MGP-15: Mento Protocol Foundation Funding Request

Governance
1

TL;DR

The Mento Protocol Foundation is requesting up to $3.75M from the Mento Protocol Reserve over-collateralization, to be pulled on-demand to support the following:

  • Future expenses tied to orchestrating a successful token launch in Q2.

  • Ongoing development and operational costs tied to the upcoming Mento V3 deployment on Celo, Monad, and beyond.

  • External liabilities and Mento Protocol Foundation operational costs.

Motivation

The Mento ecosystem and the industry as a whole are at a pivotal point. We’re gearing up for a truly exciting release: Mento V3. It will be our largest release to date and our first cross-chain expansion to the Monad ecosystem. Mento Labs has committed to a March go-live date for V3 on both Celo and Monad (see: MGP-14: Mento V3 Deployment).

With Mento V3, the protocol transitions from a decentralized stable token issuance protocol to an on-chain FX powerhouse, with a specialized DEX based on FPMM pools (see whitepaper). The advent of more and more high-quality non-USD stablecoins such as BRLT (Trace Finance), EURAU (AllUnity), Qivalis, and Stablecorp, to name just a few, all sharing the same issues with classical AMMs, and more and more cross border payments corridors seeing volume on-chain, gives us a clear growth path.

Additionally, the Mento Reserve’s primary objective is to protect stable token holders’ funds and ensure the protocol’s longevity. Mento Labs has been in charge of those operations and has been moving out of volatile crypto assets as much as possible over the last year, ensuring we have strong overcollateralization at approximately 1.4x, resulting in ~$6.7M in overcollateralization.

With all this in mind, the Mento Protocol Foundation proposes an allocation of $3.75M to support:

  • Future expenses tied to orchestrating a successful Mento token launch in Q2.

  • Ongoing development and operational costs tied to the upcoming Mento V3 deployment on Celo, Monad, and beyond.

  • External liabilities and Foundation operational costs.

The Mento Protocol Foundation is confident this would be in the best interests of the protocol and Mento Token holders, as it would allow the Foundation to pursue the token launch from a position of strength.

Specification

Assets to be sold (in order of priority):

Priority Asset Notes
1 Glo Dollar (USDGLO) All holdings — excess stablecoin outside core backing strategy
2 EUROC Excess holdings — EUR-denominated, convert to USDC
3 ETH

All assets will be converted to USDC.

Reserve Impact

Metric Assessment
Assets affected Non-core holdings (USDGLO, excess EUROC, potentially ETH)
Amount USD 3.750.000
Core collateral Unaffected
Collateralization ratio Remains healthy

Per MGP-10’s tier framework, these assets fall outside the core Tier 0-2 allocation, making them suitable for reallocation.

Transaction Details

No on-chain transaction is required; this is an authorisation proposal for the Reserve Foundation.

Relevant Addresses

Entity Address
Mento Reserve reserve.mento.org
Mento Protocol Foundation 0x3468D23A0B1aB3Ab9A537813166A8f7ff1947014
Mento Labs Multisig 0x655133d8E90F8190ed5c1F0f3710F602800C0150

References

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