PoolTogether

POOL pool Jackpots

I’m interested to see what kind of useful utility we can give the token outside of governance/treasury management. We’ve already got a good one here so thanks for sharing!

I literally created a very similar proposal idea that also gives the POOL together token more utility at the almost same time.

With the advantage of adding something different to the pooltogether menu other than prizes / lottery / jackpot. Don’t get me wrong, I believe the proposal to have a weekly POOL prize per wallet is better than nothing, but there again it is just one person that wins.

We already cover the “Win prizes” part to trigger human psychology. We need to trigger the farmers / yield / earning interest etc. part of people next.

I actually also imagine that introducing both this weekly prize per wallet and the proposal in my topic would work.

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What would you suggest for a minimum balance to be eligible for the per wallet jackpot? Needs to be some minimum for that one to work.

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it’s less about the minimum balance per wallet and moreso about the # of prizes awarded. The more prizes awarded the more gas fees for the protocol rise exponentially
I greatly support the concept of adding more POOL excitement & utility but it might be accomplished with larger prizes over much much more frequent ones. We could increase the prize value with additional sponsorships & deposit incentives.

Might be worth to revisit this if/when we have POOL bridged to polygon as gas fees won’t be an issue there!

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I voted against this because I think that optimizing g for growth in TVL is more important than POOL utility at this time.

I like the idea of a one ticket per wallet jackpot, but it will be easier to accomplish in the future when we are a larger protocol. There is not enough interest to divvy up right now. Once the prizes are sufficiently large we can look at distributing the prize interest in different ways, like side jackpots, separate from any reserve money. I would rather structure it that way instead of redistribution from the reserve contract. I dont know if any devs can back me up that logic or if I’m off base. It just seems to make more sense to redistribute from the prize money instead.

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@RegisIsland
Personally I think creating utility for POOL is the fastest way to grow TVL and the per wallet prize would break down the barrier for entry and create a wave of new depositors. New POOL utility makes it more appealing to farm and thus grows TVL. Also makes it more appealing to hold onto your farmed POOL.

@AndyKaufman
In this proposal there would only be 2 prizes awarded per week (one of each type) so gas shouldn’t be a big issue.

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I’m not sure this works, but maybe there’s a way it can. We would need to change the drawing schedule from any week to a much longer interval and probably have to have some cap on the prize size. I’ve looked at some numbers based on the current format and parameters and I get the following:

To create a new address: gas cost to move POOL + gas cost to deposit POOL + gas cost to withdraw POOL is the cost to increase your odds of winning this jackpot. Lets say the user uses 35 gwei with ETH at $2100.

Cost to transfer: $9
Cost to deposit: $18.5
Cost to withdraw: $26

So in total it would cost $53.5 for someone to improve their odds. Each time you try to cheat the system it gets progressively more expensive. It costs $53.5 to double your odds, but the next $53.5 will only improve them by a third… and so on. So each progressive round of cheating becomes less effective.

At the moment the odds for one address to win are 0.087% chance. If cheater spent $642 they would have a 1% chance roughly of winning the draw, assuming others don’t do the same thing, which they probably will. Over the course of the year the would then roughly have a 50% chance of winning the jackpot at least once. If the jackpot is $10,000 that means they spent $642 for a 50:50 chance at winning. For a 5% chance of winning they would need to spend $3,045 and make 58 transactions cycles. So they can spend $3,045 and expect to win the prize at least 2.6 times throughout the year.

Things to tweak:
1). The minimum POOL should be greater than the gas cost to withdraw at a minimum to ensure that the withdraw cost also is a cost of cheating.
2). Extending the gap between drawing schedules will reduce their yearly expectant win rate (i doubt anyone would plan for this being a thing beyond a year, at least right now, might have to address that later).
3). Maybe cap it to 10k or less to disuade cheaters from generating too many tickets.

I haven’t thought about it in great detail, but roughly I think this should be beneficial for fine tuning some idea that isn’t gameable, at least without major inconvenience for the cheaters. One thing that is fair about this is, pretty much everyone that can already use pooltogether is able to cheat.

Edit: I forgot to add the cost to transfer ETH, so the cost is slightly more expensive than I have stated above.

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Thanks for providing this analysis, this is very good info to consider. Definitely would be a good idea to raise the minimum POOL required, maybe 10 POOL would be a good number. Don’t really want to spread out the draws more as I think the biggest buzz will be getting many prizes to small fish. A cap could also be good but if we add a prize cap we should consider making it percentage based so the prize will still grow as the pools grow. Another route using a cap would be adding more prizes as the pools reach new highs.

