This is not a good idea. I see what you’re trying to accomplish with this suggestion (prop up MIN price) and I get it. The DAO treasury is the mechanism by which, in the near future, Minswap will pay its bills. Website hosting costs, bandwidth charges, auditing fees, MInswap Labs salaries…all of these things need to be paid for, usually in actual real money. The treasury needs to be a stable source of cash, and should actually hold a mix of assets, ADA included–perhaps favored, even. If the treasury only holds MIN, Minswap would constantly have to dump huge amounts of MIN onto the market to convert it into ADA or stablecoin to pay for these things. This would actually be much, much worse for the MIN price, not better as you seem to surmise.
This isn’t to say that some MIN buybacks can’t occur…if/when we eventually redo the LP fee, I rather favor the idea that a small portion of that fee could be used to buy MIN and which is then redistributed to locked MIN holders. These ideas will be discussed on the forum in the future.
I’m biased. On one side I’m one of the FISO pools who suffered severely with the recent network centralization, being close to having to shutdown. Option 2 would allow me to kick-start the engine and I truly feel that it’s important to protect the backbone of Cardano: decentralization. That being said I’m also a passionate and thankful member of the Minswap community and with that in mind I voted for option 3.
My thought is to implement option 3 with an eventual, graduated process toward option one. FISO pools should benefit from the relationship Minswap has developed with them, but the idea of a permanent consideration in exchange for the cooperation provided makes little sense. That FISO share of option 3 should fade with time. Perhaps there are other ways to benefit the community that could evolve from that share of the staking. Thanks!
Longer term, it seems to me that there are two classes of LP holders and they should be treated differently.
The first is the LP holder that isn’t in a Farm. They hold the LP in their wallet, receive fees for providing liquidity. They either can’t or don’t want to farm/commit their LP for farming. It would seem clear that the ADA they hold in the pair should be theirs to stake. Not sure if the SC has a way to indicate that the ADA is present in the wallet holding the LP tokens, someone with more experience on that can answer.
For those who put their LP into a Farm, well that seems to also be clear that the ADA in the pair would be under Minswap’s direction. The LP no longer even appears in the users wallet.
I think I understand what you are suggesting, but I worry that it is a result of not understanding how liquidity pools work?
When you enter into a liquidity pool, the assets you deposit are not yours anymore. This is why the pair leaves your wallet and is replaced with LP tokens which represent your share of the pool. At any given time you can determine the equivalent amount of each asset your LP tokens represent, but it is dynamically changing as price moves.
Simply put, if the ADA is not yours then you cannot stake it yourself. The proposal above is asking the community what to do with the ADA you (and everyone else) put into the DEX’s liquidity pools.
I voted for option 3 but also thought option 4 was good. I have lots of concern about the concentration of SPO’s with multiple pools therefore causing less decentralization. We saw this happen with SS ISPO and then was reinforced again by the RISPO SS had that moved the ADA to small pools to support them. As mentioned by Minswap discussion, many small pools are closing down, even some Minswap used for its ISPO. That fact concerns me and should concern IOHK and dApps.
We would also add a requirement of the small pools that get the delegation, they should post about Minswap DEX to boost awareness of the protocol and get more users.
As a single stake pool operator/owner i agree. I like 3 . maybe have a system where we chose a number of pools to not oversaturate the pools we delegate too. based on the k factor and the rest of cardano parameters.
The LP tokens represent a 50:50 pair, one half of which is Ada in this case. I can transfer the LP tokens out of my wallet, so the representation of value is still under my control. I could sell the tokens for a fair market value.
This is a different state than farming, where I don’t have possession of the tokens.
You’re correct that I’m not that familiar with the ins and outs of smart contracts, but it seems like it might have been considered to place the tokens into a smart contract that would reflect the current value of ADA and delegate it that way.
While of course you want to maximize your $$, sometimes by supporting FISO pools you may be gaining support from them and those unseen benefits far outweigh the extra %. I would recommend doing a combination of option 1 and 2 in the future.
I think first rewarding MIN holders and hopefully incentivizing higher and higher TVL, we will be able to eventually provide most of the ADA staking to FISO pools. We need to show that MIN is not a farm and dump token. Providing sustainable ADA staking rewards is a good first step. As we do that, we can incentivize higher TVL as people will want to farm MIN (and hopefully not dump!), thus having more ADA to stake to FISO pools in the long run.
Maximize ADA rewards and then use those ADA rewards to purchase more MIN then send MIN to burn address forever. Or purchase more MIN and distribute the extra MIN back to the users who are farming.
This would be a blessing to the community. Thanks.
I feel Minswap should support the community/decentralization by implementing some form of staking to SPOs. I personally voted for #2, but could live with #3 or #4. I also think one condition is that SPOs agree to cap the margin at no more than 2% to participate.
