Indy token staking fees have undergone structural changes.
Daily interest on CDPs now flows to the DAO, constituting the majority of rewards the protocol generates, as evident from the Dapp’s daily interest on CDPs. Ideally, these rewards should be distributed back to INDY stakers proportionally.
Redemptions for iassets re-pegging are currently disabled, resulting in consistent zero earnings for stakers.
Stakers earn a 0.5% fee for minting iassets. However, with minimal minting activity due to upfront fees and existing iassets in circulation, there’s little incentive for CDPs in V2.
The 2% INDY stakers receive from CDP liquidations has historically provided meager returns stays, but the largest rewards of the 2% from the closing or lowering a CDP is now eliminated, and current fee structures do not promise better rewards. INDY rewards are continually sold off every epoch as ADA elsewhere in the ecosystem offers superior returns.
If selling INDY for ADA remains more lucrative than staking INDY, despite governance voting considerations, new users will be deterred from the protocol. Despite the accumulation of ADA in the DAO wallet, INDY is consistently sold off as rewards. Even during crucial governance votes, although whales may manipulate prices, holding INDY post-vote remains unattractive. This is not conducive to the protocol’s success.
I believe we should prioritize sharing these interests with INDY stakers. If INDY becomes more appealing to hold and stake, its price will reflect that, mitigating concerns about daily interest accrued by CDPs. Continuously selling off the price creates a downward spiral, in my opinion. Therefore, INDY stakers and the token should be the primary focus for value creation. Unfortunately, this change does not represent a net positive for INDY stakers.