Proposal: Use protocol owned ETH to buy and burn BNT from the markets

[ohweoh]

• BNT is $1 and whatever X token is $2 in a bancor pool. (deficit in the pool)
• If BNT pumps to $2 a token. this will match the same price as the other X $2 token (pool is now equal)
• The pool can then be closed as an arb bot or trader will trade X token for BNT filling the gap in the pool.

This has happened for quite a few pools already this year as a bunch have closed on v3.

[ImshermanentLoss]

@olchemist

But reading the discussion above I still get the impression we try to stretch the sale in order to prevent pumping BNT. Why, if a high BNT price is beneficial?

I believe that relates to the perspectives and biases of people involved in the process. For some, their loyalty lies with Bancor itself, for others it lies with Bancor LPs affected by the deficit. For the latter group it’s clearly the case that relative BNT price performance is the most important factor for them, bar none, because it’s the ONLY mechanism whereby their deficits can be recovered. For the former group it isn’t quite so simple.

[glenn]

An update has been provided in this post:

Proposal to Use POL to Reduce B3 Deficits

The majority of the initial sale that swapped ETH to BNT happened yesterday. You can see the TX(s) in this contract: if you want to visualize some of this occurring, then there is a Dune dashboard here that has this info https://dune.com/queries/3302196/5529956 A screenshot of the dashboard data is here: [image]

[olchemist]

@ImshermanentLoss

I believe that relates to the perspectives and biases of people involved in the process. For some, their loyalty lies with Bancor itself, for others it lies with Bancor LPs affected by the deficit. For the latter group it’s clearly the case that relative BNT price performance is the most important factor for them, bar none, because it’s the ONLY mechanism whereby their deficits can be recovered. For the former group it isn’t quite so simple.

So in effect, this whole exercise does not really benefit the LPs affected by the deficit. Selling POL did nothing to the deficit so far. BNT keeps bleeding out against the general market. It pumps with ETH but dumps even harder.

With current fees from Carbon it will take decades to burn all that excess BNT.

Being long BNT/EHT is a shit trade to be locked in.