[PIP-15] Cap Treasury and Reward Stakers

VOTE HERE: https://signal.pickle.finance/#/pickle/proposal/QmURByLzkdd45Ayd72AGR6eqZr9jSxwZRXZzMTagjdK6kd

Following this conversation, this proposal asks to cap the Treasury at $500k and sends the rest to Pickle stakers with respect to a specific schedule.

Namely, a 4 week “bonus” disbursement and then a steady-state disbursement thereafter:

  • W1: 0.5* of excess + prev wk’s profit fees
  • W2: 0.25* of excess + prev wk’s profit fees + excess over cap
  • W3: 0.125* of excess + prev wk’s profit fees + excess over cap
  • W4: 0.125* of excess + prev wk’s profit fees + excess over cap
  • W5+: prev wk’s profit fees + excess over cap

Note: profit fees = 4.5% of jar profits (does not include withdrawal fees)

For illustrative purposes, if we assume a cap excess of $200k, the numbers would look like this:

  • W1: $100k + prev wk’s profit fees
  • W2: $50k + prev wk’s profit fees + excess over cap
  • W3: $25k + prev wk’s profit fees + excess over cap
  • W4: $25k + prev wk’s profit fees + excess over cap
  • W5+: prev wk’s profit fees + excess over cap
11 Likes

To summarize the reasoning for this proposal:

  • Curve whitelisting will necessarily be delayed by at least one or two weeks
  • We have extra capital sitting around not being productive
  • We have only disbursed jar profit to stakers even though the Treasury gained a lot from withdrawal fees recently
  • We want to benefit Pickle stakers, but in a way that doesn’t shock the system too much (or not enough)

We recognize there are drawbacks, however:

  • There is a possibility that ETH/PICKLE LPs would pull out to stake for the high returns
  • This money could have gone to a smart treasury instead (but the details have yet to be worked out)
  • Other suggestions for how this money could have been “better spent”

Please read the previous RFC here for more details.

2 Likes

I don’t know if veCRV are traded anywhere but if so, maybe put in a limit order or at least watch out for opportunities to accumulate

veCRV cannot be freely transferred I’m afraid, they are kind of non-standard in that way.

Yeah excellent stop-gap until the smart treasury, rewards the community for patience etc

3 Likes

As and when there is a large expense eg CRV buy, do you envisage the treasury refilling at 100% of fees until back to $500k or gradual via split between treasury and staking? If the former there could be an APY shock leading to stakers leaving/selling for a while?

2 Likes

Using the numbers provided this would work out to ~0.33 cents per Pickle staked for week 1 and then less after that. I still think this is not an efficient use of funds and does not provide any benefit to the value of Pickle. Saving the funds for a Black Swan event would do much more for investor confidence. Especially after FARM fiasco.

Why is this a drawback? Or in other words - what is the value of having this pool be so liquid, to the point of heavily subsidizing it with new pickles? Everybody is assuming this but I just do not see the value beyond initial fair token distribution. Please bare with me if the answer is obvious.

This is an interesting take! So I assume you have run the numbers and that does not sound too appealing unless you have large hoards of Pickle. Also I assume there will be a fair share of Pickles staked in the Pool for the first couple of week to take advantage of the higher rewards and then once the rewards start to decline the staked pickles will be on the move again! Well, have you thought about how else these could be used? The proposal is a core PIP and up for vote and looks like it has a 80% yes to it. Obviously who doesnt love a little xtra cash on the side i guess!! May be you should put alternate ideas out as to what could be done with the excess cash in the treasury?

As and when there is a large expense eg CRV buy

Gradual split makes more sense to me, but we’ll cross that bridge when we get there.

Low liquidity for a project’s token means high volatility and crazy price swings (both up and down). Liquidity is not the end all be all, but it’s an important piece of a healthy project.

1 Like

Yeah I have suggested the treasury just hold funds. Ideally if the treasury could have enough saved to buy every Pickle at a set price that would be a significant booster to ease investor worries. Even better would if the treasury could farm also, but that may be more risky. I also liked the Smart treasury idea.

1 Like

This has my vote & support.

So far (well, 5hrs ago) only ~4% of the Pickle-ETH pool has jumped into staking. At the moment the APY on LP is still significantly higher so I think concerns about the impact should be unfounded.

1 Like