Extending the Liquidity Mining Program

Following up from @setoshi’s post and synthesizing the poll responses, we think a sensible set of initial parameters for the dynamic DPI/ETH liquidity mining program would look like the following:

Epoch Length: 12PM PDT on December 7th, 2020 to 12PM PDT on January 7th, 2021.

Target Pool Size: $30M to provide $150k buys at 1% Slippage.

Target APY: 30%

Required $INDEX: At a 20-day rolling average price of $6.47, we would need to distribute 115920 INDEX tokens, representing 1.15% of the total supply

Following this proposal, we will:

  • Initiate an IIP to ratify the program extension
  • If the IIP is passed, the Staking Contract will be funded with the requisite $INDEX

If you say no, please respond why and/or what you’d like to change about it.

Should we move forward with a DPI/ETH LM program with these parameters?
  • Yes
  • No

0 voters

1 Like

Would stakers need to unstake and restake to a new contract, or does it just roll over?

My calculation is 57,960/31 = 1,870 INDEX per day vs 15,000 in the current programme (~12.5%)

this doesn’t make sense, does it? if the current APY is circa 60% then reducing it to 30% would require a 50% adjustment, not 87.5% as per your comment. what am I missing?

Current APY is 60% on $44 M, we are targeting less liquidity and lower APY.

I’m curious but why less liquidity? Don’t we want as much liquidity as possible?

Stalkers would not need to restake, as I believe we can just top up the rewards

EDIT: We may need to deploy a new contract where re-staking is required.

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Lots of liquidity means less slippage for buyers (it will also allow arbitrage to be profitable at lower difference to NAV as they can make bigger trades without slippage).

However, if you want to buy lots of DPI, it can be cheaper to purchase all 11 underlying tokens and use the issue function in the Sets contracts.

So, the largest Uniswap trades are generally less than $50 K.

So, if we say we are happy with $30 M in the pool. Then we can reduce INDEX rewards, and keep the INDEX for the future.