Feedback Request: V3 Vortex - Burn The Collected BNT or Wait

I agree with this wise person. I think my position is fairly clear at this point - but if the community isn’t convinced, I won’t push.

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A public countdown to a million BNT burn sounds like a great way to maximize the optics


i dont think a countdown or anything advertising related will make a notable difference. If i understand it correctly its a 0.5% burn of the total supply (210.181.197 supply according to coingecko). The burning itself matters no questions asked. But there wont be any hype becasue of this special burning. Everyone who still is engaged into the bancor project and token knows about the upcoming burning, the rest of crypto simply doesnt care at the moment becasue of the situation we are in.
For the reputation i think an advertisement can actually backfire. Some people could interpret it as some kind of mocking or false advertising that everything is ok. And these people are the loudest. If we like it or not in the eyes of crypto bancor is a failure right now (doenst matter if its true or not). Bancor has no reason to party or do a countdown as long as the deficit isnt shrinking.

Hey everyone. So I had a pretty long discussion with Dave in telegram and through that conversation a few interesting data points came to light. As of this post there is about 482,000 BNT sitting around waiting to be used - I’m just going to round this to 500k because it will be there in about 5 days anyway.

  1. Should we spend 500k BNT on vBNT and burn the vBNT all at once?
  2. Should we break up the spending into smaller parts over a longer time frame?
  3. Do we spend all 500k BNT on vBNT? Is there some magic number that is “correct” or “better”?
  4. So what do we do with 500k BNT?

Lets answer these questions in order.

  1. Should we spend 500k BNT on vBNT (“vortexing”)?

Burning 500k BNT would mean that 500k BNT is burnt (duh), but swapping to vBNT means that there is a chance to lock away even more BNT. A vortex of 1000 BNT results in 1167 vBNT (as of the time of writing) meaning that we are able to lock up an extra 11.6 % at, essentially, no cost.

But how much vBNT would a swap of 500k BNT get us? A vortex of 500k BNT would result in 420k vBNT. A NET LOSS OF MORE THAN 15%.

This gives s a very robust metric to work with when looking at the vortex: “what is the maximum amount of BNT that the vortex can accept before it becomes more efficient to just do nothing with the BNT?”

  1. Should we break up the spending into smaller parts over a longer time frame?

This is a decent point to look at - vortexing 50k BNT once a week could allow for time for users to sell their vBNT to the pool and make the vortex a net positive, because at current swap rates a vortex of about 200k BNT would bring the ration up high enough that it isn’t worth it anymore.

So I think a relevant question to ask is: is it worth it to break up the buys when you can’t even vortex 4% of the BNT we have without bringing the ration up?

Personally, I tend to think it would be a lot of legislation for the DAO for very little return. I am quite happy to budge on this position if someone can give me some kind of data-driven argument that “no, people will definitely sell vBNT if the ratio gets too high,” but I don’t think such data exists. Definitely could be wrong here though.

  1. Do we spend all 500k BNT on vBNT? Is there some magic number that is “correct” or “better”?

So sending 100k BNT to the vortex gets us an extra 9%

But sending 200k BNT to the vortex only gets us an extra 1.5% (check the 200k BNT image from earlier). The extra 1.5% is definitely not worth the legislation especially when a buy of 10k USD of vBNT would drive the exchange into a net negative. Its with margin of error essentially and we should just leave that to the V2.1 vortex.

  1. So what do we do with 500k BNT?

The data-driven responses are as follows:

A) Send 100k to the vortex and send the rest to be burnt.
B) Send 100k to the vortex and the rest to a DAO treasury which doesn’t yet exist.
C) Send it all to be burnt.
D) Send it all to the treasury which doesn’t yet exist.

I think that the best thing we can do is option C - send it all to be burnt, but this should not be a thing done quietly.

This should be a monumental occasion. We should wait and keep collecting until we hit 1,000,000 BNT. At the current rate that B3 is buying BNT that will happen in 6-12 weeks. Which is plenty of time to get the word out and let people know. And if it does work out that this happens about once ever 5-6 months, then we can start a cyclical hype train two times a year as “OH SHIT BOY ANOTHER MILLION!” shows people that there is enough use of the protocol that someone is paying for routine burns of 1000k BNT.

I think this is a very data driven argument; I would love for someone to pick apart my math/examples/reasoning if they are faulty and I hope that we can generate some consensus around one of these options.

Lastly, my opinion on the vortex - when the B3 vortex is fully built we absolutely should be using it to buy/burn vBNT when the ratio is below 1:1 (i.e., we get more vBNT than BNT when vortexing) and the rest of the time we should be stockpiling BNT for marketing purposes.


100% with you on this one. Its too marginal to get caught up in a DAO vote for potentially so little return, while I think we’ll get more bang for the buck on a very public million BNT burn. We’ll also learn more on the optics of an event like that, as you’re right, it shows that there are plenty of fees being generated to get to a million in the first place. Then it can become something fun, an event every so often for a massive burn. So we get a few benefits out of it, even if we learn that it didn’t garner much attention, thats still a useful data point.

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very well written.
putting data behind the arguments and trying to break it down is great.

i agree with option c, burn 100% of the BNT available in v3 vortex at this stage.

Let’s say you hype up a million BNT burn and get a lot of fanfare.

What do you expect to happen when the BNT is burned? The Bnt was already bought back, so it won’t impact price, right?

Do you think there’s any chance of a backlash here if burning a million BNT causes no impact at all?

I don’t know! Which is actually why I want to burn it. Bancor, historically, hasn’t done very well in the way of creating hype or social traction. People like token burns - so lets give it to them and measure the outcome.

I don’t know if it will be good, bad, or otherwise - but I strongly believe it will generate something in terms of social traction.

I personally don’t think it’s a good idea to hype an event that has a high likelihood in not impacting anything.

Seems like you should at least buy back and burn the vBNT to get it to 1:1 first and then try this experiment.

That’s totally reasonable.

The key thing here is actually experimenting is a good choice right now. What are they gonna do? Hate us more?


the point is to test this assumption and allow BNT burning.
few possible reasons:

  1. people understand simple solutions. if we burn BNT, it is easier to understand rather then explaining the vBNT vortex mechanics
  2. locked liquidity IS NOT completely unavailable since it is waiting an action. meaning, there is a chance it will be used somehow (even trade for vBNT is an action).

again, the point is to test with BNT burning and collect data points in order to optimize.

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@ZenoBNT thank you for providing a post with some good data. I wanted to mention that we should not forget that there is ~2.9m $vBNT in Uni v3 that is selling vBNT at different price points. As we get closer to a 1-1 rate all these vBNT will need to be bought and burned. If you take the Uni V3 pool into account, the price impact for selling 1m $BNT for vBNT is less than 5%