Extend LM rewards in the Stablepools (USDC, USDT, DAI) for 8 weeks from the 23rd February 2022

Voting ended about 4 years agoSucceeded

To pass, this proposal needs 35% quorum and 66.7% supermajority.

TL;DR

The LM rewards on stablecoin pools (DAI, USDC, USDT) are extended from the 23rd February 2022 until 20th April 2022 (another 8 weeks), and can continue being extended by the DAO.Current stable tokens liquidity is essential to stay in the ecosystem to maintain the protocol momentum and support the migration of liquidity from Bancor v2.1 to Bancor 3.
The LM rewards are being extended to maintain current stable pools protocol liquidity in anticipation of Bancor 3. Bancor should not lose the momentum and cut out the LM rewards on stablecoins.
To support a flawless migration, a new liquidity mining program will be released together with the Bancor 3 release. A proposal to create a Dual LM rewards programme with BNT being emitted over 24 months has passed through the BancorDAO Governance Forum and Snapshot [1][2].

Discussion

At this stage, current protocol growth requires LM to maintain the momentum and stay competitive in the space.
After achieving the position of market leader in both TVL and volume, LM extension will no longer be necessary, and the voting for LM extensions may be concluded.
Bancor 3 will significantly reduce the pressure resulting from insurance on all the assets, and should increase the protocol revenue from trading fees.
A large majority of the LM rewards are re-staked to the protocol, increasing the TVL and the space available for TKN deposits with single sided exposure. If this trend continues, the LM program is more of an asset than a liability, and can be managed more assertively. Bancor 3 will feature reward auto-compounding - LM can therefore be a mechanism to increase liquidity in the pools. 33,620,099 BNT Rewards have been re-staked vs 15,359,874 BNT rewards that have been claimed.
In the long term, Bancor is aiming towards sustainable annual inflation of 2%, in order to achieve that, Bancor requires significant volume and Vortex to be applied.

Volume, fees, 24hr APR and weekly APR

Weekly volume and fees from the USDC, DAI and USDT pools from the week of the 30th of August have been consistent. The DAO has been running experiments with the swap fee in the stablepools.

Since January 11th, the weekly APR for the DAI, USDC and USDT have been in the ranges: DAI: 2% to 13% USDC: 6% to 33% USDT: 4.5% to 26%

This post is very similar to the previous stablepool LM extension [6], as the arguments to extend it then are very similar to the ones now ahead of B3 release.

FOR Extend LM rewards for the USDC, USDT and DAI pools for 8 weeks from the 23rd February 2022.

AGAINST Do not extend the LM rewards for the USDC, USDT and DAI pools.

[1] https://gov.bancor.network/t/proposal-addendum-incentivize-users-to-migrate-to-v3-by-matching-token-side-lm-rewards-with-up-to-50-000-bnt-per-pool/3355 [2] https://snapshot.org/#/bancornetwork.eth/proposal/0x41c9e56d73dcbdc3311491e7f4dd991e0683eb28d2656f039f6c02108ace5e04 [3] https://gov.bancor.network/t/proposal-stablecoin-pools-fee-experiment-and-analysis/3292 [4] https://gov.bancor.network/t/proposal-change-stablepool-fees-usdt-usdc-dai-to-1-0-1-0-and-1-5-respectively/3357 [5] https://dune.xyz/queries/30793/62118 [6] https://gov.bancor.network/t/extend-lm-rewards-in-the-stablepools-usdc-usdt-dai-for-6-weeks/3282

Off-Chain Vote

For

4.59M 67.6%

Against

0 0%

Abstain

2.2M 32.4%

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Timeline

Feb 13, 2022Proposal created

Feb 13, 2022Proposal vote started

Feb 16, 2022Proposal vote ended

Oct 26, 2023Proposal updated

TL;DR

The LM rewards on stablecoin pools (DAI, USDC, USDT) are extended from the 23rd February 2022 until 20th April 2022 (another 8 weeks), and can continue being extended by the DAO.Current stable tokens liquidity is essential to stay in the ecosystem to maintain the protocol momentum and support the migration of liquidity from Bancor v2.1 to Bancor 3.

The LM rewards are being extended to maintain current stable pools protocol liquidity in anticipation of Bancor 3. Bancor should not lose the momentum and cut out the LM rewards on stablecoins.

To support a flawless migration, a new liquidity mining program will be released together with the Bancor 3 release. A proposal to create a Dual LM rewards programme with BNT being emitted over 24 months has passed through the BancorDAO Governance Forum and Snapshot [1][2].

Discussion

At this stage, current protocol growth requires LM to maintain the momentum and stay competitive in the space.

After achieving the position of market leader in both TVL and volume, LM extension will no longer be necessary, and the voting for LM extensions may be concluded.

Bancor 3 will significantly reduce the pressure resulting from insurance on all the assets, and should increase the protocol revenue from trading fees.

A large majority of the LM rewards are re-staked to the protocol, increasing the TVL and the space available for TKN deposits with single sided exposure. If this trend continues, the LM program is more of an asset than a liability, and can be managed more assertively. Bancor 3 will feature reward auto-compounding - LM can therefore be a mechanism to increase liquidity in the pools. 33,620,099 BNT Rewards have been re-staked vs 15,359,874 BNT rewards that have been claimed.

In the long term, Bancor is aiming towards sustainable annual inflation of 2%, in order to achieve that, Bancor requires significant volume and Vortex to be applied.