Motivation:

Driving protocol adoption is currently one of the most important priorities for Pine with V3 of the protocol being progressively rolled out. Adoption is crucial to the Pine’s mission to build a long term sustainable operation. Instead of burning treasury funds, which is used for the runway for the project, on expensive marketing expenses, a more effective and efficient way to scale up protocol adoption is to provide incentives in forms of $PINE.

Specifications:

The proposal is to provide 208,000 $PINE from the Incentives pool as reward for protocol usage for Age 1 - Epoch 5, which is from 24 Mar 2023 UTC 08:01 to 31 Mar 2023 UTC 08:00. The distribution of tokens among the pools will be based on the level of activity and demand for each pool.

The 208K $PINE will be allocated to different categories of protocol usage and the breakdown is as follows:

For Borrowers:

• 42% of the rewards will be allocated to borrowers, pro-rata to the amount borrowed. This pool will incentivize users to borrow assets on the platform.
• 18% of the rewards will be allocated to borrowers who use NFTs as collateral on the Pine Protocol, pro-rata to the value of the NFTs (valued at floor price) escrowed.

For Lenders:

• 28% of the rewards will be allocated to users whose permissioned WETH are lent out, pro-rata to the amount lent out.
• 12% of the rewards will be allocated to users who permissioned WETH on the platform, pro-rata to the amount permissioned.

Snapshot will be taken on an hourly basis to determine the allocation of the rewards for that hour. Borrowers and lenders can see the amount of rewards they earn every hour but can only claim the reward at the end of the epoch.

Conclusion:

Incentivizing users to participate in different activities on Pine Protocol will increase the platform’s adoption and usage, ultimately making the operation sustainable. It would also play a big part in strengthening Pine’s branding and thus making it possible for Pine to grow rapidly and realizing its mission of becoming one of the key innovators and builders in the NFTfi space.

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