POOL distribution & V4 Rollout

Totally agree on this and with more prizes, the effective APR is much more meaningful because you will actually win. APR is still the language people understand so we need to communicate that to them in some way.

Tagging @chuckbergeron @dylan to think about that as well.

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My thinking is POOL distribution for the entire protocol being below 500 POOL/ per day. This would set a clear message that there will be no more cheap POOL coming and if APR is gonna get back to what it was it will be because of price growth. The narrative I see here is that this will be your last chance to buy POOL sub $10.00.

I would also only pay out grantees in USDC for the remainder of the quarter to ensure we are not contributing any sell pressure whatsoever.

In addition we could consider paying out the POOL pool drip in KPI options going forward making it a place for those in it for the long term and who want to contribute to governance.

There could be a period where we allow heavily slashed incentives to V3 to aid in the transition. I definitely don’t like the idea of completely removing distribution but could get behind this drastic reduction. Despite being a bit terrified of taking this risky plunge I could YOLO into it.


We already pay grantees that would sell their POOL in USDC. I don’t think grants is contributing significantly to sell pressure at all.


I took UNI as a case study of what happens when a successful protocol removes incentives.
They kept them off until now, but have recently started talking about reintroducing them.
Here are annotated TVL and UNI/ETH charts. I used UNI/ETH instead of UNI/USD as this filters out the increase in UNI price that resulted from the entire market going up.

On the TVL graph, the effects of stopping incentives are very clear in the short term.
On the price chart it’s hard to tell what the effect of stopping rewards was.

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Part of it is not wanting to give away any POOL at these prices, at least temporarily while the dust settles. I do think grants does a good job and it is nice that a good chunk of the budget is USDC.


Fully supportive of this plan. Minimizing supply to yield farmers is definitely worth exploring as we kickstart v4 (at risk of a lower TVL).

Here is a look from supply and demand side

Supply side

  • Utilize innovative ways to distribute POOL incentives, (if required post v4)
    • Distribute POOL based on length or history of deposits (suggested by Leighton in his post)
    • Distribute locked POOL that is not transferrable for a period of time (say 1 year)
    • Distribute POOL based on target KPI options, if we meet a certain threshold (TVL, prize pool etc.)

Demand side

  • Utilize this opportunity to also increase demand side for POOL
    • We should not require POOL as a requirement to increase prize winning odds. But anything else should be on the table
    • Drip POOL to pPOOL depositors at a healthy ratio
    • Open to other ideas…

Some have asked for the UNI/USD annotated chart. Here you go:

It tells a similar story as the UNI/ETH chart, except the price movement after ending yield farming looks a lot friendlier.

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In summary, let’s time dropping the yield farming incentives with the start of another bull market. Got it, piece of cake!


I completely agree with the original post, incentivizing POOL pool & LP’s like this is great, you could drip a lot of POOL to POOL pool in order to incentivize people to buy more pool and stake it (early exit fee could be added to just ppool), would like to see even more reasons for people to buy POOL in the future. The protocol will grow over time so TVL/prizes is a short term looking metric.


Posted this on discord but I’ll add it here to. I’d like to maintain some small APR that ensures even the most unlucky player is better off depositing to Pooltogether than saving funds in their bank.

I’d propose:

  • 500 POOL per day to USDC POOL V4
  • Drip KPI options to POOL pool instead of POOL
  • Reduce LP incentives to 150 POOL per day and divide that between multiple platforms
  • Do as Leighton mentioned and inject $50K USDC per week as prizes.
  • Have some reduced drip to V3 pools extended for a transitional period to try and keep as many of those depositors as we can.
  • Maybe crank up the V3 reserve rate a few weeks after V4 launch so that interest goes to the protocol and users migrate.

I support removing all incentives for launch. this is an opportunity to determine the organic demand. It is not permanent, and we can use our toolbox at a later date if needed. This should have a great outcome for the price of the POOL token.

Injecting USDC directly into the prize should be an interesting experiment and should create at least some demand for a spot in the pool.

We will never know if we do not try, and as I said before this policy can be altered at a later date in more creative ways as Leighton mentioned.


One important thing to keep in mind is that with V4 any incentives that are offered will be chain specific. This is another reason it might be better to start without any special incentives. We can see which chains get the most use, etc.

But with that said, if we were doing 500 POOL per day, how would you suggest splitting that between Ethereum and Polygon. Any thoughts on that?


That’s a tough decision deciding how to split it. I do think we need to really be pushing users to layer 2 to keep on brand with no loss. I’m sure there are whales that would continue to use layer 1 and we would also need to leave room for drip to other networks.
I would either do an even split or slight advantage to Polygon over Ethereum as we want our users to be getting the cheap transaction fees.


I have been thinking about this quite a bit and here are my thoughts.

I think we should let the POOL rewards expire on v3 but I strongly believe we should continue the POOL drip for v4. Here is my reasoning.

