Proposal 20: Re-define rewards for PIPT, YETI and CVP-ETH
DISCLAIMER: it is a draft for discussion. But, since the topic is urgent I want to move it to voting in 48 hrs, so let’s hurry up.
This proposal is aimed to make rewards allocation more efficient and limit CVP inflation.
Also, its necessity is also based on the fact that YETI rewards should be updated every month.
- Eliminate YETI-ETH Balancer rewards
- Decrease YETI staking rewards from 0.83 CVP/block to 0.5 CVP/block
- Move PIPT-ETH liquidity from Balancer to Sushiswap and keep the same rewards as now for PIPT-ETH
- Decrease PIPT staking rewards by 50% (from 1.09 to 0.545 CVP/block)
- Keep CVP-ETH Uniswap reward the same as before
YETI February rewards.
Eliminate rewards for YETI-ETH Balancer pool since YETI has ETH pair on Sushiswap, which is supported by the Sushi Onsen program.
Rationale: YETI is traded at Balancer (CVP incentivized pair) and on Sushi. Trading volume for YETI last 24 hrs: on Balancer was $42k and $29k on Sushi. It is completely not efficient to pay 132k CVP per month - $310,000 for such a pair? Obviously not.
Decrease YETI staking from 0.83 CVP/block to 0.5 CVP/block decreasing rewards by 40%
In total it will decrease CVP inflation by approximately 196k CVP per month or $461,000 future selling pressure based on current prices.
My opinion is that we should provide more rewards to the secondary market, and move the secondary market itself to Sushiswap. It will enable an option to swap PIPT<->YETI<->ASSY via smart routing. So:
- decrease rewards for PIPT staking by 50% (from 1.09 to 0.545). My opinion is that passive holding of an index shouldn’t be rewarded by almost 100% APY.
- More incentivized liquidity pair to Sushiswap
- Allocate the same reward as PIPT-ETH Balancer to Sushiswap
My suggestion is to keep rewards the same. CVP-ETH liquidity providers face serious IL right now and are the most loyal LPs in the community.