QIP217: Liquity Mining Changes on Polygon PoS

Summary

This proposal aims to create a sustainable system of token flows for QiDao on Polygon PoS (“PoS”). The proposed change is to allocate all revenues from QiDao’s PoS deployment to MAI liquidity mining on that chain, to fully replace any other liquidity mining done by the protocol on PoS. It would also replace other revenue sharing charters for PoS: aveQI and MAI buybacks.

Abstract

The change involves the following:

• Halting current liquidity mining programs at Retro and Curve, which are funded with treasury assets.
• Allocating all revenue from PoS to incentivizing MAI liquidity. DEX partners would be chosen based on the highest efficiency of incentivization, smart contract risk, and ability to attract liquidity providers.

Motivation

Currently, the DAO spends around $377,000 / year on PoS incentives, and makes only $17,573 / year from performance fees & an average of $40,000 / year from repayment fees.

This difference is mainly due to low loan fees from V1 vaults, which return 0.5% to the DAO upon repayment. Importantly, these vaults do not have ongoing performance or interest fees.

The funds that are being used to incentivize MAI on PoS could be put to better use on other chains where there are more immediate opportunities for growth and revenue. These include Polygon zkEVM, among others.

Specification

Rationale

This proposal ensures that the DAO will no longer spend more funds than it makes on Polygon PoS.

Technical Specification

No technical specifications. Only operational changes.