Abstract

This proposal presents two motions for community consideration and voting:

• Motion 1: Redistribution of vePENDLE Voter rewards (changes to EIP#3)
• Motion 2: Adjustment of vePENDLE Base rewards distribution

This proposal is created entirely based on suggestions from our community and aims to clarify the utilization of vePENDLE rewards.

Motivation

The implementation of EIP#3 has been in effect for three months. During this time, we have actively gathered community feedback, and based on that input, we propose the following changes to enhance the sustainability of voter rewards.

Since the launch of Equilibria, 100% of Base rewards have been allocated to the ePENDLE Stake Vault. Due to Pendle’s distribution schedule for vePENDLE rewards, Base rewards are provided to Equilibria on a monthly basis. Consequently, these rewards become available for claim by users of the ePENDLE Stake Vault. However, this yield has not been reflected in the APY of the ePENDLE Stake Vault, meaning it is not factored into the pricing of ePENDLE PT/YT.

With the upcoming launch of the renewed ePENDLE boosted pool on Arbitrum—and the expiration of the current boosted pool on Ethereum set for September 26, 2024—we have an opportunity to offer users a more gas-efficient way to engage in ePENDLE liquidity provision and yield trading. To utilize Base rewards more effectively, we propose directing them to support the ePENDLE/PENDLE peg and to benefit the EQB community as a whole.

Specification

Current implementation

Voter Rewards

• 50% is used to buy back ePENDLE.
• 50% is distributed among vlEQB voters.

Base Rewards

• 100% is distributed to ePENDLE Stake Vault.

With the acceptance and implementation of EIP#5, the new mechanism will be applied as follows:

Voter Rewards

• 40% will be used in two ways:
  • Allocating 40% to buy back ePENDLE from the market and used to bribe ePENDLE boosted pool (Arbitrum).
  • Allocating 60% to incentivize ePENDLE liquidity on DEXes through direct incentives, bribes, or other effective methods.
• 60% will be distributed among vlEQB voters.

Base Rewards

• 50% will be used to buy back EQB and added to Treasury. The uses of the EQB include bribe ePENDLE boosted pool and DEXes.
• 50% will be used to purchase PENDLE, which will then be supplied as liquidity for the ePENDLE/PENDLE pool.

Your contributions and suggestions are invaluable to the development of Equilibria. Therefore, we would like to thank the entire community for your participation and valuable input.