Vote 5: GRO Rewards Changes

This proposal was discussed on the forum as the synthesis of Slacking’s forum proposal, Shroom’s forum proposal and by various contributors on Discord.

PROPOSAL SUMMARY

If executed, this proposal will start work to implement following changes:

• Performance fee of 5% for Vault and PWRD yields.
• Performance fee of 10% for new Labs products.
• Performance fee buys back GRO from the market.
• GRO acquired from performance fee delivered as Vesting bonus to users. 10% of the performance fee delivered to the DAO treasury.
• Users can partially exit the vesting contract to take a portion of their GRO.
• Users can claim Vesting bonus at most every 4 weeks.
• Users can lock externally acquired GRO into the vesting contract.
• Users can voluntarily extend their vesting duration up to the max length (12 mths).
• Users can claim rewards immediately as liquid GRO or vesting GRO. If liquid GRO, 30% will go to their wallet and 70% to the Vesting bonus. If vesting GRO, 100% will be added to their vesting position. The 30% will be a parameter that the DAO can adjust.
• Users’ 1 year vesting schedule will change from current 10->100%, to 0->100%. Already existing vesting schedules will also rescale as if they had started at 0%.
• Users can claim multiple pools in one single claim for some gas savings.
• A separate vote will be created specifically on options for scaling the rewards center on other chains, since it is a much more complex topic.

BACKGROUND

Gro DAO Token is used to (1) Vote in Governance, (2) Claim Vesting bonus, and (3) Pair in liquidity pools to earn GRO. Locked GRO in the vesting contract enables Vesting bonus claims but the only way to get more locked GRO is through mining rewards or airdrops. Locked GRO is like Curve’s veCRV but with more limited utility right now. Few people are exiting the vesting contract so less vesting bonus is generated (2), making locked GRO less compelling. The primary utility is governance (1). This proposal increases the utility of locked GRO by increasing the GRO Vesting bonus and enabling special product access to locked GRO.

DETAILS ON THE PROPOSAL

Enable Performance fee that users can claim as a Vesting bonus:

• Enable 5% performance fee on base products (Vault & PWRD) yields.
• Enable 10% performance fee on Labs products (e.g. upcoming Avalanche) yields.
• Performance fees buy GRO and delivers to active users as Vesting bonus. 10% of acquired GRO go to DAO treasury.

Make it easy to get liquid GRO for short-term farmers AND increase the vesting bonus for long-term DAO members:

• Let users choose 30% liquid GRO directly on claiming (70% goes to Vesting Bonus), OR 100% with 1 year vest.
• Change vesting schedules to go from 0% to 100% over 1 year
• Enable partial exits from the vesting contract with prorating of the exit fee. Example: User has 100 GRO in vesting contract. 90 GRO locked and 10 unlocked. User exits 50%. 50 GRO remains in the Vesting contract. 5 GRO goes to their wallet and 45 goes to the Vesting bonus.

Reduce user cost of claiming GRO:

• Extend Vesting bonus claim cooldown period to 4 weeks. This halves the number of gassy actions needed to claim vesting bonus, and doubles the size of each claim.
• Combine multiple pool claims into a single transaction. This would result in some gas savings for people who are participating in multiple pools.
• Continue scoping migrating vesting contracts to cheaper/faster chains (this is a big piece of work and the core team is currently scoping several options)

Get early/more/better access to Gro products through locked GRO:

• Threshold amount of locked GRO will be a requirement to access some new products from Gro. E.g. upcoming Gro Labs on Avalanche.
• Higher amounts of GRO will enable better product experiences like higher deposit allowances and rewards multipliers.

Enable users to increase locked GRO (as this will have more utility from increasing vesting bonus and special product access):

• Users can acquire GRO from the market and lock it into the vesting center to increase their locked GRO.
• Users can voluntarily extend their vesting schedule up to the max duration of 1 year.

After passing this proposal, the core team will come back with an implementation timeline.

HOW WAS THIS PROPOSAL DISCUSSED?

This proposal was put together by early contributors behind Gro protocol. It has been shared in the Gro governance forum: https://community.gro.xyz/t/draft-for-revised-gro-tokenomics/188

REFERENCES

Slacking forum proposal: https://community.gro.xyz/t/tokenomics-idea-create-stronger-symbiotic-relationship-between-gro-and-protocol-product/123/6

Shroom forum proposal: https://community.gro.xyz/t/improvement-proposal-gro-tokenomics/166