[RFC] Switch voting rights from Pickle-ETH LP to Pickle Stakers

THE ISSUE
Ever since Pickle staking was introduced, and particularly since the treasury cap surplus approach was implemented, there has been discontentment among the community about voting rights (or lack thereof). The overall feeling seems to be that the more involved you are with the community, the more likely you are to stake your Pickle, and the more likely you are to want to actively participate in governance.

At the time of writing, 52.9% of Pickle supply was staked (0.4% of which are still in the old pool), 38.2% are in the Pickle Power LP pool, with the remaining 8.9% out in the wild. The ‘flippening’ (Staking > LP) happened ~2 weeks ago ago and the trajectory is continuing. With plans in place to eat into the Pickle Power emission allocation and potentially start emission distribution to stakers, it can be reasonably expected that the trend will accelerate to a point where Pickle Staking significantly outweighs LP.

THE CHALLENGE
There is broad consensus that Pickle Staking should provide governance voting rights. I haven’t seen any community members against this idea.

It’s clear however, through many weeks of discussions, that the engineering required to a) combine LP and Staking voting rights and b) implement any time restraints on staking, is significant if not near impossible.

It is also clear that the proportionate weight of voting rights depending on your position is unclear and would create complexity in an approach that is currently relatively simple.

AN ALTERNATE SOLUTION
If we agree that:

  • Pickle Stakers are generally more involved in active community discussion (not saying LP holders aren’t, just as a broad cohort would be overall less so)
  • The proportion of Pickle in the Staking contract is likely to increase from an already leading position
  • The engineering/formulas of combining LP and Staking rights is overly complicated/difficult/impossible …

Then why not consider a switch of voting rights from 100% Pickle Power LP to 100% Pickle Staking.

IF Pickle retains the quadratic equation when calculating voting rightsthe removal of the LP token factor actually simplifies things. If I have 100 Pickle, I get 10 votes. If I have 10,000 Pickle, I get 100 votes, etc. Following Peachygate this may be a good opportunity to review the quadratic approach to voting rights too.

I propose that we leave aside the idea of locking, time constraints and other complications. Staking your Pickle generates Pickle C (or new token name for clarity?) which provides voting rights.

One further benefit would be the potential for defining appropriate quorum for voting - I realise that currently it is difficult to determine the number of LP tokens per account and therefore the total, but assume with Pickle itself staked on the Pickle Platform it would be feasible.

ISSUES/RISKS

  1. Liquidity Providers should have a say in the governance of the project. This may well be true - I am not across that many different projects but from the few I know, LP generally don’t participate in governance? The approaches seem to be more about “token within the ecosystem”, either staked, locked or delegated. Pickle Staking and the related “profit share” ticks this same box for me.

  2. Risk of short term buys & dumps in order to manipulate voting. While this is in theory an issue, it’s no more so than providing LP (minus a couple of tx). And with the quadratic equation approach the impact of a single whale would be minimised - buying 10k Pickle would only give them 100 votes, unlikely to be sufficient for a majority. Sidenote: the concerns about sybil attacks remain but that is a separate issue.

  3. Proposals that benefit Stakers would end up with skewed viewpoints. True, but no more so than is the case for LP related proposals, currently which actually tend to be the majority of PIPs relating to allocation of rewards.

  4. LP providers pull their liquidity, dump the Pickle … well the first aspect is actually something we have been aiming for through emission reduction for LP. The second I guess is harder to predict - some you would hope will stay, some will stake and yes I am sure some will sell. After the UNI farming ending and TVL movement, maybe the timing is not great?

TLDR
Rather than trying to combine LP and Staking voting rights, switch from LP governance to Staking governance in entirety.

If you have alternative ideas please feel free to put them forwards. This will hopefully be the last change in this respect (at least for a significant time) so it is worth getting right.

Speak now or forever hold your tongue

  • Switch 100% voting rights to PICKLE stakers
  • Maintain status quo of LP voting

0 voters

12 Likes

I agree with this wholeheartedly. I was just getting ready to ask in discord why LP holders are favored over stakers. I decided to participate in staking over LP because it gives me a nice APR and removes my PICKLEs from the circulating supply. My thought has always been that staking is a way to show more of a long term commitment to the protocol vs farming.

5 Likes

I agree but we still need LP and therefore the Pickle Power LP Pool needs to be adequately incentivised. I would vote for 100% staking power, but I also think the newly-empowered stakers should commit to period where LP incentives will not be removed. I don’t know what an appropriate period should be, two weeks?

Agreed.
While a combined voting system would have been nice, making this move is logical given that stakers are more aligned with the protocol.
Since there’s no way this passes a LP vote, it has to be an executive order imo.
Discord voting etc are too gameable with no way to verify skin in the game.

3 Likes

My comment in Discord: If the reason to skip the vote, is because you feel the vote won’t pass, and this is public knowledge, then why not just have the vote? If the vote passes, you don’t set a bad precedent, and if the vote fails you’re in exactly the situation you’re in now (switching governance under the presumption the current one would disapprove.)

3 Likes

A good point.
We could take a vote and see what happens.
If it fails, it’s an added justification for the change.

4 Likes

I made my proposal in Discord and gained some alignment and wanted to share my thoughts here so we can keep track of ideas.

