Proposal: Extend LM Rewards for The Graph (GRT)

Governance Forum Link: https://gov.bancor.network/t/proposal-extend-lm-rewards-for-the-graph-grt/2065

As a community member and LP on both sides of the BNT/GRT pool, I would like to propose extending the LM Rewards for GRT for an additional 12 weeks.

The Graph has become a standard blockchain querying service for multiple ecosystems. Since initial whitelisting, the Graph has added indexing and querying services for: Polkadot, NEAR, Celo, Solana, Polygon, Fantom and BSC, in addition to Ethereum and IPFS which have been supported since launch. The Graph has grown in query volume an average of over 20% month over month, and recently announced over 20 billion queries serviced for the month of April. They also recently unveiled Scalar, a high scalability payments service for compensating indexers for query requests. The Graph is well positioned to become a major querying service for the entirety of Web3.

The Graph pool has brought $23M of liquidity to Bancor and regularly supports daily volumes in the low seven figures. Interest in joining the GRT side of the pool has been high, with the GRT side frequently having very little or no space available. The LM Rewards mechanism clearly attracts GRT liquidity providers who are interested in APY. The current LM Rewards (plus fees) results in an APY of nearly 28%, far exceeding the APY for delegation in the Graph, which tends to be around 10%. With the much-anticipated unlocking of coins in June and July, it is possible that the Graph delegation APY would become even less attractive to stakers owing to additional competition. This would result in more significant interest in staking in the Bancor pool.

As the Graph expands with the growth of Web3, Bancor’s LM Reward support will attract more liquidity, providers, and volume. Thank you for considering this request for extension.