Emission Reduction Proposal
After an in-depth discussion among the DAO, we believe that there is merit in proposing a reduction in emissions towards specific streams in the XBE protocol. This will allow us to trim off high paying pools and redirect these emissions to be allocated to the XBE treasury. These XBE will then be used for future liquidity incentives to bootstrap ideas utilizing the Hive design.
Four options will be provided to vote on.
At this current standpoint, many protocols including XBE have seen a substantial decrease in their liquidity, from both inflationary gov rewards, as well as an overall decrease in the ETH price. There are several ways that we can counter this, however increasing the operational costs during this time, in situations that can be mediated without development does not seem wise as we can use those funds for more pertinent development items.
In the short term, we propose the following options to counter high inflationary gov rewards, and to aid future liquidity incentives;
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Do nothing and keep emissions as is.
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Reduce some emissions from LP, stakers, and the Hive.
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Reduce some emissions from LP.
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Reduce ALL emissions.
The emissions from the above would be directed to the XBE treasury.
With the proposed options, here are objective data points that we can use to come to a conclusion;
Path 1 is self explanatory and does not need to be elaborated on.
Path 2 suggests that we reduce some emissions from all the streams and direct these towards the XBE treasury. This would mean reducing emissions by 17.5%; with 10% from LP, 5% from the Hive, and 2.5% from stakers.
This would result in:
- 22.5% to Stakers
- 12.5% to FRAX
- 12.5% to cvxCRV
- 35% to Sushi LP
- 17.5% to XBE treasury.
At the time of this writing, this method would still yield ~119.63% APR for Sushiswap liquidity providers. It would allow for the treasury to yield a high amount of emissions, meaning we would have more incentives for future concrete Hive based solutions. This method would, however, reduce the APR on the Hive and XBE staking which has potential to reduce the current TVL in those two areas.
APR calculated using 35% of emissions, at current XBE price, and using the TVL from the app UI.
Path 3 suggests that we only reduce emissions towards SushiSwap LP, and direct these towards the Treasury. We propose to reduce LP emissions by 15%.
This would result in:
- 25% to Stakers
- 15% to FRAX
- 15% to cvxCRV
- 30% to Sushi LP
- 15 % to XBE treasury.
At the time of this writing, this method would still yield ~102.54% APR for Sushiswap liquidity providers. It would not reduce the emissions on the other streams which stands to keep our APRs competitive, and our protocol TVL relatively stable. This option would still have the largest portion of emissions being directed to Sushi LP making it the highest yielding pool. On the contrary, this option would reduce the current APR for Sushi LPs. That being said, the 15% of emissions can then be used for future concrete Hive based solutions
APR calculated using 30% of emissions, at current XBE price, and using the TVL from the app UI.
Path 4 suggests that we reduce all emissions on all streams, and direct these towards the treasury. This method would yield the highest for the treasury meaning we have the largest amount to use for future bootstrapping ideas. However, this method would reduce all the APRs and has the potential to see a large reduction in protocol TVL.
With the above information being shared, we now want to take this to a governance vote:
Vote:
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Do nothing and keep emissions as is.
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Reduce some emissions from all streams.
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Reduce some emissions from LP.
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Reduce all emissions from all streams.
Link to snapshot will be provided later today: