Project Background
Siren began in November 2020, with an initial product launch in March 2021. Siren (originally called Siren Markets) was the first options project created with the vision of creating options markets for any token in the EVM ecosystem.
The Siren platform has continuously evolved over time as decentralized technology has improved and the project codebase has matured. The first version of the project on Ethereum Mainnet suffered high gas fees and high latency due to network conditions but still reached a TVL high of $25MM, serving as a successful proof of concept for the premise of a Uniswap-like permissionless options product.
The subsequent version of the project, called Siren Lemuria, launched on Polygon on August 25, 2021. At the time, Polygon was the only viable EVM scaling solution, and the new platform benefited from faster transactions and lower gas fees. However, over time projects that used an AMM with unhedged liquidity pools demonstrated that exposed LPs lost money in the long run in a way that was not sustainable. It also became clear that Siren pricing models needed to become more flexible in order to compete with centralized products.
The current version of Siren, called Siren Flow, is the culmination of years of passionate development, incorporating all of the lessons from the previous versions. Siren is now on the cusp of realizing the original project vision: decentralized, self-custodial derivatives trading for all EVM assets, allowing for full expression of portfolio management in a self-custodial way.
Siren Flow testnet ran from May 24, 2023 to August 18, 2023 and generated $18,448,600 in notional volume on the Arbitrum Goerli testnet. Testnet demonstrated that the new strategies employed in Flow could successfully deliver hedged returns to LPs as well as competitive prices to traders.
Siren Flow has been running in private mainnet since December 2023 and as of February 15th, 2024 has 150 whitelisted traders generating $3M of notional trading volume.
Siren Project Token
The vision for Siren is to become the premier way for traders to access the financial products they need to completely express their vision for token portfolio management, thereby becoming a critical piece of the financial system of the future. To further that goal, this proposal aims to launch a new token for the Siren project, thereby restructuring governance and tokenomics in order to ensure alignment within long-term token holders, instill confidence in the long-term success of the project, and maximize growth and success.
We propose the following change:
- Launch a new token with the ticker $SIREN with a supply of 1B, which will be created on ETH mainnet and bridged to the Arbitrum network. The new token will govern the Siren protocol, and $SI holders will be able to migrate to $SIREN. New $SIREN tokenomics will be discussed in a subsequent proposal.
The $SI token was created with a supply of 100MM in March of 2021 as a means to govern the Siren protocol. Since the first version of the project the mandate of Siren has expanded considerably from simple put and call buying to being the home for all DeFi derivatives portfolio management. The public launch of Siren Flow is an opportunity to ensure the expanded vision for the protocol and products is fully supported by tokenomics and the governance process.
In the three years since the initial launch of Siren, the state of DeFi has changed significantly. DeFi has become more accessible, and new users have entered the market. Networks such as Arbitrum, Optimism, Avalanche, and more have launched and grown communities, bringing even more people into the space. A new Siren token is also an opportunity to bring new users into the Siren community.
Conclusion
The launch of Siren Flow celebrates a new era in the history of the project. The team has delivered a product that solves the issues surrounding on-chain derivatives trading, including pricing for thinly-traded assets, liquidity provider protection, competitive pricing with order-book-based and centralized products, and the capital efficiency of a shared margin system. We believe that Siren can become the home for all on-chain derivatives portfolio management and trading.
A new Siren token will attract new users, reinvigorate excitement amongst existing users, realign long-term incentives with the governance structure of the project, and bring the opportunity for new token functionality.
Next Steps
By voting yes to this proposal you support the creation of a new token $SIREN for the Siren project and open the discussion on $SIREN tokenomics, including conversion mechanisms for the $SI token. We will leave this up for discussion in Discord and put it up for a snapshot vote once the proposal has been discussed sufficiently.