Hi HeelHook, I can’t comment on all of your questions (perhaps someone from Balancer Labs can chime in on the development focused Q’s), but in terms of Matic: the main things are that there’s been a lot of user demand for L2 deployments, BAL rewards were being matched with MATIC & it offers an interesting platform to run experiments with multi-asset pools that would be harder to run on the ETH main net due to gas & liquidity fragmentation (liquidity fragmentation isn’t a worry when designing pools for Matic, as traders can hop as many times as they want without really adding to the transaction cost).
Liquidity fragmentation between different networks is something to be weary of, but I think at the moment there’s more to be gained from having a Polygon presence than that cost.
In terms of rewards, lock-ups, etc… It’s all about better aligning the incentives of LPs with BAL holders, so more LPs get involved in governance, and to help us attract LPs with a long view rather than short view on things.
Hi! Smart Money think for years. They dont care what will happens next week or next month. so to inproove our tokenomics we need obviously option A . the market is not yet ready for options, adoption is slow and organic. can we be liquidity providers for traders, and at the same time have additional rewards for not being able to withdraw money from the pool? I think it’s cool! that is, we reduce the sell pressure, but our capital benefits traders. I’m not a technician guy, can we do this? and the Aave asset manager is on its way. can we combine these 3 possibilities in one pool? and of course people will have the opportunity to locked their amounds for different periods of time. a good step to increase TVL.
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I see option A and B being the exact same use case here. They achieve the same outcome on a broad level but option A has less of an alignment for a “higher” payout if there is a collective KPI all LP’s are working towards.
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Bringing this back to life since I saw the other proposal to implement a locking system similar to Curve. That approach provides additional incentive to liquidity providers outside just the payout of CRV. CRV stays on the platform, gives a boost to liquidity pools, and creates a less liquid supply of the CRV token which helps put upward pressure on the price of the CRV token.
SUMMARY
I think BAL price appreciation should get some attention for the sake of drawing in new LPs. There is no real need to burn BAL since there is a finite amount, but you can do other things to reduce the supply in open circulation.
1. Simple Re-investment
Give LPs the option to re-invest their BAL distribution rather than only having the choice to claim BAL. I think this concept could be implemented in a few ways:
- Each pool could have an underlying allocation of BAL which would become a part of the larger pool, adding to the potential return of the pool as a whole. This BAL would also be locked and thus reduce the liquid supply of BAL.
- If LPs didn’t want exposure to BAL for some reason you could either do point in the bullet directly below or create a side pool just for BAL which is probably more akin to the proposal around a Curve like mechanism
- BAL selected to be re-invested would be swapped into the underlying assets and increase the LPs pool share
- A sub-thought on this would be allowing the LP to select another pool to convert their BAL into, a way to gain exposure to other coins without paying gas fees to claim and swap
- Similar to one of the points above, BAL distribution timing could also be amended to quarterly or annually (LP choice) which would allow you to do a few things with the BAL in the meantime, which leads into my next area
2. Asset Lending
- LPs could lock their BAL in a separate pool or this would work with the other methods above, but the point is the BAL could be deposited to lending providers such as AAVE to earn yield from borrowers while locked away. This could also take additional BAL out of circulation, if the borrower ends up owing more BAL (assuming they have swapped into another coin and have to buy back more BAL). I suppose part of this concept was covered by the Asset Manager idea I saw, but this would only apply to BAL for now rather than all the other pools’ underlying assets.
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if i have that button i would like that. for 80/20 Bal/Eth is a perfect option!
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