[Proposal] Rewarding ctez liquidity and reducing the minting rate

Proposals Minting & Rewards
1

Summary

A shift from PLENTY-based liquidity to ctez-based liquidity. Alongside this shift, a new way of allocating rewards is proposed based on percentages. Furthermore, a minting rate reduction from 30 PLENTY/block to 20 PLENTY/block is proposed.

Abstract

If adopted, this proposal will implement a:

  1. Reorganization of the yield farms and substitution of PLENTY-based LP farms for ctez-based LP farms.
  2. Revision of the PLENTY reward distribution based on percentages, increase rewards for Ctez LPs.
  3. Update of the PLENTY token smart contract to reflect the new minting rate of 20 PLENTY/block.

Motivation

Ctez liquidity

When the Plenty token-to-token AMM was launched, there was no suitable tokenized tez available in the Tezos DeFi ecosystem. As an alternative, PLENTY was used to pair tokens on the AMM. Since the introduction of Ctez, it has become possible to provide liquidity to trading pairs of Tezos tokens that are paired to ctez, a collateralized version of tez. Hence due to limitations of the native tez token it is not possible to use tez directly for all DeFi purposes. Thus, Ctez can be considered similar to the native tez token with improved scalability.

As Ctez matures and opens up new DeFi possibilities, and as we notice the success of wrapped and tokenized forms of native assets in other DeFi projects (e.g., traderjoexyz.com), we believe it is essential to revize the liquidity pools of Plenty accordingly.

Currently, it is challenging to attract new liquidity to Plenty, with most of the incentives being added to PLENTY-based LP farms. We believe that the prioritization of ctez in trading pairs on the yield farms will substantially increase the usability of Plenty and reduce the burden to attract new users of the platform. By incentivising ctez, the liquidity and TVL of the protocol can grow, even when the price of the PLENTY token doesn’t follow.

Ctez, a collateralized version of tez, is an asset that is more suitable for traders compared to PLENTY. Furthermore, by facilitating traders the revenue of the protocol will increase for xPLENTY holders.

Percentage based reward rates

By introducing percentages, the different rates for each farm become easier to interpret. More mint reductions and reward changes are a certainty in this fast moving industry. By using a percentage-based approach, this becomes an easier process for users and the dev team.

Minting rate reduction

By reducing inflation, the sell pressure of the PLENTY token is reduced. Reducing the PLENTY that’s distributed to farms might have the short-term effect of lowering farm APR. However, in the long term, the goal is to keep supply low and demand high. So if the token price rises due to a lower supply, this will help sustain a decent APR.

Specification

  1. Update the storage of tokensPerBlock to 20000000000000000000
  2. Update farm rates based on percentages.
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Temperature check

  • Yes, I support this proposal
  • No, I’m against this proposal

0 voters

References

3

To participate in governance you need to hold xPLENTY. To get xPLENTY a user needs to stake PLENTY. Further down the line more tie-ins with the DAO can be introduced like protocol owned liquidity.

And please stay on topic :slight_smile: talking about rugpulls and such doesn’t move this discussion forward!

1 Like
5

You can only vote with xPLENTY so I don’t really understand what you are going for here. There is another topic that might be interesting for you: Lack of built-in XTZ → ctez → * routing harms casual user experience - #12 by bernd.tez

But lets stay on topic for this specific proposal please!

6

you are mandating everyone to take the IL loss in those discontinuing farms…
how do you think users will feel?

5 Likes
8

We need time to take profit before withdraw from any PLENTY farm. discontinue all this may harm many current users

4 Likes
9

You are asking Plenty/xPlenty holders to vote for Plenty/xPlenty being reduced to having close to zero utility beyond voting.

What did you imagine holders would say?

5 Likes
10

I see this being a good move at some point, but not really right now. It pretty much makes the only use case for Plenty be to stake for xplenty or participate in the plenty-ctez farm. The sell pressure won’t really reduce unless everyone decides to put their rewards into xPlenty staking because the other use will be to swap half plenty rewards to stake in the plenty/ctez farm, swap all for the other farms, or just swap to tez and cash out.

Maybe if the xPlenty percentage share was at least even with the top percentage would this slow sell pressure, even still, some people will still sell eroding the plenty/xtz ratio. If the xPlenty reward percent is the highest we might see some increase in the ratio but then that lowers liquidity in the farms. I understand it’s a complicated balance in this early phase when other plenty utility is still being built out and on the roadmap but hasn’t arrived yet but the price is eroding and some liquidity is leaving over time.

