Low Fee Jars Proposal for Sushi Farming Strategy

Intend:

  1. attract TVL from low cap Sushi farmers
  2. marketing (no/low fee yield aggregator)
  3. experimental purpose to gauge users interest in low fee/low yield options - explore future fee models and see users interest in lower yield farming game

Solutions:
Create Sushi farming strategies with no fee or low fees

Facts:
Sushi farming reward dropped significantly in Harvest and there are 132 million funds in Harvest sushi pools. They are cutting 30% profit and FARM reward is minimum. I seriously thinking Pickle can create a low/no fee jar that gives little or no Pickle reward and still able to attract good amount of TVL if marketing properly. Use ETH-WBTC as an example, farmers getting 6.21% total yield from Harvest (3.99% Sushi+2.22% FARM) and there are 52.42millioj TVL. If users farm directly with Sushi they are getting 6.44% (19.32% on sushi website divided by 3 to account for locked sushi). It’s actually cheaper if farm directly with Sushi! So if we can create a low fee jar, even without Pickle rewards, it’s going to be more yield than FARM, not to mention their inflated APY display.

Fee options and yield:
a). 1% - 6.37%
b). 3% - 6.25%
c). 5% - 6.12%

I think the value for this is to give pickle a chance to acquire some sushi TVL without changing current pickle emission allocation.

With FARM weekly emission cut, it’s going to be funny to see next weeks total yield if they don’t boost the allocation for those pools.

I think 3% performance fee makes sense at least based on today’s stats as it gets similar yield than Harvest and helps to cover the gas fees. It’s a purely TVL/marketing/experimental play

Oh another option… you can replace 3% performance fee with 0.1% withdraw fee too. haven’t got a chance to run the number yet but the point is, farmers gets “free” auto harvest as long as they stay in the platform

For the experimental part, I think it gives Pickle a chance to gauge farmers interest in low fee yield aggregator for low yield farming pools. If it goes well (people actually interested in low fee low yield farming), it prepares Pickle for future fee structure if yield farming becomes a single digit game in the future

Name for the low fee jars
Diet Pickle - dpJars for short
Pickle Jar Lite

There is a need to start PoC experiments and it helps the Pickle team to test the market. Yearn team is doing a lot of PoC at the moment too with their v2 vaults (they are also testing farming Pickle) and all of those PoC strategies help them to determine future strategies. I strongly encourage the Pickle team to consider this proposal as a PoC and those initiatives are going to bring value to Pickle (even if it fails!)

Oh BTW don’t forget we currently have a pJar with no Pickle allocated, charging 27.5% fee and currently still have 800k TVL!

3 Likes

Assuming I get this right… we could compound their 1/3 SUSHI reward and pocket the difference?

“Farm SUSHI with PICKLES - get 33% of your locked SUSHI rewards INSTANTLY in $PICKLE”

and we just dump our 2/3 SUSHI for WETH --> Treasury?

that’s not what I am proposing… and I don’t think we should focus too much on how to get the 2/3 at the moment. The Sushi team has NO plan for the 2/3 sushi distribution yet.

My proposal is a PoC experimental to help

  1. attract TVL from low cap Sushi farmers
  2. marketing (no/low fee yield aggregator)
  3. experimental purpose to gauge users interest in low fee/low yield options to prepare for future single digit yield farming game