TLDR:We take all unclaimed indy rewards that have expired from the airdrop and from being earned, and we send them to Minswap to be added to the ada/indy farm.
Anyone that has claimed $indy rewards from the protocol may have noticed that there is an “epoch time” section which shows the epoch rewards were earned, and an “expiration epoch” which shows when those indy rewards “expire” and are no longer claimable. This is a 90 day grace period to allow users to accumulate rewards to save on transaction fees, taxes, and other reasons.
What happens with the unclaimed rewards such as those from the airdrop or earn rewards?
Nothing, for now. The indy continues to sit there until we, the dao, decide what to do with them.
Minswap has the largest trading pool of ada/indy by TVL mostly in part to the Liquidity Bootstrap Event that was hosted in November. Participating in this granted boosted farming rewards for liquidity providers. However, this boosted pool will be coming to an end soon as it was only set to last for 6 months.
So I propose this: We take all unclaimed indy rewards that have expired from the airdrop and from being earned and we send them to Minswap. Doing this will entice liquidity to remain in the pool once the LBE farm has ended, as well as encourage new liquidity providers to join the pool as an alternative to earning indy outside of staking it.
Edit This is the total unclaimed expired indy. 5078.082995
This initiative will not happen until the LBE has officially ended, but we can get the ball rolling and begin the conversation with Minswap and get unclaimed rewards over to them, once this has passed.
Some should be distributed to the governance holders or stability pool holders too because they are taking the most risk… so please add stability pool deligators!
Going off the numbers you provided, I don’t think there is enough unclaimed rewards to justify providing it to LPs. What are you going to do earn 0.0000001 Indy? I think it would make more sense to reward active governance participants. Maybe the unclaimed portion can be split between all staked wallets that have voted on the latest proposal prior to distribution (without any notice of distribution timing).
Theres over 2 million indy currently staked in the protocol. Giving them 5k would be the same as your .000001 example.
So as of now we are averaging 50-80 indy expiring every epoch. All of which can be sent directly from Sundae reward wallet straight to minswap farm without any interaction on our part.
Liquidity is going to leave the pool once the LBE over. Without a doubt that will happen. Providing the expired indy rewards to liquidity pool farmers(albeit no matter how big or small) is better option than governance stakers that are alreasy earning indy and ada at a higher apr than liquidity providers receive.
Yea I guess it’s a wash either way, no real gains to be made on it for either group. I’m not against LPs earning Indy, if this went to a vote as is I would favor it. I suggest distributing the rewards to active voters ONLY to maybe reduce the amount that is being split because I doubt every staked wallet is actively voting, but maybe I’m wrong. I’m thinking something like, instead of a weighted allocation based on amount of Indy staked, we would split the unclaimed rewards 1 for 1 to all wallets that vote on the last proposal before the time of distribution. (Ex: 100 wallets voted: each wallet receives 50 Indy) (5,000 wallets voted: each wallet receives 1 Indy)
My thoughts exactly. If the unclaimed $Indy went to stakers or voters, most of it would go to the $Indy whales. It would just be dust to most DAO members. What could really hurt the protocol though is if a bunch of liquidity disappears all of the sudden. Not good for price stability or growing interest and TVL. It’s not much but we could add to it later by vote when we have access to more funds.
Hey, thanks for giving it a thought! I have two questions:
What is the potential impact of this proposal on $INDY price? My amateur thinking is that DAO sends 5000 tokens, they are added to the LP via Zap (i.e. 2500 tokens are sold for $ADA), thus that will create sell pressure and the price will go down notably… so i’d support this proposal provided DAO adds $INDY along with $ADA (i.e. without selling 50% of $INDY). I might miss something so please feel free to correct me.
Would it be better just to burn those tokens from the platform’s economics perspective?
No friend, you have this wrong. We send the unclaimed rewards to minswap to be added to the farming rewards for people already providing liquidity. This is in an effort to retain some of liquidity already there instead of everyone leaving once the boosted farming rewards end.
This proposal isn’t so that the DAO adds liquidity to the ada/indy pair on Minswap. We already do that.
Ah, I see thanks. For some reason it was not coming clearly for me in the original message. Makes sense… as long as there is an overall compelling case to accumulate $INDY (otherwise higher rewards → higher sell pressure since no big reason to hold on to $INDY). So far it is a) voting weight; c) earning some $ADA while staking; b) collateral… Going forward the unclaimed epoch amounts will be smaller so should not create any significant impact
Correct. We are not sending over massive amounts of $indy to the farm, just what goes unclaimed which will get smaller and smaller as time goes on. Even if the small amount provides but a small bump up to the farming APR, it is better than letting unclaimed $indy sit in reward wallets doing nothing.
To your other point, $indy will prove its worth as time marches on. No doubts there.
What about using this INDY to create protocol owned LP on Minswap (can use zap feature to create INDY/ADA LP)? I believe INDY creates enough traffic for Minswap to warrant Minswap adding it to its farms for MIN once the lunch bowl payouts end. The amount of LP earning MIN and ADA would grow over time to create funds for the DAO along with supporting liquidity.