Name BIP 9: Parameterize and create a DAO infrastructure around LP sett reward/reinvestment ratios.
category: Sett Vault
High Level: Allow DAO to adjust reward/reinvestment ratio from 50/50 in order to better support token price, meet market conditions, and learn how to govern ratios.
Right now the Uni Badger/BTC vault, and soon a number of new vaults are setup to direct 50% of emissions through the geyser/Badgertree for earnings and the other 50% are used to buy more of the underlying position. This means that 25% of emissions to each LP are being sold and market price for WBTC(or whatever the other pair may be).
The goal of the reinvestment is to continue to increase liquidity. The goal of the rewards is to incentivise long-term investment through rewards multipliers.
When market conditions are good, a 50/50 ratio may make sense here. With bitcoin mooning and badger down, it seems to me like this creates downward price pressure nor is it a good investment, and it would make a lot more sense to maybe direct 80% of the emissions to rewards and only 20 to LP reinvestment, but I’m no expert. This becomes more pronounced as we add more lps that all have emissions that are being used for reinvestment.
Answering a question such as a simple ratio can be a complex thing for a group of people to do. A successful DAO learns how to do this. Uniswap is a good example of what happens when a DAO gets too big before learning how to make more complex decisions in a collaborative way.
I suggest that we vote to form a committee who will discuss/study this and create BIP’s suggesting changes when sensible. The committee should consist of 3 people, each of whom should be elected by a BIP. For now, committee members should hold their place until they resign, or someone proposes a new BIP with a sufficient quorum to replace them and wins. Each committee member should be paid 75 badger per month.
So there are 2 questions here:
Once basic sentiment and interest is determined, I will add a few more polls about specific parameters and details.