[PIP-9] Introduce Wrapped Bitcoin Jars

Intro

Thank you all for kicking off and contributing to this discussion here: Wrapped Bitcoin Pickle Jar.

It is clear that many of you would like to see PickleJars having strategies involving BTC-based tokens. Accordingly, we have introduced this Snapshot proposal which is now open for voting.

The Proposed Solution

We, the core devs, propose adding PickleJars with the following strategies:

  1. an ETH/wBTC Jar which farms UNI and re-invests them to earn more ETH/wBTC LP tokens; and
  2. a crvRenWBTC Jar which farms CRV and re-invests them to earn more crvRenWBTC tokens.

We are aware that introducing BTC-based PickleJars would signal our departure from dealing only with stablecoins. However, we believe that this would nonetheless be a fruitful opportunity for the following reasons:

  1. it would bring in additional revenue to those staking PICKLE tokens and to the Treasury (per the recently passed PIP-8); and
  2. it aligns with our broader goal to help synthetic assets return to peg (stablecoins being just one example of a synthetic asset). This is opens up a much wider array of opportunites, as aptly explained by @jjdubs here.

Outstanding Issues

We recognize that one of the reasons behind the great participation in our current pJars (pJar 0 and the pJar 0.69s) is because our users can double dip with PICKLE farming rewards. At this time, the allocation of the PICKLE farming rewards will remain unchanged, meaning that these BTC-based PickleJars will not immediately be entitled to PICKLE rewards.

We would like the community’s input on if/how the PICKLE rewards should be split if this proposal passes. Currently, the percentage allocation of PICKLE rewards are approximately:

  • Pickle Power (PICKLE/ETH LPs) - 75%
  • psCRV (from staking sCRV in pJar 0) - 4%
  • pUNDAI (from staking DAI/ETH in pJar 0.69a) - 1%
  • pUNISDC (from staking USDC/ETH in pJar 0.69b) - 9.5%
  • pUNIUSDT (from staking USDT/ETH in pJar 0.69C) - 10.5%

Also, keep in mind that the APYs for these pools is affected by TVL in each pJar (which can be seen on the Jars page). We welcome comments and thoughts on what an appropriate re-distribution would be.

9 Likes

Awesome, more pJars is always good!

How do you guys feel about the BTC collateral being custodied by the Ren team?

1 Like

Thanks for this write up, Larry!

I like the idea of adding both of these jar strategies! I think it makes sense to allow for BTC bulls to benefit from the pickle platform.

As you aptly pointed out, there is a large portion of our TVL that is here because of the additional pickle distribution benefits. If these jars were created and had no pickle emissions dedicated to them, they would probably attract a relatively small amount of capital.

Right now we are the most trusted platform that allows for native token incentivized participation in jar (or vault) passive strategies. I think that for something like this to be successful, we would have to dedicate a portion of our pickle emissions to it.

So what should this portion be?
PICKLE/ETH is critical to our platform as it helps us maintain the price of pickles. If we cut into this too deeply, prices could bleed. Does that mean we couldn’t bring it down to, say, 70%? No, not necessarily, but we have to be careful here.

I think it’s reasonable to assume that emissions will effectively help manage pool size. If the APY on any one pool is too high, capital will reallocate.

My “gut” here is to evenly pull from all places. This would make the effects practically imperceptible to the average user. Perhaps we aim for 2.5% to each of the pools? New distribution would be:
pickle / eth = 71.25%
psCRV = 3.8%
pUNIDAI = 0.95%
pUNIUSDC = 9.025%
pUNIUSDT = 9.975%
wBTC / ETH = 2.5%
crvRENWBTC = 2.5%

Interested to hear your thoughts - sorry for the rambling style here.

1 Like

As someone who is highly incentivized to see the success of a BTC Pickle Pool I am only interested, as @Larry_Cucumber mentioned, if I can also obtain pickle rewards.

As of right now wBTC in the renBTC Curve pool is earning ~15% APY. With a 2.5x boost from locking up CRV that is about ~38% APY. For me to bring liquidity to Pickle and lock up value, I must be receiving more than 38% APY for it to be worth my time. Further, I must be receiving much more than 38% to compensate for the risk of bring significant money into the currently unaudited Pickle Jar.

This is to say, if you want to unlock the next tranche of TVL for Pickle, Bitcoiners (including myself) will come provided you give them a risk-adjusted incentive to do so. They are looking for reasons to leave Curve, you must give them one.

Now I personally would rather have $PICKLE over $CRV as I feel Pickle is an appreciating asset, and CRV, well…you all already know how I feel about that.

As far as reward amount: I would like to see 15% rewards for the renBTC pool drawn from Pickle Power, 0.69b, and 0.69c.

This will adequately incentize TVL to come over and is a whole new marketing angle/audience/optics you have yet to explore. With a move like this (appropriately promoted) you are now branching beyond the DeFi audience and speaking to a whole different group of people who have yet to speak to.

As I mentioned in the original forum post, you will have excellent optics as the second viable option for Bitcoiners to go to beyond Curve.

Cheers,
:eggplant:

3 Likes

Trying to understand how this helps with the on peg good, off peg bad mission of PICKLE? Or is the Mission going to change as well so that it becomes another yield farming protocol?

Might be good to introduce dynamic pickle rewards.

  • This can be done the normal way: I.e.outside the suicide pool, 25% of pickle issuance is sent to the remaining pJars based on TVL on a pro-rata basis.

  • Or this can be done on an inverse basis to incentivize the uptake of new pJars. I.e. if a pJar has 10% of assets it receives (1-.10) = 90% of Pickle issuance. If a pJar has 90% of TVL, it receives 10% of pickle issuance.

As I mentioned in our earlier comment, this could be a good opportunity to provide set clarity around pickle issuance to pJars as well, and to start declining issuance to the suicide pool.

“We also suggest clarity around rewards for this pool. For instance, 75% of rewards flow to this pool for the next 52 weeks, potentially declining at 1% per week or some cadence here. The pros are this will prevent the price from tanking as users stay in the pool. The cons are this reduces the ability to incentivize pJar LPs although the slow decline of issuance to this pool could be redirected to pJar incentives for a gradual reward transition. Also issuance rewards are declining anyway which was a great change (congrats on the new SNX style issuance schedule)”

[RFC] Incentivizing Pickle Holding and Governance Reform

2 Likes

What it COULD do is letz me stake pcrvRenWSBTC and auto-add the farming proceeds to the pcrvPlain3andSUSD (or whatever the correct names are, but you get the meaning).

Thus, I could only stake pcrvRenWSBTC if I lready had a USD “good peg good” involvement.

I for one (Bitcoin Maxi at heart, really) would love to keep my BTC hodl’d instead of converting it to stablecoins but still would love to reap benefits of PICKLE.