Proposal: Increase ICHI Co-investment from 350k to 700k + 0.3% Trading Fee

DAO Archive (SUBMITTED)
1

This proposal is expected to appear on Snapshot for voting on August 15, 2021 8:00 AM EST. Make sure to stake your vBNT for voting before this date and time to participate in the DAO decision.

TL;DR

  • Increase ICHI co-investment to 700k BNT from 350k BNT
  • Lower ICHI trading fee to 0.3%

Background

ICHI was whitelisted on April 26th, 2021 with an overwhelming response of 51% quorum and 97.41% for votes. ICHI coinvestment was increased to 350k BNT on June 10, 2021 with 54% quorum and 99.85% for votes.

Soon after, ICHI launched V2 of its platform which has supported stablecoins for the 1inch, Filecoin, Fuse, and 88MPH communities. ICHI’s oneToken Factory, audited by Quantstamp and Solidified, deployed a Decentralized Monetary Authority (DMA) for each community stablecoin with a total of $30M TVL supported by the system.

ICHI plans to create and bootstrap a oneBNT (stablecoin minted with BNT) for the Bancor community as soon as Bancor announces the availability of shadow tokens.

Fee Decrease Justification

The ICHI fee was increased from 0.2% to 1% in the June 10th proposal as an experiment. This resulted in a 80-90% decrease in Bancor trading volume and a lower APR for the pool. In short, the experiment failed to increase total trading fees. As a next step, we should lower the fee to be more competitive with Sushiswap, 1INCH, and Uniswap by lowering the fee to 0.3%. This is still 50% higher than the original 0.2% fee.

Coinvestment Justification

ICHI liquidity on Bancor is now at parity with ICHI liquidity on Sushiswap because of the last coinvestment increase but there is only space available for 3,898 more ICHI. ICHI currently provides a 46% APY to this pool via xICHI rewards. An increase in co-investment to 700k BNT will enable Bancor liquidity to surpass ICHI liquidity on other AMMs.

ICHI News Highlights Since Last Proposal

5 Likes
2

Makes complete sense to me, in general 1% just seems to be a bad number since people set their slippage tolerance around there and most bancour routed trades touch at least two pools (i.e. swap eth for bnt then bnt for ichi). As far as the co-investment increase I would certainly like to be the number one pool for ICHI and the rewards they give out on the pair through their own incentives are very juicy. appreciate you guys as always will vote for this.

Screen Shot 2021-08-12 at 1.03.16 PM
Screen Shot 2021-08-12 at 1.03.16 PM1920×951 71.8 KB

4 Likes
3

Thank you for your support and analysis! We can’t wait for joint rewards so this can be in the Bancor UI. Also, nice use of dark mode on your screenshot!

3 Likes
4

Co-investments seems reasonable to me and I am gladly for it if it is going to make us the deepest pool. I don’t remember if this is the case, but does ICHI also have a portion of their treasury on Bancor?

High trading fees have typically not bode well for us and only work towards our advantage when we are the only source of liquidity (or have a very large moat). A reduction to .3% will certainly help with routing more trades here. We currently don’t have dune analytics stats to look at volume/fees for the ICHI pool since it is not in the price table but it should be there in the next few days hopefully.

Very cool, looking forward to it.

1 Like