Dudemyguy @shadow

Can you outline the consequences of just letting it naturally reduce via OIP-18? We have a decent amount of runway, and the supply growth is still healthy.

Remember there's opportunity cost here there should be an award proportional to the amount of risk holders are taking on and given the high price volatility and rapidly changing liquidity I still believe there a lot of risk to investing in OHM. Not to mention that it sort of punishes new ohmies who bought in recently.

I support this project 100%. The community is amazing and I'm sure the team works extremely hard, but I'm still unclear about the proposed benefits of this reduction.

Having to collect $2M in RFV via bond sales has been sustainable so far, right? What are we getting by reducing the rewards rate other than runway?

      Gregg mate, you're still early! We are still part of a solid project giving us outsized returns.

        what a joke, OIP-18 is already a joke, now this.

          Saoish feel free to propose something you think is better

            i-feel-so-al-ohm I think there's a general misunderstanding about OIP-18.

            There is no natural decrease thru OIP-18. Proposals like OIP-63 are the "natural decreases" as a result of OIP-18. That framework only formalizes our guard rails, but the goal isn't to run head first into the guard rails.

            Some various benefits of having lower APY:

            • More efficient bonding - 5 day rate is lower so the minimum discount goes down
            • Better integrations with partners
            • OHM gets scarcer over time vs not decreasing
            • Stronger signaling to the market
            • Easier to maintain sustainable growth via non-bond revenue
            • Putting "OHM is just a Ponzi" nonsense to bed

                If we are going to do it, do it. LFG. Cut the reward rate and do it quickly--don't drag it out over an agonizingly long 4 weeks. Rationale: the market is flooded with forks that offer exorbitant reward rates and operate on fast, low cost blockchains. How do you compete with forks that offer 1 billion APY and gas costs of 0.3 cents? Do you offer 2 billion APY and 0.2 cents? No! To win in a battle for market share with an ever-growing number of competitors (imitators, perhaps, but still competitors) you emphasize your strengths.

                OUR STRENGTH: You invest for one reason: INCOME GENERATION. You choose to buy OHM because you want PEACE OF MIND. That's it. So you can sleep at night. Olympus was first to market. Zeus created this brilliant economic model that our team continues to improve. MeTooDAO and GetRichQuickDAO can only attract capital by having higher APY's or cooler memes or locating on the next lightly traveled ultra-hip block chain.

                So JUST DO IT. Make OHM the responsible reserve currency option. Don't try to cater to high-APY junkie-lust. Instead, offer people a RESPONSIBLE CHOICE: 1000 APY. A HIGH but SUSTAINABLE RETURN. Our runway? As far as the eye can see. Olympus doesn't need all the business--we just need to mark OUR territory and defend it with reliability, fee generation, and market share dominance. In short: BE THE BEST, FUCK THE REST.

                To assess whether APY needs to be adjusted, I think we can introduce volatility as a metric

                DOS

                You're probably right. Just thinking out loud. The real question, though, is how does OHM get to be the cool kid in the neighborhood again? Recapture that DeFi SOHMmer magic. It's clear from Zeus' and Shadow's public statements that if the reward rate is (a lot) lower, (institutional, and hence net) demand will increase. Market cap, bond revenue generation and asset value will follow.

                    Does this proposal mean to happen immediately after voting or the idea to make it happen when 10M supply is reached still holds? Last 5 days APY has been screwed and many feel the impact of lower APY when it wasn't supposed to be there, give all people one more punch by lovering it in 6 days from now might not be the best idea…

                    allornone Last time around there was a mountain of complaints about the speed of the proposal to implementation and lack of 'warning' especially for those not around on discord.

                      DOS Just to address this directly - during the migration bonds were disabled to facilitate the transition to v2.

                        shadow

                        I think this was a mistake to bring up now when the migration is causing so much confusion and bonding has been delayed. I agree with reducing but we are only at 6.5 m

                        Unless gigabrains are getting pressured from somewhere to do it asap. Funny just when ohm makes appearance in DC we hear Zeus being embarrassed with high apy per the ama.

