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.
OIP-18: Reward rate framework and reduction
While it should be clear to every ohmie that OHM is actively managed by human governance and thus subject to frequent changes, I agree with OP that the change should be slower, and more predictable. However the "us vs them" rhetorics (e.g. new vs old ohmies) is not helpful and I would love everyone to refrain from it. Every ohmie should be in the same boat.
Very interesting and I like the idea, I think the challenge here would be finding the balance so that these whales don't just split their OHM amounts to different wallets to keep maximum gains. But I do agree with this concept for sure
I understand the APY:RFV maintenance. Backing is part of the goal.
But please ser, gigabrain me on this framework. Aren't there moving variables to consider across such growth?
I purchased OHM in July, so I am fairly new. I totally understand the arguments. My vote is for longevity, and therefore whatever it takes for (3,3) in the long-term. Appreciate all the work that has been put into this, BTW.
I am personally in favor of the proposal (as I was with the last reduction). It provides clarity, structure, and vision to how the protocol can survive long term. Everyone knows that rewards at this level cannot last forever. This proposal lays out how it can be managed going forward both internally as well as to new participants and those we want to partner with. That said, delivery and human nature are at play here which is why this reduction is more heated than the last, noting that the last one was more urgent. While it has been mentioned in Discord that the policy team has been talking/working on this for months, it hasn't been on the minds of others (300 days of runway). Therefore it has come as a shock to many (a large number currently underwater). 9 additional days to double is nothing in the long run but an eternity to people who recently purchased and are at a loss. I want to thank the Policy Team for their work as a lot of time goes into what they do. That said, policy is at the core of this experiment and any change to it needs time and discussion. Not all of us live in Discord everyday so short timelines amp up tempers and stress people out. Would suggest next time make an announcement at least a week ahead that a policy proposal regarding "x" is coming. This is also why I am in favor of the loose framework. (3,3)
As someone who’s been with OHM since the start, I’m going to vote against this proposal.
Thank you.
Supply is currently increasing exponentially and revenues increase linearly.
This is not a sustainable future for the protocol. Let's adjust now.
The reward rate decrease helps lower 5D ROI & makes bonding attractive to support growing inflow.
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- How many day from implementing 300 day runway of 16K?
- In 2 months I see another proposal to decade the APY even more as the engineers will miscalculate again…
Anyway information about this proposal should go to main stacking website, not all Ohmies are living on Discord. There will be many OHMIES not even knowing there is some proposal, nor voting.
After doing some more thinking, and taking in consideration the ~ 3 weeks we're going to have of more-or-less 17k% APY, I am changing my vote to option 1. I still think that it's bad optics not telling new people sooner (even now, why are we not putting a link to this proposal near the APYs?), but I think long-term this is a good decision, even though I don't like the method it's been communicated.
See also this tweet thread which does a good job explaining the benefits.
Something that hasn't been touched on yet:
- This proposal will increase price, bond incentive and revenue. The argument that new OHMies are in the red because of a price drop and need time @ high rewards is asinine, this is because the longer we keep this high compounding APY with linear or falling bond revenue, the lower the price will go.
- I was one of the people that bought above $1100, at the depth of the lows, the APY was cut, allowing bonds to be better incentivized and kick starting the revenue engine. We are now redlining at this APY, and need to shift to second gear, which is:
Reducing APY -> Making Bond discounts more attractive + lower supply growth -> increasing revenue (& RFV per OHM) + increasing price
You bought into a stable coin experiment with high risk and high reward, the protocol shouldn't give a **** what proportion of people are in the green, the only thing it should concern itself with is balancing price, bond revenue and supply in order to grow to billions of OHM in supply at >= $1 RFV and keep this fairly execution risk mitigated engine that we have created so far humming along for the long term.
I think new OHM holders who have i boarded in the past few weeks May find this very unattractive. With the price drops a lot of them are in the red and this would further prolong the process for their good outcomes.
Additionally I am not clear how does this reduce price volatility.
Lastly if are run rate and revenue is not changing why are we looking to change the rate today and not instead in a gradual few month process so anyone new who joins today knows this is on the cards and can accordingly decide their engagement instead of doing it within the next two weeks!
Adopt framework and Reduce reward rate should be 2 separate proposals.
If not separated then more voting options must be provided. The options currently presented are not comprehensive and force a choice from what appears to be a biased answer set.
At minimum, a 4th choice to implement framework, but do not change rewards should be available.
But also should be options to indicate acceptance but only if implementation of framework and/or reward reduction occurs on a longer timeline.
This is excellent, and point 7 especially there has been marketing done around 10k APY very very recently. False promises abound and people will feel sour. You might also press sellers into a short 2 week window prior to APY dropping.
What is going to happen without new funds or trading fees.? I started buying two weeks ago and am still under water but was ok with that as I was looking long term. I was going to dollar cost average in alot more funds but I'm going to reallocate those funds into one of the many other opportunities out there until this gets straightened out. This change makes the near term outlook on this project look alot more riskier than before since this incentive for new funds to come in will be greatly diminished which reduces the long term survivability of the project.
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Could someone explain why they assume a whale would be more likely to dump if they are earning less per rebase than if they are earning more? Seems like an irrational fear.
If it's because you think the price will be higher, isn't that good for you too? I don't understand.
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Also worth noting that APY is never guaranteed in DeFi. In other projects, yields can be cut in half overnight with no notice just because a lot of money got dumped into the pool. Nothing about making the protocol healthier, just someone came in to scoop up more for themselves. Too bad.
The fact we're getting what amounts to a few weeks advance notice about a decrease to prolong longevity and health is pretty great comparatively. Not to mention we're still looking at a 70-100x return per year. Concerns about people down 20% not getting to breakeven "long-term" are unfounded unless their investment timeline is two weeks.
When the time to decrease the rate rolls around again, anyone who stays in will be accused of "pulling up the ladder" for newbies. Just like they were the first time, before market cap went up 4x for all hodlers. There will always be new people that claim it's not fair and want a few more months at the current rate, even if that's detrimental to the protocol to do so.
If they wanted the same returns as people who took on more risk, they should have taken on the same risk and bought earlier. It's like saying it's unfair to earn more when you buy 10 BTC at $1k instead of 1 BTC at $10k.
That being said, now that we have a general framework it should definitely be communicated to try and minimize that aspect.
+1 for long term thinking, -1 for three week thinking. I trust that the policy team has more information than I do. Thanks for engaging. Excited for the rate reduction. Nothing is ever set in stone in the world of DEFI. I take sustainability over a vanity APY.
If you are feeling burned, DCA folks. It is your best friend when holding a bag.