[RFC] PICKLE < > COVER reward mining

Summary

DeFi hacks and security breaches in the crypto space have been increasing in the recent days. This topic aims to discuss the opportunity for Pickle to provide incentives to participate in Cover’s shield mining.

Cover Protocol [COVER]

Cover Protocol is a protocol that is focused on protecting and covering the DeFi community in the unfortunate event of a hack, bug, exploit and or economic manipulation attack. The coverage does not require KYC, is fungible, infinitely scalable and the price of coverage is determined by the market.

Proposal

To allow Pickle Treasury to allocate a portion of the funds towards the Cover reward mining and thus making the CLAIM and NOCLAIM coverage price as affordable as possible. DeFi users of Pickle Protocol will then have the opportunity get cheap coverage to stay protected.

We are planning to start small and progressively top-up should there be demand for coverage. We are proposing to spend $25k to $100k worth of Pickles a month to incentivize Pickle coverage on Cover reward mining.

Some math:
A monthly recurring payments of $25,000 will get us around $625,000 coverage over a year.
A monthly recurring payments of $50,000 will get us around $1,250,000 coverage over a year.
A monthly recurring payments of $100,000 will get us around $2,500,000 coverage over a year.

Additional Information

Cover reward mining program: https://app.coverprotocol.com/app/rewards
Cover user guide: CovToken Reward Mining - Cover Protocol

Please let us know your inputs below:

  • $25,000 worth of Pickles
  • $50,000 worth of Pickles
  • $100,000 worth of Pickles
  • Do nothing

0 voters

6 Likes

It is always beneficial to provide an additional sense of security to users. I would like to better understand if this is a 1 time cost or an ongoing cost. Also what is the period of coverage?
I have not studied Cover. Thus some additional context about the additional costs and opportunities for users leveraging it would be beneficial.
Nevertheless, i believe in investing in the Pickle Protocol and insurance is a part of that objective.

2 Likes

Thanks Jomari! In my eagerness to post the proposal, I have left out the recurring cost and the period of coverage. See the edits and appreciate your inputs.

2 Likes

I’m a big fan of Cover’s design and would fully support efforts to promote a liquid market.

I also think this would step-up our marketing efforts and show how we as a community have matured and are moving forwards responsibly, making efforts to protect our users.

I haven’t read much about COVER, but what happen with the funds if withing a year there is no hack?

Burnt like a wind or? Maybe I should read what they do first.

It depends which coverage are you providing liquidity for CLAIM or NOCLAIM.

One example (not great example) that you can refer to is the previous claim filed for pDAI jar…

2 Likes

I am not too familiar with Cover but seems we are not actually buying coverage with that money, but instead subsidizing other people to buy coverage for themselves. That means, were something like the Evil Jar hack to happen again, our community / the victims will still want us to provide relief for it from Treasury resources and our Treasury would not be able to claim from cover to meet the shortfall.

What would it cost to actually cover us? Say, $1,250,000 / mth.

1 Like

I voted to do nothing:
For me the rules of DeFi and of crypto in general are to assume one’s “investment choices”.

Regarding the protocol, I think it’s up to the developers to make their Dapps and strategies as secure as possible, and mentioning the risks in their use.

As a user of services, it is I who decide whether or not to “insure” myself on the risks induced by my own choices.

Finally, still in my opinion, if the treasury wants to guarantee its liquidity, it must agree internally and inform people.

1 Like

I prefer buy back everymonth for $100,000 Pickles,Collect the Pickles together.
If there is a lost again.Give Pickles to the People who lost their money.

Well shouldn’t this discussion include a “what we can afford study” as well?
We are currently generating good income from degen farms and have some emissions we could divert from the Pool 2, but the degen farms could dry up for us very quickly.
Wouldn’t it make sense to include a dynamic function in here to say "we will divert a static amount x of pickles minted to cover + a dynamic amount y(bought back pickles) depending on the protocols revenues?

I think it doesn’t make sense to put ourselves in a static position with a static number in this highly dynamic environment.

6 Likes

It’s a great idea with a lot of potential, more from a marketing perspective to broaden our reach than actually providing effective coverage ($1.2M annually for $2.5M in coverage is too expensive imo).

I voted for $25K. Just starting the program would achieve the marketing objective, and we can always increase it later based on demand.

5 Likes

insurance premium WAY too high.
WAY WAY.

if you’d come to my door tryna sell me to insure my house for 100k yearly, I’d laugh you out my property.

3 Likes

I have voted to do nothing.

I feel pickle treasury can eventually (with more TVL) be able to fund its own insurance fund to cover our jars and farms. if we allocate a suitable percentage into a Pickle Security Fund (PSF) it can build up over time and eventually will provide some cover for users.

With more TVL it makes it more affordable obviously…
Even if we rather continue with a corn distribution to any affected jars and create a Pickle Corn Fund (PCF) and continuously input 50 000dai for users with corn to redeem

  • I feel working on our corn repayment system would cancel our need for Cover *

PS Congrats on our Three new appointments wishing you guys the best and thanks for the work you guys have put into pickle, keep it up!

3 Likes

Agreed with @0xBoxer on this. Building this with dynamic aspects from ground up will help us adjust as necessary to market conditions. In terms of marketing, I am not sure the 25% will do a lot, but the premium does not make sense for effective coverage here, as @yyctrader mentioned. With a dynamic strategy based on what we can afford, we can adjust as needed in the future.

2 Likes

Snapshot vote is now live with three options: Snapshot