Make it clear that it’s a return of part of the penalty not a refund
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I’m not sure people already agreed on how to scale the “refund”. Maybe everyone could post how they would like to see the numbers (e.g. 18-25%)? Then we could “vote” by using the “like” system.
Concerning the 100k sICX for the borrowers, there was no clear plan yet how to distribute. Only that there would be a chosen block to check the height of the loan and divide the reward pro rata. Maybe we could take the latest block in the period for that? Another option would be to take the average of everyone’s loan over the full period (20-24) and then base the reward on that.
Edit: apparently you can create a poll. Great UI this forum.
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Which levels should we scale between?
- 0-25%
- 5-25%
- 10-25%
- 15-25%
- 20-25%
- Flat 25%
0 voters
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This is great seeing the community pull together!
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I regected the proposals because it seemed a bit of a blanket proposal with some jumping on the band wagon to get something out of it that they are not really entitled to. A scaled adjustment where the payment is directly relative to original risk level would be an excellent idea. If there was some way to factor in people who made additional payments to avoid liquidation that would great too.
I think if the goodwill payments are data driven to reflect who suffered due to the rebalancing as opposed to having taken on too much risk then it would win many more votes.
I know we want to keep it a simple vote but in this occasion more complex calculation of what’s paid back would make more sense to me.
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Hey @Chiel - I think I have this data and have the csv file I can send you. It won’t let me attach it here. The file contains 174 liquidation events starting at block 45,100,000, with the last liquidation happening on block 45,185,262. However, if anybody would like to verify the data please do. This is data is publicly available.
Also, back in October, I referenced the amount of sICX in the Emergency Reserve fund, so we can figure out how much sICX was actually sent to the ER assuming no liquidations happened between then and now.
Currently, it’s holding 2,268,364.66 sICX. That’s a difference of 1,525,463.66 sICX. A community dev also pulled all sICX transfers to the Emergency Reserve Fund during the same period as the liquidations and the number lines up. I can also send that CSV file to you.
As for the scaling side of things, I don’t have a strong opinion. I’d steer away from scaling solutions that have too low of a start (0% and 5%), as you might scare away votes from people that don’t fully understand or feel they’ll definitely get a bad return on the scaled proposal.
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I miss the 18-33% option 
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This strays away too far from 1/4
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We started with 1/3, then 1/4, now scaled return. Less and less. I have thought all the way that the problem is not necessarily the original proposals except for including BALN. The problem is the uniformed community. While many people understand what went on during the great liq, there are still many who don’t understand why a liq should get a refund. We can rename it from refund to return and also try and inform the BALN stakers why some users deserve to get their assets returned. I see many of them saying on social media that they put on too much risk when that’s obviously a very simple way of looking at it. Again, the original proposal of a 1/3 return is not the problem. The problem is people who haven’t reserched properly before they vote. How do we inform the people outside of this thread? Maybe Balanced could be more open on Twitter about what went on as people listen to what they say.
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If you put out an educational tweet that’s completely unbiased, purely educational, and accurate, perhaps the Balanced twitter would retweet it.
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100% Agree with you pal
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I think we need to involve more BALN stakers to this conversation to hear their opinion, as to what they would vote for, any idea on how to do that?
How many of us were yield farming when we got rebalanced? Most of us, we thought we were at a safe level, but this is DEFI.
This is why I mentioned earlier it may be more prudent to seek advice, ask for 1/5 back since 1/4 was rejected.
I want everyone to have a resolution but with a resolution we must compromise, BALN stakers are down more than the 33 percent we are asking for in this refund over the past month. No one is financially in a better position, the liquidated or the BALN Holder.
We may need to move on if the next vote gets rejected, as this will become weary for everyone.
I know the community is working hard to iron out the details of the vote, so it stands the best chance of passing, but personally, I think we should try and put it up before the new rebalancing threshold vote passes. We’ve got about 3 days. At that time Ill be paying off my loan, selling my BALN and moving back to the safety of my staking wallet.
Ya i just wish something would pass regardless of what it is. Better then nothing passing. Easier said then done though.
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Yea would be great if we can get a proposal going asap. But I do like to have it data driven and based on statistics.
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To do the votes on the poll the most justice I think we should go for a weighted average of the votes. Currently (basing the weight on the percentages) the scaling would come to 18-25% (rounded down from 18,3%).
I deliberately chose 25% as a cap to stick to the original proposal and to keep it simple. It also allowed to do a stepwise approach. While I completely agree there are other opinions, I thought this was the best way to get the message through.
