Hello and thank you @overanalyser for working on this proposal.
It is great that the Coop is looking at intrinsic productivity within Indices, we agree that this is a feature that will make all Coop products much more attractive to a certain niche of users focused on incrementing gains. And Defi Pulse is eager to cooperate with the Coop & other methodologists to advance this feature not only for DPI & PAY, but for DATA & LDI as well.
There have been numerous proposals & ideas before on Intrinsic Productivity whether within a single product or a dual product system:
Notable are these 2 posts (1 & 2) by @overanalyser from January which provide a great path as well as insights on the benefits & challenges of intrinsic productivity.
@Kiba also proposed a simple intrinsic productivity back in April, and here one of the main blockers seems to have been on the Engineering side as mentioned by @dylan at the time.
DG1 for Intrinsic productivity was positively voted on by the community, but was not followed through, we assume for those same technical reasons.
One main point that pops up when looking at the Index Composition. Based on the presentation given to the community, and regardless of the methodology, this product at launch seems to significantly overlap with both DPI at 60% & DATA at 24% (Both LINK & BAT are arguably the DATA tokens with some of the largest communities in the space).
In addition, we also see even more possibilities for overlap on a cursory evaluation of the tokens that make up the difference:
BNT: Low liquidity on DEXes supported currently by Set infrastructure. (Probably the main reason why it’s not on DPI now).
0x: Low liquidity on DEXes supported by Set infrastructure.
Some other tokens that make up the difference seem to have liquidity issues, past a certain scale, which won’t allow this index to scale or will need to be removed.
Based on all the above, it seems that the main questions to ask here, considering the costs involved in launching & maintaining a new index:
Does it make good use of coop ressources to create a new product that has a very similar composition to DPI + DATA?
Don’t you think that we should strengthen our existing (leading) indices by implementing a generalised solution, and activate intrinsic productivity across all Coop products?
@overanalyser You’ve always been the one pushing for intrinsic productivity on DPI - let’s continue what you started and benefit from it across all Coop products.