BIP 24 - BADGER BOOST (Multiplier Replacement)

BIP | Badger Improvement Proposals
1

Title: Badger Boost (Current Multiplier Replacement)
Category: Emissions
Goal: Add more utility to the Badger token through introduction of Badger Boost
Scope: Institute Badger Boost which will boost rewards for those holding more badger proportionally to those holding less badger.
Status: Accepted https://snapshot.page/#/badgerdao.eth/proposal/QmXT2s9r8Tu58TekUMF3crUS4ySePxMaAsSERt7nZieHAb

Overview

We want bBADGER and bDIGG (BADGER and DIGG that has been deposited into a sett) to be productive assets. Using something as collateral for a loan for example is a more effective lockup than staking. This lockup takes these assets off the market, which amplifies upward price pressure whenever there is demand. An increase in value in the underlying assets is positive for BadgerDAO as they will always make up a large portion of the treasury. It also means that less units of them can be given out to non-native setts to ensure competitive APY. The Badger Boost is a proposal to create utility and demand for BADGER. To get to that point though there are a number of changes that need to be made which I have

Proposal 1: Remove Staking for Native Setts and reinvest 100% of rewards

Native = Any BADGER or DIGG sett (single asset or LP), non-native = All other setts (ex. all crvBTC setts)

There was A LOT of discussion around this idea and ultimately we think it is the best way forward for a few reasons.

  1. All Sett tokens (bTOKENS) become very composable and users can keep earning rewards. We hope to create more utility for these tokens in the future.
  2. Users no longer miss out on any compounding returns by not claiming because of high gas fees. This is a big issue especially for smaller accounts

Proposal 2: Denominate all rewards in bBADGER and bDIGG

This is a gas saving measure, no claiming and re-staking. It does add a step for LPs but we think with the auto-compounding of 100% of rewards as described in proposal 1 this is an OK tradeoff.

Proposal 3: Create “Badger Balance” and “Digg Balance” calculations, use them for cross asset rewards, and establish destination whitelist procedure.

These will include whitelisted locations where bDIGG, bBADGER or other bTOKENS for native assets may be held, staked, or deposited. When distributing bDIGG to BADGER holders and bBADGER to DIGG holders we cannot re-invest them since its a different asset. We will use the “BADGER Balance” and “DIGG Balance” contracts to determine distribution. This means that native assets being distributed to other native assets will not be broken down by sett. As new use cases are launched for native assets we will need to updated these contracts to account for them so we will put forward a BIP in the future for this process.

Proposal 4: Align BADGER Balance with snapshot voting contract

To keep things in line BADGER Balance will be based off of the current configuration in the snapshot contract and will remain in sync as changes are made.

Proposal 5: Introduce Badger Boost as multiplier replacement

The Badger Boost will apply to all non-native setts. The higher your BADGER Balance and DIGG Balance, the better rewards you get on your non-native setts. This is done through calculating a “Stake Ratio”.

Stake Ratio = [$ value of BADGER Balance + $ value of DIGG Balance] / [$ Value of non-native staked sett positions]

There will be a max multiplier that gives your position weight a boost based on where your Stake ratio falls in relation to all stake ratios.

What this means is that for any addresses staking equal value of non-native setts, the one with the highest Stake Weight (Badger + Digg in whitelisted locations) will get the most rewards.

This will be applied to all non-native setts and be used for the distribution of native assets.

You can see how this looks with sample data here: https://docs.google.com/spreadsheets/d/1EN9jlL31aiwQpOJxcOJa6OXDl9KdFdPNDevRdBuYSq4/edit?usp=sharing

I am suggesting the max multiplier be set to 3, but leaving to a vote. In this scenario those not staking at all will get 50% of the rewards they would otherwise while those with the highest stake ratio will get 150% of the rewards they would otherwise. Here is how it plays out for multipliers 1-10.

