It really depends on what the expected withdrawal rate is in the new staking model.
For instance, in my example, the flat APR is 7% while the APR with the current staking mechanism is 7.34% (corresponding to last month’s data).
We don’t know how many staking positions will withdraw early. The model I used to predict the increase in APR is a simplification, but it assigns a random number (1,9) to each active staking position and evaluates the increase in APR over time.
This model will be inaccurate to a certain degree, as there could be a tendency towards longer/shorter staking periods depending on market conditions.
But in any case, the minimum APR Solution #1 would assign is equal to the flat APR, that is, if all stakers withdrew their stake after contract-expiry.
What this change provides is for participants to choose whether they want to continue staking for 9-months or withdraw if they’re satisfied with their rewards beforehand. This is something that is not possible currently.
Thanks a bunch. Regarding costs of development, I’m afraid I made the mistake of not including this. But at the same time, Minswap Labs has a source of revenue for development & maintainance which are the batcher fees. But I’m not able to answer in more depth.