What I have in plenty is a long term hold so I’ll be holding with wherever the tide goes. I wish I was more capable as a developer to assist but my experience is nearly 20 years ago and super rusty.

1 Like
11

Ctez so far has been the cause of Plenty sell off.
Deny that means to live in denial…
I’m not against Ctez, but at this point I would put it on the side and maybe relaunch it when (6-9 months) flat curve will be introduced.
We saved some Plenty emission with last vote, let’s do something clever with it!

3 Likes
12

To attract new liquidity at less of a risk, I think the use of ctez farms is a huge step in the right direction for bettering the platform as a whole while giving a practical use case for ctez.

That being said, it is very iffy where this leaves PLENTY as others have expressed, essentially replacing the token’s greatest utility and leaving the long term holders’ investments in limbo. If people don’t want to take part in governance and just cash out their rewards then it would never be a more tempting situation to do so, and those who have taken on the biggest risk investing in PLENTY may not feel like they are being justly rewarded. I’m genuinely torn on this one.

3 Likes
13

While I do agree that this is better for the platform long term, this is absolutely horrifying in the short term. We’ve already taken big hits from IL, what are you going to do to incentivize people to not sell all of their Plenty when they unwind from the liquidity pools? I don’t think this should immediately drop the interest rates to 0 for the plenty pools. Do it slowly to avoid the sudden shock.

Overall my opinion is this is long term good, but this comes heavily at the expense of all users who’ve held tight with Plenty since the beginning. For me personally, I’m already considering selling all of my plenty because once the farms go to 0 apr, my liquidity is going to take a big hit. What are you going to do to incentivize people not to sell?

3 Likes
14

Airdrop xPlenty to long term holders? Hmmm…

Or how about an xPlenty > Plenty farm? That would incentivize holding. I would be interested in double stacking yields, it would also create buy pressure for plenty in the short term.

1 Like
15

ahah… how big has to be to offset all my loss since ctez launch! :sweat_smile:

2 Likes
16

this in the long term would be great but first there to give the utility to plenty, there 28 million more what remains to be mined without any use. think about creating some fund with all the liquidity of plenty like Olympusdao where each transaction burns plenty of the group or something similar. 1st a solution for plenty 2nd the change to ctez, that’s my opinion.

3 Likes
17

Is this a joke? 0 plenty rewards? Do you really think people are buying xplenty or any other defi product for governance?

3 Likes
18

I like the idea, but it leaves something to be desired as far as Plenty itself goes. Long term I can see things balancing out, but I can also tell there is going to be some pain on the old Plenty-LP side. Given the impermanent losses we’ve suffered already, that’s rough.

19

Unfortunately, it seems at this point the team has little to no concern towards their early investors
Do you realize this will tank the price of an already diminished Plenty token?

You guys just keep experimenting on our expense and just ignore our feedback and keep pushing this ctez experiment no one asked for and clearly didn’t do well for plenty. Those are the facts but who am I kidding non of this feedback will matter and y’all just gonna keep doing what you’re doing.

I lost all trust in this team and I wish I could exit at a reasonable loss but that’s not the case. Thanks Ctez!

6 Likes
20

Can you please elaborate on the points in the proposal? What would you like to see instead?

21

I was quite fond of the early Plenty-XXX pools and it was a smart system of having liquidity providers buy in PLENTY to earn the high rewards.
Sadly as soon as the liquidity hit a ceiling there were no (marketing) actions taken to bring in more Liquidity Providers (and haven’t since).

An easy marketing tool would have been to announce new farms beforehand and create some hype, instead of these ninja launches that just created arbitrage opportunities for ppl that knew how to take advantage…

So now we’re stuck between Plenty pools that many won’t touch because of the massive price drop and ctez pools that will likely hurt the plenty price (unless we see an unprecedented amount of volume ).

In my opinion we need

  • one xtz routing pool (xtz-Plenty or xtz-cTez)
  • a strategy that gives ppl incentives and confidence for holding PLENTY/xPLENTY
5 Likes
22

Closing a farm doesn’t mean you have to remove your liquidity!

23

Please lets stay on topic! :slight_smile:

1 Like