Proposal: Activate LM Rewards for Enzyme (MLN) with an 8-Week Duration + Increase Co-Investment Limit to 500k
This proposal is expected to appear on Snapshot for voting on Monday, August 2nd at 12:00 pm UTC
Proposal to add LM rewards to the BNT/MLN pool with an 8-week duration, and increase the co-investment from the Bancor DAO from 250k, to 500k BNT. Reward rate would be similar to that of the FARM/BNT pool, which will see 5k BNT/Week for 8 weeks.
TL;DR
*** Enable LM rewards at 5,000 BNT/week for 8 weeks.**
*** 8 weeks to capture MLN LP’s from the Sushi MLN/WETH pool who are suffering >30% IL.**
*** Priority is to grow the MLN/BNT pool to be the biggest pool for MLN liquidity.**
*** 50/50 split rewards on BNT/MLN.**
*** Enzyme DAO members have contributed over 10,000 MLN to the pool (>$700k) resulting in there being great confidence from the Enzyme community in Bancor’s IL protection mechanism and liquidity provision incentives.**
Primary Focus of this LM Campaign
Enzyme Finance has a strong DAO of asset managers that have taken notice of the depth of pools across the Bancor Network and has shown support for Bancor by adding over 10,000 MLN to the BNT/MLN pool increasing pool depth by 35%. The primary focus of this LM campaign will be to target LPs from the Sushi Swap MLN/WETH pool that currently has ~$3.1m in liquidity. WETH-MLN | SushiSwap Analytics
Unfortunately there has been IL >30% by providing liquidity to this pool on Sushi Swap, meaning this LM campaign can serve as a polarizing incentive for MLN LP’s to bring their liquidity to Bancor. Target: >$3.5m in total pool depth on Bancor (Current: $2.1m)
In comparison to other LM campaigns + Benefit to MLN Holders/LP’s:
In many ways the idea for this LM campaign was inspired by the success of the FARM/BNT LM campaign, that has managed to pull significant liquidity from Uniswap and bring it, as well as the goal of targeting the buyback mechanism to Bancor, increasing volume, which in turn generates more fees for LP’s. The goal is the same for MLN, however, there is no buyback mechanism (yet), and MLN holders are still looking for the best place to park their MLN holdings with mitigated risk, which as we know, Bancor is that place. This LM campaign would make that a no-brainer and open the door to another $1.55m of MLN liquidity sitting (suffering) on Sushi Swap, along with the increased BNT co-investment from the DAO would open up another $1.6m of MLN liquidity to be deposited. So in just upside alone, there is ~$3.1m (depth of the Sushi pool!) worth of MLN liquidity to go after, making Bancor the default source of liquidity to trade MLN. MLN fees have also shown to have picked up greatly over the last 60-90 days, and show no sign of slowing down, after having being listed on Coinbase as well as Binance, will move activity on-chain for trading, as holders steadily grow - currently at 5,475.
Public Support, Team/Community Strengthening, & TAM Opportunity.
It is no secret that Bancor V3 is well underway, and Enzyme Finance is in the process of finalizing their Sulu (V3) rollout. Both protocols are in the works shipping massive upgrades and appealing to wider and wider user bases. On Enzyme, asset managers (making up its $93m in TVL) can provide liquidity across a variety of platforms (in which they suffer great IL from, depending on the pair) Enzyme asset managers ultimately fit the ethos of the Bancor Network in the sense that they are protecting depositors assets. An ambitious partnership in the future could be LP’ing on Bancor directly from the Enzyme UI, and as treasuries (such as Unslashed Finance’s treasury) get deposited into Enzyme, they will seek vehicles to grow/protect their treasury assets, as DeFi becomes more interoperable, one vehicle could be Bancor in the not-so-distant future. A greater purpose for this LM campaign is further cementing comradery between the Bancor x Enzyme communities and acknowledging the Enzyme DAO’s support for Bancor, as their team would publicly back this proposal and vote.
Voting Options
- FOR - 8 Weeks at 5,000BNT per Week
- Against - No LM Rewards