[RFC] Taper down emissions to 0.1 PICKLEs/block rather than sharp drop

:mega: by @leekuanjew: “vote is live as PIP-47. No options have been removed, suggestions have been incorporated from the RFC into the final proposal.”


As proposed on Discord, I’d like to officially nominate a gradual ramp to 0.1 PICKLE/block overall emissions over the remaining weeks of this year, rather than dropping it to 0.1 all at once as currently scheduled.

@leekuanjew edit: “I have added some an option and voting for temperature checking. Keep in mind if the proposal goes to Snapshot, we will add some prose to make it formal without changing options unless schedules have expired. This RFC should get 20 votes before we proceed to Snapshot voting”.

Option A – 4-week schedule

  • Start – 0.3000 PICKLEs/block
  • Dec 12 – 0.2500
  • Dec 19 – 0.2000
  • Dec 26 – 0.1500
  • Jan 1, 2022 – 0.1000

Option B – 7-week schedule

  • Start – 0.3000 PICKLEs/block
  • Nov 21 - 0.2714
  • Nov 28 - 0.2429
  • Dec 5 - 0.2143
  • Dec 12 - 0.1857
  • Dec 19 - 0.1571
  • Dec 26 - 0.1286
  • Jan 1, 2022 - 0.1000

Option C – 8-week schedule

  • Start - 0.3000 PICKLEs/block
  • Nov 14 - 0.2750
  • Nov 21 - 0.2500
  • Nov 28 - 0.2250
  • Dec 5 - 0.2000
  • Dec 12 - 0.1750
  • Dec 19 -0.1500
  • Dec 26 - 0.1250
  • Jan 1, 2022 - 0.1000
What is your preferred schedule to reduce overall PICKLE emissions?
    • Option A: 4 weeks
    • Option B: 7 weeks
    • Option C: 8 weeks
    • Do nothing (sharp drop to 0.1 PICKLEs/block on Jan 1, 2022)
    • Other (write in comments)

0 voters

What overall emission level would you like to be at after the reduction?
    • 0.1 PICKLE/block (current scheduled rate for Jan 1, 2022)
    • 0.15 PICKLE/block
    • 0.2 PICKLE/block
    • 0.3 PICKLE/block
    • Other (write in comments)

0 voters

6 Likes

I’d go with the 8 week schedule.

3 Likes

Don’t think you can go wrong with either one, but it will depend on how fast we can go from this to pip voted for. We have 10 days to complete the process to begin the 8 week.

Edit: looks like 3 options now, definitely prefer longer ramp down to shorter.

4 Likes

I’ve become unsure regarding the move to 0.1/block as we continue to expand into L2s. Emissions are useful on mainnet because of the cost of entering and leaving a jar/farm, and they are needed to some degree on L2s to help incentivize TVL. Dropping to 0.1/block would spread our emissions pretty thin across all the chains.

With that said, the increase to 0.3/block did not have the impact we expected, and I don’t think that level of inflation is beneficial to the protocol. Like it or not, there are quite a few people who don’t look at the fundamentals of a protocol to gauge investment opportunity; big number = big ape.

There seems to be two groups of people, those wishing to remain at 0.3/block, and those wishing to return to 0.1/block. I propose a compromise of either 0.2/block or 0.15/block. Either of these options give us more leeway to determine the appropriate distribution to each chain.

1 Like

It would be a shame to begin our OKEx launch with slashed rewards. But since we do not have a concrete launch date yet at the moment (it is around the corner anyways), I would lean towards the longest possible ramp down period. Which will also result in marginally less overall PICKLEs emitted this year compared to a sharp drop by end of year.

1 Like

For what it’s worth, it looks like our launch onto OEC will be without PICKLE emissions at all as they haven’t managed to set up PICKLEK for us!

But, the same logic applies when/if we look to add Fantom, Harmony, other-new-hot-chain.

Sorry folks, I tried to edit the poll after some new discussion but it nuked all the votes. Please revote.

1 Like

I suggest 0.05 Pickle/Block after reduction to compensate for overinflating supply with the emission increase. I have yet to see any example of a yield aggregator that gave less emissions and saw the token price go to 0. If auto compounding is Pickle’s sales pitch then people will deposit for that. Assuming that contracts work properly, there may be a slight fluctuation in revenue but Pickle price appreciation will drive interest in farming which will drive deposits, etc.

