PIP-30 Reallocation of PICKLE Rewards

[chimaera]

Introduction

We recently announced three new jars:

1. stETHCRV
2. MIS-USDT
3. BAS-DAI (coming very soon)

And now we have a fourth coming online very soon!
4. yveCRV

To attract new users and TVL to these new Jars we would like to allocate a proportion of Pickle emissions.

Proposal

Presently, the allocation of PICKLE rewards is as follows:

PICKLE/ETH: 64%
pSUSHIMICUSDT: 6%
pUNIBACDAI: 6%
p3CRV: 4%
pSUSHIDAI (Sushi ETH/DAI LP): 4%
pSUSHIUSDC (Sushi ETH/USDC LP): 4%
pSUSHIUSDT (Sushi ETH/USDT LP): 4%
pSUSHIWBTC (Sushi ETH/WBTC LP): 4%
pSUSHIYFI (Sushi ETH/YFI LP): 4%

The proposed new distribution is as follows:

PICKLE/ETH: 60%
pMICUSDT: 4%
pUNIBACDAI: 4%
p3CRV: 2%
pSUSHIDAI (ETH/DAI LP): 3%
pSUSHIUSDC (ETH/USDC LP): 2%
pSUSHIUSDT (ETH/USDT LP): 2%
pSUSHIWBTC (ETH/WBTC LP): 2%
pSUSHIYFI (ETH/YFI LP): 3%
pstETHCRV 4%
pMISUSDT 4%
pBASv2DAI 4%
pyveCRV 6%

Discussion

Pickle relies on new users and new TVL being deposited for its revenue. High APY Jars are particularly important and the success of such Jars has recently enabled strong Treasury growth (including Pickle buy-backs) and new team hires to drive the project forwards.

We all know that in the near future, DILL will be utilised for deciding the Pickle emission distribution however we need Pickle-ETH LP holders to vote this time. We recognise that the proposed emission schedule shaves a little more off the allocation however the impact on the overall APY is expected to be minimal, particularly compared to the situation yesterday/last week with a lower Pickle price.

Speed is off the essence with this one so please discuss and vote below. Snapshot will be put up for 24hrs following sufficient discussion/signalling here.

PIP-30 re-distribute Pickle emissions

• Proceed to Snapshot
• Do nothing

[2weiX]

pointing out the obvious and drawing a contentious conclusion:

Jars with such humonguous APYs such as BIC BAS MIC MIS don’t really need PICKLE boost to be attractive. They are Treasury-net-proftable as-is. For small-time farmers the additional PICKLE probably don’t even make up for the two extra transactions of staking/unstaking the pJar token (not to mention the miniscule amounts of PICKLEs that then need to be sold in yet another transaction).

I suggest: Remove (or not even introduce) PICKLE incentives for all algostable Jars and/or all Jars with APY > 1000%. Just adding cream to butter, imho (and yes I just made that up).

[These numbers are just guesstimates. I would also be fine with shifting a percent or two between those Jars that then actually receive PICKLE, but you get the idea. I am more than happy to refer to a post I made a while back where I introduce a logic to distribute PICKLE allocation based on both TVL and Treasury earnings.]

In addition to that, I have shaved off a bit of PICKLE rewards for POOL2.
I know this proposal also sucks for POOL2 holders, and I have an easier time disallocating PICKLE from them because I am not in this pool, but any soft-incentive to remove PICKLE/ETH from this pool now rather than later will help price in the current and upcoming price discovery phase.

[Squanchy]

This is a way better approach imho.
However I think as they gave pickles to those algo-stables it is hard to take it back now…

[Slash]

Good work guys…

A while back I was advocating for not removing incentives form PicklePower… But after some time with my thoughts an reading all the valid arguments, it seems to be the right thing to do.

Now with SPTreasury acting as a lp on balancer really helps Pickle not rely on uniswap lp as much.

I think we should consider a new dynamic reward system.
eg
We have a stable 80% of rewards that is readjustable when Pickle adds a new jar through snapshot vote. The other 20% adjusted weekly via vote or like 2weiX mentioned if it could be automated where it allocates percetages according to each jars profitability/TVL/Treasury earnings.

I prefer 2weiX readjustment and I’d say you could even slash another 4-6% off PicklePower.
And yes I am a lp for pickle, but that 6% could pull more TVL towards Pickle and right now that’s what we need With dill around the corner.

[Hassle.Free]

I agree, do not proceed as suggested and give the allocations a make-over.

[2weiX]

precursory rough estimate.

• stETH Jar is estimated to grab 1 MLN
• the yveCRC Jar is not even in there yet
• the SUSHI vested rewards is normalized with the other profit estimations as 1/4 of the displayed Jar APY (20% of gross APY)
• the parameter “favor APY/TVL” is heavily favoring Treasury Profitable Jars over “dumb TVL” jars (with a quota of 7/3)
• Pool2 only gets 45% of PICKLE emission

“other than that”, these are just about the right numbeers imho.

[akirillo]

i think there’s an argument to be made for having PICKLE rewards for high-APY jars. these jars attract many users, and as such have considerable TVL. if this is where a large portion of users’ funds lie, should we not reward this chunk of our constituency w/ exposure to PICKLE & subsequent ability to vote?

[chimaera]

Appreciate and to some extent share your thoughts on this. You are right, the high APY Jars don’t need Pickle emissions to boost that APY in the same way some of the others do. But the reason they have an allocation and why we recommend they keep one is because the Pickle emissions on top provide a reason for people to move their funds. Without a Pickle incentive, why would they deposit in our Jars vs doing it themselves (gas benefits aside for smaller players) or competitors such as Harvest? In short, these Pickle emissions provide marketability to our Jars.

It’s also important to recognise that such Jars are super profitable for us. The revenue generated from a high APY Jar can outweigh the rest combined, and so are deserving of every effort to attract users. As we saw in @leekuanjew 's excellent mTVL thread, there’s a big difference between the Jars in terms of productive TVL.

[2weiX]

I can not disagree with this in general, but the marginal utility of allocating scarce PICKLE rewards to these farms is, at best, marginal

In addition to that, the added gains are just that, too - marginal at best.

I merely want to point out that there is considerable TVL that earns steady income from other Jars that need to stick to Pickle. The degen farms attract aggressive yield-hoppers, they will come without the PICKLE incentive added. So it is not only a matter of “looks” but also a matter to smartly allocate the only resource that we have to spend and spare.

If the Stable-Algo craze dies off, we are scambling for TVL. We need a broad base of users for our PICKLEs that are holding, locking, voting, boosting. Quickly moving Degen TVL will not lock up PICKLE. They’re in it for the short(er) term. In fintech startups, this would be the highest risk group for “churn”, and too much churn kills.

Long-term, sticky “customers” will lock, and, if necessary buy another 100 PICKLE to get that 1.5x boost.

[2weiX]

google link to calculator, make your own copy

PICKLE APY Distribution.xlsx

[frytofu]

for sure there is a strategy in between where the latest-craze strats get compensated with pickles to attract users, but we can still continue to incentivize a diversity of deposits to smooth out TVL fluctuations.

for the bigGER brained briners here to figure out!