Note: This is a Request for Comments (RFC) proposal.
UPDATE: PROPOSAL SUBMITTED FOR VOTE
A vote has been submitted to the Pickle Finance Snapshot voting platform. It will run for 48 hours starting at 6am UTC of September 26th, 2020.
Over the past two weeks since our launch, the community has expressed the desire for:
- An incentive to hold PICKLE tokens;
- A comprehensive governance reform with more community control, and;
- A re-evaluation of the buy and burn strategy.
Today, based on studying the discussions here and on Discord, we (the Pickle core devs) would like to present a proposal to the community for feedback.
Here is a brief exposition of the concerns along with links to forum threads where some of the discussion has taken place.
1. There is no intrinsic reason to hold PICKLEs
Many have pointed out, the only reason to hold PICKLEs right now is to farm them for even more PICKLEs. It is not lost on us that this is tautological at best, and at worst, a house of cards waiting to fall apart.
2. Current governance is not ideal
There is desire for a community-controlled treasury that is not entirely beholden to the original founders of the project. We are only two weeks in, but having a plan for this makes perfect sense if we want to see the project succeed in the long run (and we, the core devs, certainly do).
3. Buy back and burn is not a good strategy
The initial impetus for this strategy was due to the simplicity of implementing it in code. Admittedly, it was a naïve approach, and even back then, there were community members who opposed it. Unfortunately, we did not have the time to research and implement alternative strategies as we rushed to complete the Jars for UNI’s farming launch.
We, the core devs, would like to propose the following changes:
1. Allow staking of PICKLEs to earn a portion of PickleJar profits
The heading here is quite self-explanatory. We want to allow people to stake PICKLEs to get a share of the profits that the Pickle protocol earns. This was heavily inspired by YFI’s approach where YFI holders stake their YFI to vote, and subsequently earn a portion of yVault profits.
The following is taken directly from LearnYearn:
When you stake your $YFI to vote in governance, you earn a percentage of fees that are accumulated from the different Yearn Finance products like Vaults.
These features make $YFI much more than just a governance token.
If this proposal passes, this model would apply to PICKLE as well. Read on for more details.
2. Roadmap towards a community-controlled treasury
The community has demonstrated its interest in the long-term success of the protocol, and deserve more control over the direction of the protocol. That is why we propose the creation of a new treasury, which will eventually be a 5/9 multi-sig account with active community members.
The treasury will receive the bulk of the fees from the Jars (see below) and will start with just the dev team for now, but it is our intention to gradually hand off control to active community members.
This community-controlled treasury will be the dedicated resource for all of Pickle Finance’s expenditures (marketing, bounties, audits - although the initial audit costs will come from the current dev fund as we wait for the treasury to accumulate).
3. Send the bulk of PickleJar fees to the treasury
We propose removing the subsidized gas fee (3%) and buy and burn (1.5%) from the PickleJars. Instead, we will divert all 4.5% of pJar profits to a staking pool where people stake PICKLEs and earn sCRV or whatever tokens the Jar produces as discussed in the first point above.
With the 0.5% withdrawal fee, we propose splitting it into: 0.175% for the dev-team to fund their continued work on Pickle, and 0.325% into the treasury.
As a matter of logistical simplicity, the proposed 4.5% for PICKLE stakers will go directly into the community treasury, at which point the 5/9 multi-sig can decide if all of the 4.5% should be distributed to PICKLE stakers (initially we intend this to be 100%).
The biggest benefit of this proposal is the empowerment of the community-controlled treasury. The treasury can decide how much of its profits to send to PICKLE stakers, and can also decide how much to spend on various expenses relating to the protocol.
This means that instead of a set-in-stone buy and burn of 1.5%, the treasury can decide to execute any of the proposed strategies:
- Buy and hold
- Buy and supply to Uniswap ETH/PICKLE pool
- Buy and make
- Buy and do whatever you want!
Technically, you don’t even need to “buy”, it’s just money in the bank.
We look forward to hearing your comments and how we can further tweak this proposal. We think this proposal will move the project towards a more sustainable future and likely a healthier token price as well (which benefits everyone).
We spent a lot of time studying the community’s ideas before writing this, but do let us know if there are considerations that we have missed. We would like this proposal to evolve towards something the entire community can get behind.