FIP-37: Fei v2 TRIBE Buybacks

Summary

Begin the Fei v2 rollout with TRIBE buybacks as a percentage of protocol equity, either 5%, 10%, 15%, or 20% APR. All bought back TRIBE will initially be sent back to DAO treasury.

Forum discussion: https://tribe.fei.money/t/fip-37-fei-v2-tribe-buybacks/3571

Design

Buybacks use Balancer v2 LBPs to efficiently and continuously auction newly minted FEI for TRIBE.

Fei v2 has a contract called the PCVEquityMinter which mints FEI proportionally to the protocol equity and a given duration. For example an APR of 10%, frequency of every 1 month and equity of $120m would do $1m FEI of buybacks per month.

At the end of the month, the previous FEI->TRIBE auction will close and a new one will kick off.

The proposed initial parameter is 1 week frequency for buybacks with an initial trial week of 100k FEI.

The APR would be voted on by TRIBE holders, and be either 5%, 10%, 15%, or 20%. This number will be revisited in 6 months via snapshot.

At a current protocol equity of over $700m, this would amount to $35m, $70m, $105m, and $140m worth of buybacks in the first year, respectively.

The tradeoff of a larger buyback means less protocol equity to absorb market volatility (and prevent backstop). However, larger buybacks also increase the effective APR of liquidity mining and protocol treasury size. Note that buybacks will initially go exclusively back to the treasury for initial rollout, but as more v2 features roll out portions can be burned, added to tribalChief rewards, or sent elsewhere.

Voting Rules

This is a non-binding, approval style signalling vote. It will last from 1pm PT Oct 24 to 1pm PT Oct 26. The options are:

• 20% APR
• 15% APR
• 10% APR
• 5% APR
• No buybacks

Quorum is 10M TRIBE. The most approved option will be submitted to the DAO.