I think it makes sense to pull from staking rewards more than it does from pools that have no Adel or Akro. Platform use ought to be our highest priority. Curve, Aave are what the Delphi platform was designed to provide, a yield aggregator.
Delphi historically hasn’t sold itself as a yield farm of itself, but as a yield aggregator of DeFi collectively. Curve pools are actively creating value, as are AAVE pools, they’re lending to borrowers, they’re providing liquidity for stable coin swaps and flash loans. Those pools are highly lucrative and for non-powerusers, they’re unachievable. These pools are the lifeblood of the platform because this is where fees can be charged and rightfully so because we are providing a service for those who otherwise wouldn’t be able to capitalize on the opportunity.
Staking Akro and Adel is too early. Contrary to the previous paragraph, these pools provide no economic benefit to the platform, yet they receive the highest total allocation for rewards of Akro and Adel tokens. There is no way to fee these pools because there is no outside value being gained, or drawn into the platform. What are the stakers providing that is uniquely gained by staking? A large lockup of tokens not circulating in the market. This is exactly what we are trying not to achieve right? This is why we are trying to increase liquidity in pools. This proposal seeks to reduce the number of pools. This seems backwards to me as we are bound to lose liquidity, perhaps just powerusers who see the opportunity that balancer provides, but liquidity that provides value to the platform. We can charge fees on balancer pools as it draws value from outside of Delphi. Yes this provides less incentives for DeFi natives and degens, and powerusers. Which, Delphi has historically not targeted as it’s user base.
Delphi has been pension & retirement aimed or even in the most generous light as a gateway to investing in crypto for everyone. It aims for a fiat onramp, eliminating the need for metamask, ledger nano, seed phrases, crypto wallets, and even the user to partake on chain for themselves. This market is where fees come from, fees is where token inherent value comes from in the way that is documented. Token inherent value will provide stability in token volume and price and the price will align itself based on the incentive to hold it: fees. As the fees become more agreeable relative to price the more demand increases and then more supply will follow i.e. tokens will find their way into liquidity pools.
By attempting to find stability through rewards mechanisms we offer ourselves up as prey to those yield farming pump and dumps. Somehow we appear to be competition… when we try to compete. The tokenomics don’t line up with platform delivery right now. Maybe we cut all rewards, let the price plummet, crash and burn. Those who stick around are rewarded by incredibly low cost for tokens, which translates to higher weight in governance as they worked for and believed in the protocol when it was in it’s early stages. This is in direct opposition to what is happening now, the greatest incentives are for keeping your tokens locked in unprofitable staking contracts being a leech off of other’s risk while providing nothing towards protocol profitability or what cannot be called community members as you’re not if you’re a leech bleeding out those you expect to drag you out of what you’ve been bleeding dry.
I don’t feel like remaining unbiased and polite about this again. So there ya go. Just trying to shed light on the actual issues, please don’t take offense if you didn’t understand, just attempting to increase understanding. If you’re offended: https://youtu.be/BiqDZlAZygU a pleasant talk about how you should fight for my right to offend you and you’re right to offend me.
We hope to see the vote on Snapshot in the coming days.