My Proposal: announce a snapshot date/time and have a public vote to determine if voting right should be switched to staking pool

The Issue: currently voting right is only assigned to LP owners and due to technical issue the dev team confirmed they cannot assign voting right to both groups (staking pool and LP). We need to decide which group gets the voting right and based on the recent Discord discussion, there is a group of people in Discord supports to bypass governance process and proceed the change (switch to staking pool) directly. The most popular argument I’ve heard so far is many community member believes staking pool members are better aligned with the long term growth of Pickle and “stakers are GENERALLY more active and involved in the community discussions”. I am not going to argue which group of users are more involved as there is no way for us to know.

Why do I think we should have a public vote and announce the snapshot day/time?

1. By-pass the governance is a really bad move tbh.
As we all know, most community members are proud of the fact that Pickle is the closest to DAO compare to other DeFi projects. Pickle Devs are also vocal about being community driven. Changing the voting right is a EXTREMELY BIG CHANGE to the governance process. Discord discussion seems to believe if we go for a vote, LPs will vote against it because they want to enjoy the voting right by themselves. This is a statement without evidence. How do you know the vote will not pass if you don’t even try?

If the devs and other community members want to take the chance and do a one-off change bypassing governance, it sets a very bad example and really hurt the image of DAO. Who believes a man cheated on his wife will never do it again? it will bring very bad damage to the “community driven” spirit and it is not encouraged. Hence, i propose to have a vote to decide the future of Pickle voting rights.

2. Why do we need to announce a voting snapshot date/time?
Voting is a fair game. As long as a user has Pickle, he/she can decide however he/she wants to allocate the $Pickle. If Pickle staking pool users want their voice to be heard, they can be prepared and move from staking pool to LP and make their votes. They can even take advantage of the quadratic voting system shortage. All legal votes should be counted!

If LPs are really not as engaged with the community, then they won’t notice the announcement and will lose the vote. If that’s the case, then LP users don’t deserve the voting right.

Quote from @dafacto

" If the reason to skip the vote, is because you feel the vote won’t pass, and this is public knowledge, then why not just have the vote? If the vote passes, you don’t set a bad precedent, and if the vote fails you’re in exactly the situation you’re in now (switching governance under the presumption the current one would disapprove.)

There’s no difference between switching under they assumption they’ll say no, and giving them the opportunity to say no."

5 Likes

I also support this going to SIGNAL. I do expect LPs will vote against it BUT maybe we’ll be pleasantly surprised. If we announce the snapshot in advance it will allow stakers to flip into LP and cast their vote. It’s a gas cost for everyone but well worth it for the future governance of our project.

To our LPs (pickle power), give consideration to the future of PICKLE when you cast your vote. We are building a true Robo-fund built on Ethereum & DAO governance. If you believe in this project, you’ll hold & stake PICKLE to vote with the rest of us in the future. I ask you to do what’s best for the long-term growth of PICKLE.

4 Likes

Well, In my case, the ETH I had when I switcharoo’d is sold. Hence to vote, I’d have to buy ETH and now it’s at it’s ATH…
You seem to make a point that if Stakers don’t move back to LP to vote then they are not engaged which I refute.

Let’s see how it goes, I assume most of people who are voting are engaged LPs and can see the bigger picture. I don’t think people who are farming and dumping care much of the vote change.

Hi!

I don’t know, if this is the right place to ask this, but here goes: Why is it, that the $pickle only staking exists in the first place? Why aren’t the staking rewards distributed to the ETH/PICKLE farm? It would make perfect sense to me, and that is, although I staked 95% of my $pickles in the solo track.

On the other hand, I can see that it works out as it is, if the solo staking makes the price of $pickle appreciate enough to make LP-rewards remain high, regardless of reduction of emission.

1 Like

Correct me if I’m wrong everyone but here goes.

Why is it, that the $pickle only staking exists in the first place? Why aren’t the staking rewards distributed to the ETH/PICKLE farm?

Why hold $PICKLE? People need to be incentivised to hold PICKLE, so we had a change in the management (a month ago or so) to distribute the excess treasury (profits from jars) given back to PICKLE holder. Otherwise $PICKLE will be just earned and dumped with no meaning why you should hold it.

I voted yes, would love to see the votes come out.

Quote from @Creat0r

“If LPs are really not as engaged with the community, then they won’t notice the announcement and will lose the vote. If that’s the case, then LP users don’t deserve the voting right.”

Agreed fully.

2 Likes

I’m voting yes with the caveat that everyone remembers the importance of having sufficient liquidity and the higher risk that LPs take on in the form of IL and therefore sufficient rewards remain allocated to the LP pool.

3 Likes

I agree with the sentiment but this must be voted on. I do not wish to bypass governance.

I doubt everyone wants to maintain sufficient rewards. If this goes through the LP pool probably will be cut heavily. Arguments have already been made that we have too much liquidity at the expense of the platform. This is a fine position to have but changing the voting scheme to get it passed? If you want voting rights take the same level of risk as an LP and provide liquidity.

1 Like

I disagree here. On the one hand, if all the true supporters of the project are incurraged to also provide liquidity in order to receive their share of excess treasury, I don’t see why these peop|e would start dumping pickle. In fact, even if the more opportunistic farmers that use to farm-and-dump will get some eth along the way, they would not have to sell 50 % of their yield to compound their interests, keeping the price more stable.

Looking at the price of a token ever only makes sense in regard to the liquidity available. If 90% of $pickle was staked, is there still room for occational dumps? The supporters need to justify their their support by the proverbial skin in the game. IMHO.