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I agree that it’s time to get a little more concrete. The majority of the votes in @kev’s poll seem to prefer a flat 25%. However, some thoughts on this:
- Most active members in this discussion are liquidated borrowers or already relatively pro-refund. I think we should consider the input from @Jahpete and @Collapseby2050 that there might be a decent group of users that wants some sort of scaling solution to get approval.
- @kev calculated that the weighted average of the votes on his poll result in 18-25%. This is an alternative approach to analyse the results of the poll.
To make the discussion about percentages easier I made a spreadsheet script that calculates the returned sICX for every applied scale. Feel free to look around and (anonymously) change the input values. You can also make a copy from the sheet and look around.
Important: This sheet is just my personal work/experiment created from a provided list with on-chain data. I reviewed my work but I cannot guarantee that there are no mistakes. Furthermore, there are different methods/datapoints that a linear scale can be applied to, so it is possible that even with the exact same scale eventual refunds will be different, but it will probably giva a good indication.
I will draft a proposal now so we have something more concrete to discuss.
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I agree that although 25% won that chart that the linear proposal seems fruitful!
As Benny said before, proposals can be made so it can be tweaked until it hits 66.66% 
Title: Partial return of the liquidation penalty
Eligibility to claim sICX:
- Liquidated borrowers between Jan 20th and Jan 24th 2022.
- Non-liquidated borrowers.
Total amount of sICX to use: During the liquidation event over 1.95M sICX was paid in liquidation fees (33% of the total collateral). 1.525M sICX of this was added to the emergency reserve. 1.32M sICX will be returned to liquidated borrowers and 100k sICX will be distributed to non-liquidated borrowers pro-rata the loan on Jan 20th. This leaves over 106k sICX to be added to the original 743K sICX in the emergency reserve for platform enhancements.
Description
On Jan 20-24th 174 borrowers got liquidated in exceptional circumstances. Rebalancing progressively increased loans, often locking collateral. During this period 1.53M sICX in penalty fees was added to the emergency reserve. As a sign of goodwill, 1.32M of this liquidated sICX will be returned, scaled linearly (18-25%) from beginning to end. To support non-liquidated borrowers, 100k sICX will be distributed pro-rata. All sICX will come from collected penalty fees.
What happened
Read all: Jan 2022 market crash post-mortem
Howmuch sICX will be distributed to each address
In this document you can find howmuch sICX will be distributed to each address. You can verify the data by searching for your own wallet-address, looking on-chain and/or requesting the raw data.
What is the reasoning for these numbers?
An important point of this proposal is to return valuable assets to valuable community members without taking anything from the DAO or taking any additional funds from the emergency reserve. If this proposal will pass, it will not affect any other users of the platform and solely return some of the liquidation penalty. Furthermore, to support all borrowers that protected the value of bnUSD during the event, 100k sICX will be distributed to all non-liquidated borrowers pro-rata their loan on January 20th. This sICX will be distributed to acknowledge that many non-liquidated borrowers had to sell assets to counter the rebalancing and avoid liquidation.
The linear scale is applied in the proposal to create a fairer distribution. Reasoning being:
- The later borrowers got liquidated, the higher the loss of assets. You can read about this in the detailed analysis from @particleX
- Borrowers that got liquidated sooner most likely had a higher risk position to begin with and should therefore not receive the same compensation as lower risk positions.
The scale starts at 18%. This aligns with the current liquidation penalty to avoid any discussion about more recent liquidations outside of this event.
How will the claiming process work?
If the vote gets the approved (>66,66% approval rate) the proposal can be enacted. This will work as follows:
- The vote releases the sICX from the Emergency Reserve and sends it to the Batch Disbursement Contract.
- In this contract the sICX will be devided amongst all eligible wallets.
- Users can then claim the sICX from that contract.
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Now a few examples of what different numbers would look like (calculated with the spreadsheetscript I provided earlier (read ‘disclaimer’):
18-25%
With a scale of 18-25%. 1.32M sICX will be returned to the liquidated borrowers. With the additional 100k sICX for non-liquidated borrowers this leaves over 106k sICX to be added to the reserve.
Flat 25%
With a scale of 25-25% (flat). 1.465M sICX will be returned to the liquidated borrowers. With the additional 100k sICX for non-liquidated borrowers this results in a ‘pricetag’ of 40k sICX for the emergency reserve.
18-33%
With a scale of 18-33% . 1.62M sICX will be returned to the liquidated borrowers. With the additional 100k sICX for non-liquidated borrowers this results in a ‘pricetag’ of 194k sICX for the emergency reserve.
15-25%
With a scale of 15-25%. 1.255M sICX will be returned to the liquidated borrowers. With the additional 100k sICX for non-liquidated borrowers this leaves 170k sICX to be added to the reserve.
3 Likes