2 Likes

as I have suggested in #DILLDAO, I would like to propose a rather slower emission drop with 0.2 pickle per block on 1 Jan 2022, and 0.1 pickle per block as per 1 Mar 2022.

2 Likes

+1, I can’t edit the poll without losing all the responses. Let’s hope we can add that option (16 weeks to 0.1) in the snapshot vote.

I think adding a new option for every single idea will mean we never reach consensus. Options need to be limited based on sentiment of the DAO in discord. Continually adding options after the fact makes it harder to consider the poll genuine.

Adding new options after the fact resets the poll.
I don’t think it’s bad to add a few variants when going from the forum → snapshot. Snapshot too is immutable AFAIK, so it’s not like it will change after people start voting on it.
I agree in general that we shouldn’t rush to add everyone’s ideas, but I think the 16 week idea is a good one.

2 Likes

I support the 8 week option. Says I need to be “trust_level_1” to vote – maybe voicing my support will get me in there?

(nope it did not)

1 Like

Getting back down to .1 quickly and smoothly is much better for Dill holders. Pickle trades at 2x buy-back pressure, so price should pump to compensate emission drops. A several week ramp will make this process seamless to yields. Support 8 week or even 7 if we don’t move fast enough with votes.

Call me old fashioned but long and slow is far better than short and quick, voted 8 weeks reduction in emissions

1 Like

I’m a fan of this idea. At least this way we can monitor any impact on TVL and price.

2 Likes

@pipickle your suggestion of 0.05 $PICKLE /block has been added to the Snapshot binding poll.

@sevenz your suggestion of 16 weeks has been added to the Snapshot binding poll.

Echoing essentially what I said in Discord regarding my thoughts on PIP-47 and why I’m very concerned about the current direction of the vote. In short, I believe that a reduction to 0.05 PICKLEs/block would be damaging to the protocol and that emissions should remain at 0.3 until we have reliable data that an emissions decrease would overall be beneficial to the protocol.

Token emissions are necessary for yield aggregators to attract TVL (which is without a doubt our lifeblood). More important now than ever as we wish to aggressively pursue opportunities on popular chains (currently working on another), is that we have enough emissions (i.e. bonus APY) to attract deposits to our Jars even when the cost for users to manually compound is nearly 0. A lot of DILL holders here want to decrease PICKLE emissions to the point that the token is deflationary. I totally understand that sentiment, but I think it’s misguided to look to emissions as a vehicle for that purpose (despite it being a very salient consideration). I think a decrease to 0.05 or even 0.1 PICKLEs/block would in fact have the very opposite effect. Let’s have a look at what the future might look like…

  • In order to sustain the same APR, PICKLE price would have to increase by SIX TIMES its current price to do so, which is not a realistic expectation
  • With a lower APR, TVL will inevitably decrease - this leads to lower profits for PICKLE buybacks which I fear flips PICKLE back to being an inflationary token, contrary to what everyone here wants

Our current emissions at 0.3/block results in emissions of about 700k PICKLEs per year, or $9M, which, with half our $10M annualized revenues being used to perform buybacks, we’re on a good trajectory to achieve this objective. We’re doing really well right now, so I urge us to stay the course and focus on building great products, expanding the team, improving awareness, etc to blow past these numbers. The current approach carries WAY too much risk for an unknown benefit.

PICKLE emissions are the most powerful lever we can pull for influencing desired deposit behaviours from market participants, as we saw form the recent SCCOC vote that shifted rewards from Polygon to Arbitrum (and within Polygon to prune low-performing Jars). We pretty much lose that entirely, and with OEC as the most recent example of what a world with little or no emissions looks like (~15k TVL since launching), we are facing an existential risk.

Here are some examples of how emission cuts have harmed other protocols:

  • CherrySwap: initiated an emission cut around 19/20 October and you can see that their TVL has been bleeding since (JSwap overtook Cherry in TVL as a result)
  • Autofarm: ended emissions on 21 OCtober and TVL plummeted from $1B to $500M immediately after the emissions were slashed

3 Likes