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These proposals all work together and we think provide some real benefits the community has been asking for

  • Save gas - You dont miss out on compounding rewards by not claiming due to high gas
  • Benefits to smaller accounts - It is easier to have a good Badger Ratio for smaller accounts. If you have $5,000 in BTC staked you can buy $5,000 of BADGER with low to no slippage. If you have $10 million in BTC staked you would need to buy the entire circulating supply of BADGER to match the smaller stakers ratio
  • Improved composability, use your bBADGER and bDIGG without missing out on rewards or staking bonus

Polls

Proposal 1: Make all native setts 100% compounding rewards?
  • Yes
  • No

0 voters

Proposal 2: Denominate all rewards in bDIGG & bBADGER?
  • Yes
  • No

0 voters

Proposal 3: Create “Badger Balance” and “Digg Balance” contracts, use them for cross asset rewards, and establish destination whitelist procedure
  • Yes
  • No

0 voters

Proposal 4: Use Badger Balance for vote weight in snapshot voting (align voting and rewards calculations)
  • Yes
  • No

0 voters

Proposal 5: Implement BADGER BOOST as current multiplier replacement
  • Yes
  • No

0 voters

Proposal 6: Value for Max BADGER Boost
  • 2
  • 3
  • 4
  • 5
  • 5+

0 voters

Huge thanks to @Mr_Po for extensive discussions on all aspects of this BIP & @DeFiFrog, @mason, @Spadaboom for their valuable contributions.

14 Likes
2

The best thing about the Geyser was that it rewarded long-termism by paying more to badgers who had been staked for longer. I don’t see any time/long term component in the current proposal. Did I miss something?

Long-termism has become an important and valuable part of our culture. If we drop withdraw fees at the end of week 8 and our time based multipliers, we’ve got nothing left to support/cultivate that culture/behaviour.

I also think it is important to reward LP’s for long-termism who maybe don’t also have a lot of BTC to stake beside it in non-native setts. Someone who wants to just LP for DIGG for 6 months should get a sweet multiplier.

30 Likes
3

I’m also not 100% on #4 and what
“To keep things in line BADGER Balance will be based off of the current configuration in the snapshot contract and will remain in sync as changes are made.”

Can someone explain which badger balance this is, and what it is based off now or what else it could be based off?

4 Likes
4

Proposal #3 includes this balance - it’s a contract that sums your balances from multiple positions.

2 Likes
5

I think I have a handle on this but for everyone else could someone formally list the

Native and Non-Native setts both in existence and planned.

Also why is the limit of 3 suggested for the Badger/DIGG Boost parameter? Really more curious whether this has some basis in simulation or analysis or just a number picked from thin air here?

Very much like the 100% reinvest - and basically lumping bBadger and bDIGG rewards from various setts - makes complete sense from a technical and cost savings standpoint.

Thank you.

3 Likes
6

If the MX is too high, newcomers get a really crappy APY and never come.

2 Likes
7

And would there be another way to calculate it? Or is this just basically saying that LP posistion are worth 2x the badger they contain like with governance? If so, maybe it would make sense to clearly state that in the BIP.

1 Like
8

So we lose the time control on how the maximum multiplier can be gained? I mean why not have a high multiplier if it takes someone leaving their stake like 3-6 months to achieve it.?

Does this proposal lose us the time based increase in reward multiplier? I like the idea that the longer one is in the higher the basic multiplier. If this proposal drops the time component - then basically the multiplier will ‘just’ be related to the native tokens you have staked vs. the non-native which can be switched at leisure.

4 Likes
9

The calculation is live and what we use for governance - you can see the contract here: https://etherscan.io/address/0xca1f57ccb9e2ba18c49c873f4e51a5ef65b6e8dd#code

This actually pulls the underlying balances from LPs so you get exactly the credit for how many badger you have claim to, not an approximation.

2 Likes
10

This is an important step in furthering aligning the incentives of Badgers, its users, and BadgerDAO itself. I see the Badger Boost as something similar to veCRV’s boost to their own vaults. Reward those most loyal to your project; incentivize the badgers to contribute and participate.

