Proposal
Use the following allocation of the 1.25M ALGOs Defi boost over the BANK percentage allocation.
| Contract | BANK allocation | proposed allocation | estimated APR |
|---|---|---|---|
| USDC L&E | 26.75% | 26.75% | 10.8% |
| USDT L&E | 2.00% | 2.00% | 5% |
| ALGO Borrow | 0.50% | 2% | 0.52% |
| USDC Borrow | 0.50% | 0.5% | 0.1% |
| goBTC Borrow | 0.25% | 0% | 0% |
| goETH Borrow | 0.25% | 0% | 0% |
| USDT Borrow | 0.25% | 0.25% | 0.87% |
| STBL2 USDC Market Supply | 32.50% | 32.50% | 6.2% |
| STBL2 ALGO Staking | 8.00% | 9.50% | 45.9% |
| STBL2 goBTC Staking | 2.00% | 4.00% | 31.3% |
| STBL2 goETH Staking | 2.00% | 2.50% | 34.7% |
| USDC ALGO Staking | 7.00% | 7.00% | 36% |
| ALGO Vault | 10.00% | 5.00% | 0.08% |
| STBL2 BANK Staking | 4.00% | 4.00% | 81.9% |
| ALGO BANK Staking | 4.00% | 4.00% | 73.9% |
Temperature Check: here
Estimates based on liquidity levels on March 29th (before the period ended),1A = 0.23$ and the pay out cycle being April 21st till 31st June (70 days). Note that these are different from the ones posted in the Temperature check because I used 90 days in the APR calculation there.
Goals
- Focus a bit more on DEX liquidity incentivizes
- Stay competitive with other DEXs who will use their ALGOs for farming purposes
- Reduce borrow APR slightly for people who want to liquify their vALGO by borrowing ALGO
Rationale
-
people are incentivized to use the vault naturally so the vault allocation can be reduced. additionally, almost all of these incentives goes to VCs
-
goETH/goBTC borrow APR was always pretty low and BANK incentives should be enough. And the rewards ALGO APR for borrowing would have been relatively high which might have lead to rehypothecation.
-
ALGO-STBL2 is the most important LP on Algofi besides USDC-STBL2 especially after the introduction of the STBL2 router (more info on the router here). People who have ALGO are able to use the STBL2 liquidity present on the DEX without the need to actually buy STBL2. And because of the design of lending pools incentivizing this LP might lead to more supply of ALGO in the lending protocol and less ALGO borrow APR.
-
ALGO farming rewards for BANK pairs are already estimated to be quite high, so they dont need additional percentages. The BANK rewards for these pools are on a similar APR level so currently people would get >120% APR paid in BANK + ALGO combined for farming those LPs.
-
Bring ALGO rewards for goBTC and goETH farm to the same level.
If you have any other ideas or dont like how i shifted the percentages, lets discuss it till the 6th when the vote needs get online so its finished when the period sign up ends!