Better late than never tho
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To be clear, we are looking at Arbitrum as well. I agree with your point about being late to Polygon and believe that by contrast, we have a somewhat unique opportunity to be early to Arbitrum. But Polygon is a natural first choice because it is a known quantity - there are already a lot of users there who have been clamoring for us to deploy - and because the team offered some incentive matching to help bootstrap our liquidity. These options are not mutually exclusive as many protocols are now branching out to various chains and roll-ups.
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I am just concerned about the capital allocation (human and financial) and possible outcomes. I am a somewhat active user of polygon (mainly for YF opportunities) but already moved back 40% of that capital to L1 once those opportunities faded.
Some funds remain sticky as far as incentives are there but how much a 3rd AMM can do? I donāt think we can have many USDC/ETH pools and so on without having too much overlap.
Again, if capital allocation is minimal, sure, but I would probably reconsider total BAL allocation and maybe go bigger for arbitrum.
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Iād like to suggest an idea for the rewards to be distributed using UMAās new KPI option. The idea is a novel way to help align reward receivers with the protocol of giving out the rewards. There are a few reasons why this idea makes sense for new rewards programs but a quick overview of how the Options work.
A rewards team will place their reward token (e.g. BAL) in the option contract and mint the Options. The receivers of the reward will get the option as a reward. At a given expiry, the options will unlock the underlying rewards (BAL) depending on the outcome of the KPI. For example, if the goal or KPI is to reach $1M of liquidity and the rewards for this is $500 000. If the $1M of liquidity is reached then the rewards payout the full $500 000. But if the goal is not met the rewards payout is a measure of how close to the goal the protocol got - e.g. if $800 000 of liquidity was reached then the payout would be $400 000 in rewards. These numbers are arbitrary and the KPI and payouts can be adjusted for the specific use but the mechanism is powerful.
Doing this makes LPās stick around longer to get the extra payout for reaching the KPI. The team issuing the rewards has a more aligned mechanism for their rewards. Win-win
2 useful bits of resources I have found that demonstrate how these can use used are:
UMAās own TVL KPI
Tweet thread of reward ideas using KPI options.
I see KPI options as a novel new way of ushering in a āRewards 2.0ā era and remove some of the pump and dump LPing we have seen in the past. Using KPI options is agnostic of any chain or scaling solutions
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but I mean it didnāt really help UMA grow their TVL did it? are there any success metrics associated with projects doing this?
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This is true but what actually happened from UMAās airdrop was we formed the super umans. It brought our community together under a united goal to help inform more communities about KPI options and how they can be used. The UMA uTVL airdrop certainly did not have the desired financial success but i think market conditions also played a HUGE role in that. As we grow and experiment with this new airdrop method more we can find out what is working and what needs to be changed. I think the basic concept is brilliant though - give your community incentive to help grow Balancerās TVL.
Does look kinda interesting to me, could be something to experiment with down the line. Looking at UMAās KPI tokens I think part of the problem they have is that the actions they want people to take to grow their TVL are more complicated than for Balancer (deposit in a pool). The other issue is that the airdrop to wider defi was too small financially speaking unless UMA grew massively, probably works better in our context as part of LM rewards than it does in theirs.
To make it work youād probably have to do it on a rolling basis, where some % of LM rewards each week are issued as options that expire in 3 months time. Youāre then actively encouraging every LP to promote Balancer to others. The option is then either not claimable until it expires, or untradeable so you donāt create a liquid market for it negating some of the benefit.
I am generally pro us exploring avenues to get people to be more aligned with long term interests of Balancer though as it helps build community, plus with social marketing. And this could be one of those.
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@chandlerdekock @poopster
Iām a fan of the KPI options idea in general, and this is a great discussion to have on this forum, but itās outside the scope of this proposal. If someone would like to get that conversation started in a separate thread, please do so; Iām sure the conversation will take some time and there will be logistical barriers to sort out before any implementation would be ready.
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I was planning to create a thread around aligning incentives between liquidity providers and long term interests of Balancer better, havenāt had a chance in the last week with the LM focus but totally agree this is definitely not something to be combined with the proposal being discussed here (hope thereās no confusion there).
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Thanks for your reply ser - agree, we need to create a separate thread for this.
Exactly right.
You can choose those who already have been involved in Discord, Discourse, Twitter, Telegram , ectā¦ Gather some talent from the community members (you would be surprised at the skills you can leverage from the community ).
Create explainer videos for the new people or gain new people that are to afraid to enter a pool for fear of not knowing how it works and the process involved.
Create pre made tweets for members to tweet out to the masses, create some new shwag, anyway to market Balancer and help people familiarize themselves with Balancer as well.
Those saying it did not work for UMA is like saying May 19th never happened. Positions were liquidated , people were pulling out of the pools and trading their synthetic tokens back in for collateral. Guess what , the Umabills are all in the Balancer pools so everyone in crypto took a hit. When the 19th happens your TVL is not going to shoot up and fully recover in a month. Balancer was at $51.24483 April 20th 5:30 AM last time I bought it. Nope, SRY the very last time was May 4th 1:49.05 am $71.01281. So saying KPIās had failed isnāt exactly true. Feel free to see the SuperUMAns over at UMAās Discord. The community that has developed because of a"failed" KPI Options.
The SuperUMAns are putting out videos every week , creating shwag, memes, posting to Elon Musk on twitter about UMAās space insurance, supporting hackathon, scheduling calls for themselves, having trivia nights, taking a Harvard course together, planning new kpi options, ectā¦ Itās a community thatās come together and itās crazy over there.
At Balancer we can use it for whatever goals we need to achieve. It doesnt have to be the TVL , any goal. Air drop to those who are already involved in the community to prevent dumping. No whales because they can be air dropped for certain stages or levels. For instance you are in the top 50 discord contributors you receive 120 kpi tokens, top 50 Discourse contributor 90 tokens, addresses that voted every time 60 kpi tokens, ect.
I think it would be a great way to build the community and reach a goal together. Become a tight knitted community and have fun. People onboarding to have fun because they can see it on discord , twitter ect. I think it benefits everyone involved. I would definitely vote yes if put up for a vote.I am a member / holder of UMA and a member / holder here. Ive first handedly seen what it did for the SuperUMAns .
Why canāt it be done here?
It canā¦everyone here is great, willing to help each other , sharing information, explaining how things work ,and educating people that post a question. Even just on this platform right here, I see it, you see it. Imagine taking that comradery and willingness to help one another and others to another level. Bring the people together and they will build. Let the people build together and they will succeed. Thank you for your time.
Weāre getting towards the end of the period we had allocated rewards for now. Weād need a new proposal to continue offering BAL rewards on Polygon. What are peopleās thoughts?
āIf approved, the Ballers will immediately begin designing pools and assigning the BAL + MATIC rewards. As mentioned, the MATIC rewards would last for 8 weeks ($5M total over 8 weeks) and a minimum of 25,000 BAL per week would last for 8 weeks. After that, the Ballers can decide to adjust that number up or down (with community input!).ā
Sounds like we donāt need another proposal?
Iām just looking forward to the end of the MATIC airdrops. I had so many complaints about lower rewards from one week to the other but especially no rewards at all.
Not sure we need a vote or not as pointed out by Davis, either way, the current BAL allocation sounds good to me.
They should be fixed this week, theyāre going to use Disperse like weāre using for the QI & BAL, for what itās worth.
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