SIP-56: Proposal to reduce emissions

Author: Sperax Core Team Reference: Sperax docs, SIP-32 Created: October 10, 2023 Labels: #Liquidity-Mining, #Product-Features

Summary

In 2023, SperaxDAO is taking significant steps to address two pivotal aspects: mitigating SPA emissions and augmenting the circulation of USDs. To achieve these objectives, the team is proposing protocol enhancements:

• Decreasing SPA emissions from Demeter farms by 50% and curbing SPA bribes dispensed by SPA Gauge by 20%.
• Shifting Demeter emissions to xSPA

Motivation

• Since the inception of Demeter, the Sperax treasury has emitted over $500K of SPA tokens. The emissions were to contribute towards increasing the overall ecosystem TVL. Although there are various factors affecting the TVL, the total Demeter TVL has dropped by more than 50% in the last 5 months.
• Presently, SPA inflation remains relatively high, exerting selling pressure. In accordance with SIP-32, we aim to reduce inflation in 2023. We offer a 50% overall reduction in Demeter and Gauge emissions.

Overview

In 2023, SperaxDAO is committed to reducing unnecessary SPA emissions while simultaneously boosting the circulation of USDs.

• Demeter farms currently emit 414500 SPA tokens per day, while SPA Gauge disburses 383,550 xSPA per week as bribes. The proposed solution involves reducing weekly emissions from the SPA Gauge by 50% and trimming the bribe budget by 20%.

The new bribe distribution for the farms is as follows:

• SPA/USDs Camelot - 68186 xSPA/week
• SPA/USDs Uniswap v3 - 68186 xSPA/week
• USDs/USDC.e Uniswap v3 - 45357 xSPA/week
• USDC/USDs Uniswap v3 - 45357 xSPA/week
• USDs/USDC.e Camelot - 45357 xSPA/week
• plsSPA/SPA Uniswap V3 - 34093 xSPA/week

Technical Specifications

• To achieve an overall SPA inflation reduction of 50%, the proposal includes reducing SPA emissions from Demeter farms by 50% to 207250 SPA tokens per week.
• Shifting rewards in Demeter farms to xSPA
• Reducing bribes by 20% and redistributing it as mentioned in the overview.

Voting

For:

Implement the proposal to reduce SPA emissions and shift rewards to xSPA

Against:

Develop an alternative proposal aimed at reducing inflation and enhancing the utilization of USDs