Increased burn rate will increase the entire network’s borrowing power by driving vBNT value up and allowing others to sell their vBNT into the vortex.
It will also lay the path for an increase in the size of the vBNT/BNT pool - which has been completely full since inception.
This is a great point. The lower the price of vBNT the cheaper it becomes to accumulate voting power. Last week $1 of BNT bought $4 worth of voting power. Incredible!
Bancor is an AMM first. We should focus on increasing TVL and trading fee APRs for a healthy long term platform.
Increasing the rate of burn directly increases the total TVL - drastically. Did you read the original post? Please read it again.
Higher burn = more BNT locked forever (more TVL)
Higher burn = higher vBNT price = less people are scared of the peg and will vortex their vBNT = MASSIVELY more TVL
Something something bonding curve. There’s only 2M vBNT in the pool available.
The idea of increasing the burn rate as raised awhile ago when the peg first started plunging. The counter argument shouldn’t be “well, the DAO voted for an 18 month schedule” because a) the DAO can and should change its decisions in response to new information and b) the 18 month schedule was arbitrary.
To me, the best argument against raising the burn earlier this year was that fee APYs were already low and that siphoning off more for vortex wasn’t good for growth. Currently, swap APYs are much better so the hit won’t be as noticeable. Is there another coherent argument against that doesn’t involve simp? Serious question.
I don’t think jumping right to 20% is smart but moving to 10% might be reasonable.
Fee APY’s should be disregarded completely when LM rewards are paying 60-80% on a consistent basis.
The idea (as another commenter already posted) is to tax these inflationary rewards at a higher rate while we can - 5% is just far too low - and build up the permanent base of liquidity. Thus the proposal seeks to reduce the fees back down when LM rewards sunset.
The DAO will move to 10% fee in 2 months - regardless of this proposal - as per the original +5% per 6 month increases.
As another commenter mentioned - this vote simply moves the timeline up by about 8 months.
For reference, xsushi rate is 16.67% … so 15-20% is within range of other amm/dex/etc.
You’re forgetting the second side of “1-way staking”. Sure, more BNT will be staked, but you’re disincentivizing the TKN side from staking by reducing fee APRs.
There’s only so much protocol BNT that can be replaced by people vortexing their BNT.
This does not sound like a sustainable solution to me.
So let’s win by undercutting the competition and providing better returns.
Yes. we did that. We ended up at 0.25BNT per vBNT. We can lower the burn rate to 5% when we actually have $5B daily volume.
There is no disincentive here. Again, I direct you to the original thread. Where else can LP’s go to get 100% protection from impermanent loss, while maintaining full 100% exposure to their favorite token and earn swap fees?
These services are not free. The payment for these services is an “insurance premium” - the cost? The vortex fee.
.25
Nice. It was 0.8BNT 40 days ago.
The actual burn even at 20% will not really be “spiking” the vBNT price up . It will spike from the psychology point because there was no reason to buy back their vbnt because it just kept going down and with ever market dump, ppl are interested in using vBNT to buy the dip on something else. Increasing it to 20% at our current volumes won’t do much directly to vBNT as much as the indirect psychology point. I think there needs to be a balance as opposed to a forever bleeding vBNT ratio with the current environment
So why do it?
It will, however, reduce trading fee aprs by 15.78%.
so? 24 hr lock its not like that did anything
Just stating facts:
Take your own conclusions, I’m not trying to bring drama to the forum. But it’s not a good look. At the very least, this isn’t a very transparent way to bring a proposal such as BIP. Please take the governance forum more seriously.
