[AIP-10] Restrict pools of auraBAL competitors

Authors: 0xButterfield (Aura)

Summary

This proposal suggests that pools that are significantly composed of alternative or directly-competing liquid veBAL derivatives should not be entitled to $AURA emission, and thus should be “shut down” to remove them from the Aura system, as they present risks to Aura’s moat and flywheel.

Background

Aura’s key moat is currently derived from its liquid veBAL derivative, auraBAL. It is in the protocol’s interest to maintain the position of auraBAL in the Balancer ecosystem, because it forms the foundation of Aura’s flywheel for protocol growth.

The boosted staking and $AURA rewards that Aura can provide for liquidity pools are intended to foster the efficiency and growth of the flywheel.

If incentivised with boosted staking and $AURA rewards, liquidity pools that are composed significantly of alternative or competing liquid veBAL derivatives may potentially extract much more value than they could add, diminishing the flywheel effect for the protocol.

Recently, StakeDAO’s sdBAL-80BAL-20WETH-STABLE pool gauge was added to Aura. Given sdBAL is a competing liquid veBAL derivative to auraBAL this proposal suggests action should be taken by the Protocol DAO to restrict the rewards for this pool.

Terms

The Protocol Multi-sig should call shutdownPool on the Aura Pool Manager contract for the aforementioned pool of pid: 25 .

This transaction will shut down the pool by withdrawing everything from the gauge; this can later be claimed by depositors by using the Pool Manager’s withdraw function.

As of writing, the gauge has ~$120 in deposits, so no significant positions will need to be withdrawn in such a way until deposits are made.

In the future, if similar pools are added, this proposal gives the multi-sig authority to consider taking the same action without the need for a new proposal.

Voting

This vote will be a single-choice vote. You may vote “For” or “Against” this proposal, or choose to abstain from the vote. By voting “For” this proposal, you are voting in favor of the Protocol DAO calling the aforementioned shutdown transaction on this pool, and to consider taking the same action for similar pools in the future.

Background Information

Aura Pool Manager Contract

sdBAL 8020 Balancer Pool