  1. According to Llama DAO’s report, I believe (correct me if I’m wrong), that only ~15% or so of POOL emissions are being sold after being earned. This is an incredibly low number. We would benefit more from improving the incentives to hold POOL than removing the drip entirely. It seems clear POOL’s price performance is related to a lack of buying pressure and not because of the POOL drip being sold at an unsustainable rate.
  2. We want big prizes with v4 (that $1M weekly prize goal!). If we remove the drip, I fear we run a serious risk of big players leaving which puts us back from our goal. We cannot risk this. Instead, it would be wiser for us to decrease the drip as the prizes get bigger, instead of removing the drip before we get to this goal.
  3. If we end the drip on v3 and keep it on v4, then there will be more incentive to migrate which is crucial.

While I agree that PoolTogether should not be about yield farming, it is like more like a carrot on a stick at the moment. We need to get to $1M weekly prizes, so let’s keep the carrot. It’s not being sold at an unsustainable rate, so the argument that it should be ended entirely is far too risky. It might set us back more than it would help, and getting out of that hole if it does set us back would be difficult and even demoralizing.

So, my strong suggestion is to keep the POOL drip for v4. Let’s bring in the big money along with the small fish who are attracted to the bigger and more numerous prizes in this next version. We can tweak the parameters as we hit our goal, but removing it entirely is, in my opinion, reckless.

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While this is interesting, Uniswap removed its incentives when its liquidity was already massive. By comparison, we’re quite small. Also, you can farm with Uniswap’s LP tokens on other protocols, so it’s not an entirely fair comparison to PoolTogether.

Let’s get 10x more TVL and then we can remove the POOL incentives without any problem. IMO it’s far too risky now.

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Also, one last point, I really don’t think we should touch the LP incentives. Out of all the POOL drip, that one has by far been the most successful. And we’ll definitely need it with v4 demand :wink:

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I think v3 support should be dropped gradually but on a much longer timeframe. 1-2 years. This will accommodate all existing depositors, where POOL incentives are rewarded. It will be a nice way for those who locked in the funds through high fees for holding long term. Eventually, it will pay off enough to stop the POOL drop and move everyone to v4.

v4 should be immediately incentivized from the start.

All in all the POOL pool should incentivize participation with higher than average money prizes and drip rewards. People should buy POOL to enjoy this exclusive “club” if you will. Then add governance participation as the 3rd strong benefit and you have a thriving economy.

Bonus: The POOL funds in treasury could be used in part as “sponsorship” capital for the POOL pool.
This needs to be worked on.

POOL pool ftw!


I’d be into keeping the same amount but we should really split it up to other platforms a bit. I think we are dripping more POOL than needed considering the current volume and spreading that liquidity to Sushi as well as UNI would probably be more effective. Also having some LP incentives on Polygon would be wise and I don’t think it needs to be a high number on Polygon.

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Why? I’d like v3 to be defunct by end of year, honestly. All in on v4.

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Great points! A few responses:

According to Llama DAO’s report, I believe (correct me if I’m wrong), that only ~15% or so of POOL emissions are being sold after being earned.

This was stated in the Llama DAO report but their data collection was not very good. We would need to research this a bit more to validate. This would be worth pursuing. I can say, simply looking at the contracts. There are not a lot of claims against the faucets. Here is the Dai faucet it’s pretty much just the whales claiming. There have been 25 claims in the last 6 days.

We want big prizes with v4 (that $1M weekly prize goal!)…

Agreed. We need big prizes and removing the drip will mean a lower TVL. However, assuming we are subsidizing the prize directly it will mean the prizes will still be just as big as they are today and if there are less whales it means there will be tons of people winning them. This paired with low gas fees will hopefully mean that we accelerate organic growth of smaller deposits. We can then add in POOL incentives to make growth explode.

If we end the drip on v3 and keep it on v4

Another good point. Ending drip on V3 is imperative to me and adding it to V4 is also imperative. It’s just a matter of when and how.

I also want to add some nuance to differences between on POOL incentives worked in V3 vs. V4.

V3 was a simplistic pool distribution. It was awarded in real time and equally to all depositors.

V4 gives us a lot more options because of the “TWAB” (time weighted average balance). We can measure any users balance over the last 6 months. That means we can implement things like “Streaks” (i.e. keep a deposit in for a full month and get the POOL bonus then) or other creative ideas. All in all, it should allow us to be much more effective in distribution pool.

Finally, keep in mind that V4 is multi-network so any incentives will be done on a per network basis.

To re-iterate, I 100% believe we will want and need POOL incentives to reach escape velocity for V4 ($1 million weekly prizes). My proposal is not to stop them forever but simply to use a phased launch to make sure they are done effectively.

Phase 1: No POOL incentives but subsidize prize directly, focus on ensuring everything is working properly, parameters are optimized, and people are winning lots of prizes. Make sure people love the protocol even without POOL
Phase 2: introduce POOL incentives in a targeted manner to grow prizes while keeping odds of winning the same. Use POOL to accelerate growth

Phase one would start October 13th and ideally Phase 2 would start in early November