I’m Sean, relatively new to the ecosystem of Terra, but have fallen in love with it immediately. Out of the entire ecosystem, the most intriguing protocol to me, is pylon. However, through using pylon gateway to stake for things like Nexus token and Valkyrie, I came to realize that there could be a potential improvement made to our gateway system.
Right now, the gateway system allows all users to directly stake their $UST into the pool (for most live projects), to gain access to the continuous airdrop of tokens, however, this doesn’t really seem to incentive people to actually buy and hold $MINE (I could be wrong, please do correct me if I am), I’m wondering would it be a good idea, to implement a threshold here, my suggestions indicate 3 options:
Only allow users to stake and earn rewards when their stake is $MINE, this greatly increases the buying pressure of $MINE.
People could stake their $UST into the pool too, but it has to be in combination with $MINE, but there is a minimum ratio of how much $MINE you have to stake, say for e.g., for $1000 worth of staking, at least $500 of those is from $MINE.
All people are entitled to deposit their stake entirely in $UST, if they have staked past a minimum threshold of $MINE tokens, this is already implemented in the distribution of $MINE tokens in the gateway, but I honestly think this creates a long term selling pressure, as currently staking rewards you with $MINE token, and that only increases total supply over the long term, I reckon the top 2 options are better for the tokenmoics purposes.
I think through implementing option 1/2, we could greatly increase the buying pressure of $MINE, and hence create a more favourable price action, and eventually benefit holders of $MINE, while the 3rd option could also play an interesting role, in allowing more people to get into the dAPP at a faster pace.
Interesting! New to the community so didn’t really read that many threads just yet, thank you for the information, Rocky!
Totally agree with you, I think people should also take into consideration of the implementation of this mechanism to our price action in the long term, if people are incentivised to hold $MINE because of all the exciting protocols that will be coming to the platform and distributing their tokens, then ultimately, the same people who hold $MINE would also benefit from its price action! It might hinder the protocol in the short term as people might find it troublesome to swap $UST to $MINE, but I honestly think it’s too much a worry, adding a simple tab that allows the swap should probably solve the problem.
I see XDEFI implementing the idea of staking at least 10,000 $MINE tokens in order to participate, exciting and a good start!
I think we should cap the deposit amount without any MINE staked. I can understand someone would walk away if he want to throw 1k and minimum MINE requirement is also worth 1k. That’s additional risk he has to take in “riskless” investment. But if you want to put 10k on the table, then 1k worth of MINE doesn’t seem like a big deal, I’d say it’s acceptable risk. Want to invest 20k? Ok, 2k worth of MINE you need to stake etc…
I really like the idea of adjusting Pylon Pools to create more benefits for $Mine stakers. However, I think creating $Mine staking requirements is the wrong way to go about it.
Pylon Pools are lossless investments. By requiring people to stake $Mine for a duration to utilise the pool they are no longer a lossless investment as they can lose money through $Mine.
If the adjustment is to just require X amount of $Mine to be staked prior to utilising a pool, then all we will do is create price volatility. That is, people will just by $Mine before they contribute to the pool and after contributing they will sell their $Mine. We see this type of issue across lots of platforms.
By creating a barrier (staking $Mine) to joining Pylon Pools, we reduce the amount of people who use the pools. Given 100% of $Mine stakers APR and treasury rewards come via yields from these Pylon Pools, it makes sense to have as many people as possible use them. Note: If you’re not yet aware, a % of the yield from the pools is distributed to Pylon which is then used to benefit $Mine stakers. Currently it is the source of $UST that buys $Mine and distributes it to $Mine stakers, i.e., the 30% APR. It is now going to be sent to the treasury which is governed by $Mine stakers, we now get to decide what we do with the UST, for example Treasury Swaps.
It is obvious that the most desired outcome for $Mine stakers is Pylon Swaps. Obviously, lots of projects are coming to Pylon and are looking to mostly use Pylon Pools. We should therefore try to find a solution where projects looking to use Pylon Pools can do so whilst also aiming to provide $Mine stakers with something a close as possible to Pylon Swaps. This is where Treasury Swaps come into play. Note: A detailed forum post about the function and setup of the treasury is in the works.
Treasury Swaps would mean the treasury (governed and owned by $Mine stakers) trades some of its UST for the project’s tokens. This would hopefully be done in similar terms to VCs. Thus, cheaper prices and longer lock/vesting. We should aim to have most, if not all projects using Pylon Pools do some level of Treasury Swaps with us.
This approach has a range of benefits.
Projects know that their tokens are going into the hands of $Mine stakers who are known/established long term holders (as this is how the treasury rewards will likely work).
Projects can allow as many people as possible to join the pools without any barrier to entry.
Projects know that the Pylon community will support them long term and they will become long term investors.
$Mine stakers gain the maximum possible yield from the projects Pylon pools.
Loyal $Mine stakers get access to projects tokens in a similar way to Pylon Swaps.
Both $Mine stakers and launching projects incentives are better aligned. That being, both parties now want the project to prosper long term.
so if no mine staked you get 1:1 deposit earning.
when staking you get like 10% or 20% more rewards. This is not forced MINE staking, but an extra.
you can even build in some extra % per staked amount, just an example:
1000 MINE staked = 5% more returns on top of the normal UST return