OIP-18: Reward rate framework and reduction
Mark, you do realize that it's a range, correct? It could easily be 1000% APY instead of 10k%.
Again, I'm not against a reward reduction (the framework itself though needs to serious separate discussion IMHO). What I'm against is the apparent bad faith this proposal was submitted in.
Maybe it's just me reading too much between the lines. I personally am OK with reducing the APY, but the general framework needs SERIOUS revision and discussion, with some SERIOUS pros/cons listed and rationale behind it.
IMHO this is a defining moment for Olympus. You guys have advertised A and now you're effectively pulling the rug from <50% that joined in the last month. Not cool. In the end the actual snapshot vote will show how centralized the voting power in olympus is, as I think the general sentiment is clear.
Volatility is a part of crypto, it doesn’t make sense to reduce the rewards. If a whale decided to sell then the price will dump regardless of the APY. So the point is how will this effect new comers which make around 46% of ohmies in the past two months and small bag holders. Most of them joined and builded their expectations on 17k APY, then to just hear that the APY will go to 10k and probably less than that, it’s just disappointing to them and new people as well. Change is good but a lot of it and especially major changes like these are critical and can make or break the project
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I think that 3 options to chose from is pure psychology Chose what we want option 1 or chose slightly differnet looking choise (option 2) - still what we get what want to archive!
In this way the votes get diluted and then it looks majority want the proposal to pass!
The official and unofficial voting should be binary - YES / NO. The clearly see what majority want! And not diluting it thru many (slightly difrent) options.
The last rate reduction estimated an APY of 20K% and we ended up at 15K. That 25% miss gives me little confidence this next reduction would stay on the high end and fear it will have a irreversible negative impact on the sentiment of the community.
Allowing this proposal to pass in ~ 2 weeks signals to everyone now and in the future that OHM will pull the rug last minute from under people that don't have 24/7 to dedicate scouting discord for clues. Because if you went by twitter threads (and there's dozens of them), none of them emphasized at all this coming reduction.
As such, it feels like this proposal might have some intended effect short term, yet long term confidence in the protocol will be down the toilet and more sell pressure, not less, will be experienced as people can't wait to get out.
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As a new user.. I would be very disappointed to have a reward cut. I along with a few others have only been in for 2 weeks.. and have already experienced a near on 50% haircut, so as you can expect.. deep in the red. Obviously our timing wasn't great. That being said.. all we're thinking and hoping for now is to get back to break even.. No doubt some will pull out if that ever materializes, as the risk of another 50% cut is too much.
From what I recall.. nearly 50% of OHM users joined in the last month, so chances are the majority of them are all in the red still. I can bet that a lot of other new users who joined.. will be thinking the same thing as what I just stated, which isn't a good thing. Having discussed this with a few others.. If the reward cut came in, in 3 months time.. then we would gladly accept it as the chances of being above water would be high if not certain, but implementing such a cut right now is too soon imo.
This proposal fails to explain to me why we will fail if the APY stays the same. There are concerns but nothing concrete. Am I wrong to assume the APY goes down as more people join and stake? If that is the case shouldn’t we focus on bringing more people in to reduce the APY instead of reducing the rate?
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I agree with dns here. I’d rather go this way. Incentive small wallets, and substantially lower APY for the largest wallets, maybe couple with a warm up period. I’d like to see a stable and higher market value, too. I think all of us here want to do the best thing for each other and the protocol.
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EDIT: I changed my opinion, see https://forum.olympusdao.finance/d/77-oip-18-reward-rate-framework-and-reduction/137
==== ORIGINAL POST ===
For those not following on Discord, there's been some very lively discussion and disagreement on this proposal.
On one side, we have the initial OHM holders (~ 4000 people or so ) which are "thinking about the protocol", and want a more sustainable runaway. This group will not feel any sort of pain due to this change, as they've been in the protocol for a while now.
On the other side, we have the other 50% of users which came into the protocol in the last month. These users have been attracted through MEMEs, Twitter Threads and various other community building methods though a (stated or implied) claim that the 5-6 digit APY will continue and that we can sustain these levels for 300+ days.
This second group is rightfully disappointed, as the marketing was deceiving. It's this second group that's supposed to now "protect the protocol" and "think of the future" and are being accused of being selfish individuals that are looking only to cash out and protect their rewards.
This can't be further from the truth. While yes, of course, there is a monetary incentive (that's why the majority is in crypto), what one might be missing is the fact that initial members of the OHM community (the initial 50%) ALREADY had time to express their inner and innate selfishness! They were here at 4$ OHM and 100k% APY. They had plenty of time to collect quite the sum, yet nobody was calling them selfish at that point!. It's only now, when the remaining 50% wants a cut based on deceptive marketing claims that "they are the selfish ones not thinking about the protocol".
A lot of the NEW OHMies also agree that this proposal is too fast. Someone on discord suggested to implement this change, but not immediately. While it's true that we should be doing the necessary for the longevity of the protocol it's also true that OPTICS and community sentiment matters just as much as "the protocol". Afterall, it's humans that make it all work.
So, my proposal would be to implement this change over the next 45 or so days (we can decide via pool). During these 45 days, display a banner that says APY WILL be going down due to this OIP. This way, any new OHMie coming in knows exactly what to expect and the existing new OHMies still have breathing room and can be satisfied they haven't been deceived via BAD marketing.
This "us vs them" mentality is way off base and can't be further from the truth. It seems easy for you to ignore the blood, sweat, tears, and risk that early people took (including people like me who bought in at 1000 dollars). Frankly I'm insulted by this sentiment.
We can discuss if clearer marketing is needed, but that's outside the scope of this proposal.
To comment specifically on your 45 days proposal: this change is already happening over a minimum of 3 weeks (1 week forum, 5 days snapshot, 2 weeks linear decay implementation to new reward rate). Why is that not enough?
I will vote in favor of the reduction, as it's best for the long term, but would like to see it implemented over 45 days or so to be fair(er) to new ohmies. I hope the final proposal put to vote will include a longer (than two weeks) implementation period.