PoolTogether

POOL Distribution Standard: Non-Stablecoin Pools

I am proposing creating a standard for how pooltogther distributes POOL to non-stablecoin pools. Currently, due to the difference between interests’ rates, the protocol accrues an entire magnitude of ten more in the reserves from stablecoins than non-stablecoins. In reality, the protocol would get a better bang for it’s buck by just market selling POOL for these other tokens currently being accumulated (COMP and UNI) than by distributing POOL. This will only get worse as supply distribution change is coming up and will most likely be cut by a decent amount. I think there needs to be a change in strategy and that we have a different plan with how we deal with stablecoin pools and non-stablecoin pools.

The strategy I am proposing would be to:

  • Have the current ratio between stablecoin pools and non-stablecoin pools in terms of POOL drip remain the same (90%/10%).
  • Have the 10% go to one non-stablecoin pool for 13 weeks (4 per year).
  • Retain 100% of the prizes for the entire 13-week period.

Essentially, we would be subsidizing the yield of the non-stablecoin we choose, in return for the interest accumulated from those non-stablecoins for 13 weeks, using this as initial kickoff events for pools to accumulate large initial reserves.

Pros:

Marketing: One result this would have is introducing pooltogether to different communities in defi. Members / token holders of that community would benefit from the POOL subsidy initially, then after the 13 weeks they would benefit due to the existence of the pooltogether pool for their token which would have a slightly higher apy than just the yield source alone due to the reserve accumulated over 13 weeks.

Reserve: This will also kickstart the reserve of a pool. After the 13 weeks, the reserve precent could be lowered to 5% and the protocol would begin accumulating reserves through interest without any reliance on a POOL drip.

Cons:

The main con would be the dramatic loss in deposited funds in the current non-stablecoin pools, as they would stop being subsidized by POOL funds. To me this is not really a con because with the reduction in POOL supply this is going to happen anyway by probably the same factor that POOL distribution is reduced, and if we ever added any new pools to the non-stablecoin drip it would reduce them by huge factors as well. And as stated previously the protocol accrues basically nothing in terms of those coins in comparison to what is distributed.

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I don’t think this really fits the spirit of Pooltogether. Eliminating prizes completely doesn’t make sense to me.

I don’t like switching the distributions around too much in general. I think people need to be able to plan and rely on continued distributions. Depositing and withdrawing is very expensive, so staying in for a long time is preferable for small-medium deposits.

I agree with you that the POOL distribution to stablecoins should be much higher than non-stablecoins, as these have higher interest rates, which can be captured through the reserve.

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