                        Focus should be on getting Gohm up and running with liquidity on main net and elsewhere. Too much self induced fud. Moving way to fast in middle of migration

                            Galt

                            The mention of OHM in the Senate Hearings has had zero, absolutely zero, impact on the desire of Zeus, shadow and the other sigs/key team members with regard to wanting to lower the APY/reward rate. The reasons behind lowering the reward rate are multiple but do not include fear of government regulation. You think the TradFi titans at GoldmanSachs and JPM who buy and sell our Presidents and Congressmembers would be happy to compete with 1000 APY? Any rate of return over 2% APR is a direct threat to their profits (or as they would say: Mom, apple pie and the American Way).

                              shadow In general I am for this proposal and will most likely vote for it but I have a concern/question that nags at me a bit in the back of my mind. It feels a little bit disingenuous for the protocol to push the idea of runway length being important and a reason to invest in OHM (I believe these to be true) but then never reach the number of days that the runway shows before reducing emissions. When the last reduction occurred and the runway began to balloon to over a year the thought process for me goes to "awesome, we can have over a year at this rate of emissions…" but that hasn't really been true about the runway. There doesn't seem to be as much of a correlation between runway length and emission reduction as one would assume. So I ask why tout runway when it is misleading to investors because you never actually use the whole runway? This next reduction will extend runway to 700 days but based on history of emissions reductions there is no intention of actually making it to 700 days from today even at the new reduction rate. So in let's say 250 days from now we have another proposal to reduce emissions again and that extends runway to 1500 days, well okay, but what about the rest of those 700 days we thought we had at the previous emissions because of the runway?

                              Also, is 2m in bond revenue/day not sustainable? If not, what is the sustainable number the team has in their collective minds?

                              I am all for this adjustment and understand the need but is there an acknowledgement from the team that runway should not be used as an expectation of future rewards at current emissions?

                                Fully support the reward rate reduction as outlined here.

                                However I have a couple questions for @shadow @abipup and whoever else wants to chime in regarding some comments surrounding our pivot away from bond revenues: In the long-term, I agree that it's wise to reduce bond capacities, pivoting to a greater focus on other revenue sources, which will help maintain health of the protocol. However, I'm concerned that it's too soon to be reducing bond capacities in a meaningful way given (1) non-bond treasury inflows are peanuts compared to what the treasury makes w/ bonds (Source: Dune Dashboard, Revenue (with LP market Value) - if this statement is inaccurate, then I think it speaks to the broader data issue we've seen recently where Dune Dashboard and Olympus Front Page metrics aren't remotely accurate) and (2) OHM market cap is reflexive - when Treasury inflows increase -> market cap increases -> higher market cap means more bond inflows (assuming no BCV changes) -> Treasury inflows increase further -> and the cycle continues. I have seen people reason that bond inflows are lower given (i) OHM's declining market cap and (ii) cyclicality of bond inflows resulting from broader market volatility, however I disagree with both statements given OHM's market cap (and ETH's) hovered around ATHs in the mid-to-late November period while bond inflows hovered around a 7-day MA of six to eight million $vs.$ 8MM+ for the entire month of October while OHM market cap was much lower. Have also seen people say that the sell pressure from bonds outweighs the positive benefits of increased treasury inflows. Can anyone provide data to back this up? OHM hit ATH's in market cap (and saw more price stability) right around the time bond inflows were near ATHs, so not entirely convinced that statement is true.

                                In summary, I'm concerned that it's turned into an echo chamber, with many parroting that we need to reduce bond capacities NOW (some have already been reduced recently IIRC), rather than wait until our non-bond revenues are actually meaningful. However the unfortunate fact is that non-bond revenue is tiny today and a further reduction in bond revenues will lead to even lower gross revenues, which, in my view brings into question OHM's valuation.

                                I want to make clear - this isn't FUD. I've voiced similar concerns in the past and rather than spark reasonable discussion, it gets met with a lot of anger. Genuinely interested in discussing / hearing answers to my questions as I think it's important (and if it's not, then please describe why it isn't) and would love to hear why I'm wrong as I've been an OHM investor since the first week of April and have been in full support of all the policy and protocol moves, until recently.

                                  SateeshK Bonds will go back to what they were at ATHs and hopefully even more, if demand is there. We are just doing active capacity management, which is the Policy team's job. We are not moving away from it at all, just actively managing it. Definitely thanks for the questions and discussion, I wanted to make that clear. Having more non-bond revenue is good as a safety net, our goal wasn't to "replace it", just to diversify the income streams.