A pleasure collaborating with the team.

2 Likes
11

Isn’t this just going to turn the whales into super whales? What does this really do for the little guy? The ones who make up most of this community?

14 Likes
12

If badger boost was rewarded to people who locked their LP/bBADGER/bDIGG positions for a period of time, the time component element would be met. I’m also not a big fan of Lock-in and would rather reward long-termisim in all it’s forms, but I think I could vote to approve a BIP that included a time-lock to get multipliers. I won’t vote for a BIP that abandons long-termism flat out.

I can also live with Geysers for a while longer if that takes some time.

8 Likes
13

the badger boost component only applying to non native setts and no longer having any component of time associated to multiplier seems to greatly benefit whales and hurt community members who have been around longer.

i’d like to see all setts (native & non native) receiving boosts and introduce similar to the digg distribution a weighted boost that accounts for both total rewards as well as time staked.

8 Likes
14

I am of the same mind. These multipliers should be earned not just given.

10 Likes
15

In my opinion, in this particular case adding rewards based on time commitment wouldn’t add value.

For example, if Badger BOOST was based on Badger held during the last 30 days:

  1. Setts wouldn’t be attractive for newcomers. A newcomer would come and see 1/3 of the reward and get out. Thus the buying pressure from newcomers would be lower.

  2. It also wouldn’t reflect the commitment well. That is, if you’ve staked for a month and then quit, you would still be getting elevated rewards while holding no Badger for quite some time.

Also, when it comes to native Setts long-termism, it is being greatly rewarded by high APYs + compounded rewards. As compounding high APY rewards leads to exponential growth.

So a DIGG LP who’s been an LP for 6 months already is in quite a privileged position compared to a newcomer by being a recipient of his/her share of more than 50% of token supply distribution.
I see no valid reason to further add to that privilege - it would at the end of the day hurt that LP as it would turn the newcomers away.

Time-based Badger BOOST would make the value of holding Badger less evident.
In my opinion, if you can buy X amount of Badger and get Y % APY boost on your farming position, that’s a much better user experience than when you have to also wait Z amount of time before you get it.

6 Likes
16
  1. We could allow new depositors to timelock their deposits for the time to reach max multiplier and then give them the max multiplier directly upon deposit.
  2. Agreed, we need to figure out a better way to measure long-termism.

The point is, if some project offers a higher APY than badger one day, all things being equal, someone would likely move to chase that APY. If they’ve been at badger for a while and are getting a 3x multiplier, they are less likely to move. High APY’s are usually based on short emissions periods like our own, it would be nice not to have everyone jumping ship to chase each new one.

There’s also a cultural/community element. Our last 6 weeks have been defined by decisions/conversations about multipliers and long-termism and reminding each other to stay in the game or not miss out. Each new farming opportunity launches lots of conversations about the best way to play the game. Badger has a game like aesthetic as well.

In the end the value of cryptocurrency is backed by belief and community. I think the long-termist focus we have built on badger is unique, cool and worth preserving and will serve the DAO very well in the long term.

Your concerns are valid, but let’s find a way to meet them and keep our focus on staying in the game.

If there comes a point when these systems/structures are clearly hurting us/limiting our growth/scaring away new people we can talk about changing them. Right now it’s working good, why abandon it?

7 Likes
17

I have a question regarding the bDIGG compounded rewards: If you were to stake DIGG, that amount is exposed to rebase. However, and correct me if I’m wrong, your bDIGG rewards would not be. So this would be very helpful during negative rebases, but hurtful during positive rebases?

18

The amount of DIGG per bDIGG will change each night based on rebase and the price of bDIGG will float and not be pegged to bitcoin. So you may always get the same bDIGG rewards, but how much it’s worth in DIGG is variable.

1 Like
19

I apologize, but I need an example with numbers for me to understand…thank you for the response though.

1 Like
20

Maybe jump over to discord and ask for a clarification?

1 Like