This proposal is expected to appear on Snapshot for voting on 2022-05-29T15:00:00Z. Make sure to stake your vBNT for voting before this date and time to participate in the DAO decision.
TL;DR
- In Bancor 3, external token projects can incentivise their own communities by providing liquidity incentives in their own TKN.
- To garner fast adoption, bring awareness to the External Liquidity Mining rewards tool, and lubricate the transition from Bancor v2.1 to Bancor 3, this proposal seeks to match the external team’s liquidity mining incentives in dollar value at the time of token commitment, up to a maximum of 50k BNT, emitted over a 24 months schedule.
- The matched BNT will be emitted over a 24 months schedule. The 2-year duration is chosen with a long-term view in mind.
- Bancor 3 launched on 5/11/22 in a limited capacity, with 4 pools (BNT/DAI/LINK/ETH). The remaining pools will be deployed as part of Proposal: Complete Token Migration to V3. Therefore, to provide enough time for projects and teams to deploy tokens and participate in the Dual LM Rewards program, an extension to the cut-off date is being proposed.
Procedure (To start around end of June/early July)
The cut off date of 8/31/22 is the date by which projects need to:
- Project needs to stake TKN into their pool and receive bnTKN
- Project needs to stake bnTKN into the auto compounding vault
Additionally, the following steps will take place after the above is completed:
- Message the Bancor team with the specific details about their program (start date, emission pace per second, etc)
- Bancor DAO msig sets the program in the contract
- Every vortex burn will trigger the auto compounding burn and transfer value to other bnTKN holders
External Liquidity Mining feature
Liquidity Mining is a convenient tool to bootstrap liquidity with proven results. Figure 1 and 2 show the WOO pool balance increasing significantly after LM rewards were activated, and finally stabilising at a higher TVL than before the program started. Figure 3 shows the Liquidity Share for the FARM pool increasing once LM rewards were activated, and stabilising at higher values.
Figure 1 - WOO pool balance over time. LM rewards started at the end of May 2021.
Figure 2 - FARM pool balance over time. LM rewards started at the end of July.
Figure 3 - FARM Liquidity Share on Ethereum.
Matching the rewards on TKN with BNT rewards means less BNT is needed for Liquidity Mining than v2.1.
Since the announcement of Bancor 3, there has been strong interest among white-listed tokens to offer LM rewards. Migration to Bancor 3 can be achieved in a single click via the Bancor app. The liquidity incentives discussed here are an important component in stimulating users to migrate from v2.1 to Bancor 3.
To accelerate the adoption, and help raise awareness for this feature, for each white-listed token that commits to their own auto-compounding rewards program, the BancorDAO will match the emissions value up to a maximum of 50k BNT.
There is no requirement that the token and BNT LM be on the same emission schedule; however, the BNT emissions will be non-negotiable and fixed over a 24-month period.
To receive the BNT rewards, LPs need to stake their LP tokens in a rewards contract. Decision on the rewards emission schedule is purposely open-ended and will be proposed and decided at a later stage by the BancorDAO.
In conclusion, the Dual LM rewards program seeks to:
- Incentivise LPs to migrate from Bancor v2.1 to Bancor 3.
- Increase awareness of the External Liquidity Mining feature.
- Attract more LPs from different communities to stake on Bancor and get familiarised with Bancor3 features.
- The BNT emission schedule has a long-term view in mind.
FOR
Accept the addendum to move the cut-off date from the end of May 2022 to the end of August 2022.
AGAINST
Continue with the previous dual LM rewards proposal with a cut-off date at the end of May 2022.