructuring efforts
3. Cost Optimization Collaboration
StellaSwap will work collaboratively with the Treasury Council to explore opportunities for further cost reductions, particularly in relation to collator operations and infrastructure expenses where potential optimizations have been identified.
In fact, much work has been done in this area already. Special thanks to @dev0_sik for collaboration with the stella team to optimize the configuration for Stella collators that underpin stGLMR.
4. Protocol Revenue Allocation Review
The Council has asked StellaSwap to evaluate the current allocation of protocol revenues, including the balance between funds retained by the protocol treasury and distributions to veSTELLA holders.
The goal of this review is to assess whether adjustments could improve long-term sustainability while maintaining appropriate incentives for participants.
5. Decentralization Roadmap and Long-Term Vision
StellaSwap has agreed to provide greater clarity on its intended long-term trajectory, including:
-The desired end-state of protocol governance and operations
-The anticipated role of the core team over time
-Whether the protocol is expected to evolve toward a minimally maintained or “unstoppable” state
-The current distribution of veSTELLA between the team and the broader community
Review and Next Steps
Toward the conclusion of the three-month funding period, the Treasury Council will conduct a formal review of StellaSwap’s progress against the conditions above. Based on this assessment, the Council will determine whether any additional support from the Moonbeam Treasury is appropriate. No automatic extension or renewal is implied.
Closing
The Treasury Council believes this approach reflects a balanced and responsible use of treasury resources: supporting a key piece of ecosystem infrastructure during a period of difficulty, while ensuring accountability, transparency, and a focus on long-term sustainability.
As always, we welcome constructive feedback and discussion from the community.
Michele Amurri on behalf of Treasury Council