SIP-25: Ramp up the Amplification Coefficient of Frax pools

Summary

Ramp up the Amplification Coefficient of the new FRAXBP, as well as any constituent metapools, that meet the standard for TVL set out by this proposal.

Abstract

This SIP seeks to increase the Amplification Coefficient [known as, ‘A’] of the FRAXBP and FRAXBP metapools with > $1m TVL.

Motivation

Increasing the Amplification Coefficient from 100 to 500 on FRAXBP metapools, and from 500 to 1000 on the FRAXBP itself, should give them a more competitive depth, and performance analogous to the industry standard.

The higher a pool’s Amplification Coefficient is, the wider the range of no-or-low-slippage swaps is. Lower slippage implies more competitive rates and greater volume, which will positively benefit both LPs and the protocol.

Specification

The multisig will queue txn’s to increase Amplification Coefficients according to the following table:

Pool	TVL ($)	Current A	Proposed A
FRAXBP	+1M	500	1000
FRAXBP[meta]	+1M	100	500

[Note: The Amplification Coefficient will change over time as transactions occur, eventually reaching the target set by this proposal. The Amplification Coefficient may only increase by a maximum of 2x over the span of two weeks-- Meaning it may take some metapools up to 1.5 months to reach their desired 'A' value.]

For: Ramp up the 'A' of the FRAXBP, from 500 to 1000. Ramp up the 'A' of any metapools with +$1m TVL containing FRAXBP LP tokens, from 100 to 500.

Against: No change.