Karpatkey H1 2023 Review for the ENS Endowment

With the selection of the joint proposal presented by @karpatkey and @steakhouse, the ENS Endowment was officially established in March 2023, after the successful execution of E.P 3.4 - Fund the Endowment (first tranche). As we journey further into 2023, we’re eager to share a succinct recap of our collaborative journey with the ENS DAO thus far as well as the upcoming initiatives.

Before delving into the details, here is a visual summary of the events from the Endowment’s RFP to the present:

Endowment Update

Based on the most recent monthly report detailing the Endowment’s performance for July 2023, the Endowment has achieved:

  • $29.8M of ncAUM (non-custodial assets under management)
  • 88.8% of capital utilisation
  • An APY (annual percentage yield) of 3.37%
  • Monthly farming results of $82,265

These figures will be updated with the forthcoming release of the August 2023 report.

On the other hand, as of the day of this writing, the distribution of funds by investment categories can be seen in the following graph:

Subsequent to the execution of E.P 4.1, we introduced new strategies into the Endowment. As of the day of this writing, the allocation of funds by investment position can be seen in the following graph:

Upcoming Initiatives

  • In September, we will initiate the Endowment’s second tranche by proposing a new transfer of 16,000 ETH. This aligns with our two-phase funding plan that allocates 50% initially and the remaining 50% six months later.

Strategy & Implementation

  • We harnessed the Zodiac Module, specifically the Roles Modifier, to ensure a trust-minimised, non-custodial management of the Endowment. Our steps included:
    • Launching a new Safe (Avatar), applying the preset containing the permissions granted by the ENS DAO to another new Safe (Manager) owned by karpatkey as per the Endowment initiation plan.
    • Conducting rigorous testing of the preset and offering comprehensive documentation to the ENS DAO detailing specific permissions granted to karpatkey.
    • Post audit, the ownership of the Safe (Avatar) was transferred to the ENS DAO, now officially termed as the Endowment (endowment.ensdao.eth).
  • Upon the green light for E.P 3.4, a transfer of 16,000 ETH was made from the ENS DAO to the Endowment. Subsequently, we executed the strategy according to the plan:
    • Converted the earned-ETH segment (around 7,000 ETH) into stablecoins (USDC and DAI) in seven tranches of 1,000 ETH each over several weeks. These funds were then channelled into USD-neutral strategies, targeting positive results measured against USD.
    • The remaining ETH (approximately 9,000 ETH) was directed towards ETH-neutral strategies, aiming at positive results measured against ETH.
  • Post strategy deployment, we diligently monitored positions, claimed rewards, and reinvested for compounding benefits.
  • E.P 4.1 was introduced to refine the Endowment’s adaptability, performance, and diversification. With its approval, we fine-tuned our strategy to align with market dynamics and seize new opportunities.

Future Roadmap

  • Enhance the preset update auditing process. We aim to offer a more intuitive visualisation of potential Zodiac preset changes before executing a proposed payload.
  • Broaden the spectrum of LSTs (liquid staked tokens) within the Endowment in order to advocate for validator diversity, integrating more protocols and strategies that resonate with the Endowment’s risk appetite and long-term vision.
  • Remain vigilant of market trends and explore new avenues for the Endowment, with a keen interest in RWA (real world assets) in the coming months. @steakhouse provided an in-depth analysis and overview of the current state of RWA on the forum.

Risk Management

  • Crafted a meticulous risk map tailored for the Endowment, pinpointing specific risk parameters and outlining both preventive and mitigative measures.
  • Collaborating with expert providers, we established a vigilant alert system to oversee our investment positions and the broader market. This system is primed to identify irregularities or significant events that could require the initiation of emergency protocols.
  • Conducted war-room sessions to evaluate potential risks and devise appropriate responses to unforeseen events, such as the USDC depeg, the Curve exploit stemming from the Vyper compiler glitch and the recent vulnerability detected in certain Balancer v2 pools.

Upcoming Initiatives

  • Bolster the resilience of our risk management framework by:
    • Introducing new Zodiac Roles, including the disassembler bot, designed to autonomously pull liquidity from any position if certain criteria are triggered.
    • Augmenting the automation capabilities of our emergency protocols.
    • Expanding and refining our alert system through the integration of innovative metrics and machine learning algorithms.


Future Reporting Endeavours

  • Elevate the user experience of our reports and incorporate more bespoke metrics.
  • Unveil a real-time iteration of our web-based report.


  • We’ve consistently engaged in the weekly MetaGov discussions, maintaining a 100% attendance record since the inception of the Endowment. This dedication ensures we remain aligned with community aspirations and seamlessly incorporate invaluable feedback.
  • Introduced the ENS DAO Governance dashboard on Dune Analytics, providing a comprehensive insight into governance activities, delegate profiles, voting power distributions, and other crucial metrics. The dashboard is instrumental in evaluating governance transparency and fairness.
  • Participated in the Q2 ENS Town Hall.

Community Roadmap

  • We’re dedicated to maintaining active community engagement, offering our expertise and insights for the collective benefit.
  • We remain vigilant, always on the lookout for opportunities to enrich the ENS community and amplify its value.

Thank you for placing your trust in us with this pivotal role. We’re eager to sustain our contributions and dedication, ensuring the enduring prosperity of the ENS DAO.


Thank you for your work + for being thoughtful stewards of the Endowment, @karpatkey team!

PSA here that the @karpatkey team shows up to the weekly Meta-Gov calls to discuss the latest updates + answers all open questions/ comments/feedback. The forum is always a great place for async questions, but those calls are best for direct discussion!