I feel that POL is going to cause us problems in the long term if we don’t address it. Especially if what we see happening in the BTCB/bnUSD pool starts to occur in other pools like sICX/bnUSD (Liquidity leaves the pool to find better incentives, votes leave the pool because the incentives just go to DAO ~ possible explanation).
The situation today:
~3865 BALN inflation today
~1816 BALN to Liquidity Pool Incentives
~508 BALN inflation recaptured through POL
~28% of Liquidity Pool incentives recaptured
~13% of total BALN inflation recaptured
sICX / bnUSD
POL: $636,379
Tot: $1,526,042
41.7% POL in LP
POL Incentives: ~227 BALN
Total Incentives: ~545 BALN
BALN / sICX
POL: $181,999
Tot: $981,752
18.5% POL in LP
POL Incentives: ~100 BALN
Total Incentives: ~542 BALN
BTCB / bnUSD
POL: $201,780
Tot: $216,934
93% POL in LP
POL Incentives: ~87 BALN
Total Incentives: ~94 BALN Future Total Incentives: ~38 BALN
ETH / bnUSD
POL: $44,193
Tot: $84,182
52.5% POL in LP
POL Incentives: ~94 BALN
Total Incentives: ~179 BALN
Problems:
Liquidity Providers are competing with POL for incentives
The DAO is renting liquidity from itself (if we own it, why are we renting it?)
Staking bBALN circumvents Vote for adjusting DAO’s share of fees (currently 70.14% DAO / 29.86% bBALN stakers, after 2 months, what will it look like after 2 years and even more POL?)
Yeah, as much as I’ve liked directly seeing how much BALN is taken off the market from POL I do agree that it kind of just undoes what we’ve already voted on and makes future decision making less clear. I’d support this change.
I disagree, this would be a wishy washy move. This is a built in way for the DAO to keep Baln inflation under control. If we are raising inflation and not letting the DAO keep rewards that’s a double whammy dilution event to Baln. Let’s not be wishy washy here.
I see your disagreement, and raise you I couldn’t disagree more.
Having the DAO recapture BALN from liquidity rewards, then stake it as bBALN, is by far the more “wishy washy” move.
If we don’t want more BALN inflation, we shouldn’t increase inflation.
If we want less BALN inflation, we can vote for that.
If we want the DAO portion of network fees to increase, we should vote for it.
Renting liquidity that was purchased so we don’t have to rent liquidity is wishy washy.
Increasing the DAO’s portion of network fees without voting for it is wishy washy.
bBALN LP incentive votes for pools with POL essentially being votes to recapture BALN instead of incentives to liquidity providers is wishy washy.
As a DAO, we can manage BALN inflation and network fees directly, we don’t need to recapture BALN LP incentives or stake bBALN. By doing so, we make the bBALN incentive votes less meaningful in the very pools we are trying to attract liquidity for.
I am fine with your idea if we don’t raise inflation to 5k a day and continue it on its current path. I would be fine voting for that. But the idea you proposed and Benny proposed is a double whammy of inflation.
If we want Baln to grow in value let’s do one or the other:).
But I also see how BALN DAO wants to self fund and control its destiny. The icon foundation stakes it’s own token, so I can see the benefit of it for balanced to want to spin the wheel of recycling tokens that favor positive growth for the DAO.
Make sense?
I have to agree as well, even though i love the frontend design for it. However, since we can’t decrease incentives for specific pools i think it is good if we keep to option to stake LP tokens. And we as a DAO could stake to lower inflation in a pool if we want.
While increasing or decreasing BALN incentives is the most precise tool, we can’t use that to remove incentives from pools we might want very little incentives on.