I might have overthought it above. I think running it for only 1 or 2 months to begin with could work and then you can assess by looking at the blockchain how much cheating happened. For 12 draws any one user is unlikely to cheat too much. I think if users see the signal that it’s happening indefinitely you would create different incentives for cheating. I think the cap should be anchored in some way that makes cheating too time consuming to avail of the edge. If you have 50k prizes every week for example, you can be sure many people are going to create lots of $58 accounts trying to win it.

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@soemfred Distribute part of prices to POOL token holders

I like this idea even more! Distributing a porcentage to POOL token holders would be compliant with the very beggining of pooltogether, which mentioned that in the future, when prizes goes up, there was a intention of retaining 1% of the prize for developers… the proposal is very similar.

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I like the idea of this down the road but my hope is we do that when we have a huge treasury and huge pools. Gas cost is also an issue right now as once you split all the interest up the gas cost for each user to claim would be more than the amount to claim. Hoping we focus on growth now and distribute some interest to holders once we are much bigger.

I like this idea in general! I’m not sure if it is technically feasible though. We would need @Brendan to opine on that.

We’ve also been talking about converting the POOL pool into the “POOL Bar” and using it similar to xSushi. Basically a portion of the reserve would be used to buy-back POOL and that would be distributed to POOL holders… just another idea.

5 Likes

I like both ideas:
1/ Distribute a small percentage of each price to POOL token holders mentioned by @soemfred here. Idea: Everyone owning POOL wins AND one wins BIG! This small % could be compounded into the POOL pool.
2/ Add a weekly prize per wallet,
The first point brings great value to own the POOL token as it becomes a cashflow generating asset, more people would be keen to own it => effect increase the price of POOL token => Increase treasury value,
The second one increases the fun of participating in the pool (double weekly rewards) which can be used for marketing purposes to bring more users to participate and increase the TVL + buying pressure on POOL token too as you need it to be in.

1 Like

Let’s tease these ideas apart and put them in terms of our current system.

We should leave the reserve rates on governance pools at 50% but split it between treasury and POOL pool jackpots

Essentially you want to fund prizes using the reserve.

1 weekly prize per wallet address in the POOL pool with a minimum balance of (1-5) POOL

So you want a prize strategy that limits people’s deposits. This has been discussed before. We could build it, but there is a huge risk it will be gamed. Especially when there are cheap txs (Polygon). It’s significant engineering effort for high risk and low reward.

It’s also not feasible to bolt that system onto existing prize pools, so if we built it it could only be applied to new pools.

Additionally, your thesis is that this will drive up the price of POOL. However- there isn’t significant buy pressure because each person is limited to just a few POOL.

Summary

  • This effort doesn’t increase TVL of the protocol.
  • The central conceit, to drive up the value of POOL, is questionable.
  • This effort is costly in terms of engineering

Counter-Proposal

To drive up the value of POOL we should institute a buyback program and drip it out to existing POOL holders in the POOL Pool

This will have two effects:

  • all fish in the POOL Pool will get more POOL
  • It’s almost zero engineering effort
  • It’s an efficient use of the treasury
2 Likes

I think it’s a good idea. We can do a weekly or monthly raffle per wallet with several prizes of $ 1000, and finance it with small percentage taken from the largest pools without touching the reserves. These will give us small fish by winning and promoting the protocol every week. I believe that every little winner will become a marketer for pooltogether.

I also like the idea that speaks @leighton “a part of the reserve would be used to buy back POOL and it would be distributed to POOL holders”

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To clarify, I definitely am not interested in limiting people’s deposits. The minimum number to be eligible for the prize was more of a sybil resistance to make it less worthwhile to create multiple wallets. There would be no cap and users would be competing for both prizes one of which is based on per ticket which still encourages large deposits.

The buy pressure would come from the combination of larger depositors hoping to win the per ticket prize and smaller depositors who now no longer feel like they won’t bother joining because their chances are so low.

I like this idea and it seems it would be much easier to implement but the one thing it’s missing it does not solve the barrier of entry of little fish who see no point in depositing with such low odds of winning. I see this aspect of my proposal attracting alot of new depositors. POOL pool currently only has about 1100 wallets so the odds of a per wallet prize would be pretty good. Buybacks could be good and hopefully some winners would hold onto the POOL they win.

The keys to my plan are.

  • POOL pool becomes the best place to win the biggest prizes for all types of depositors big and small.
  • Other pools remain the best place to farm POOL and still have great prizes which are now growing due to increased demand for POOL.
  • Big prizes for little fish to get excited about as they’d have a really good shot each week.

I don’t agree with your summary that this wouldn’t increase TVL or increase value of POOL but can’t argue with engineering difficulties of implementing this. The per ticket prize would be as simple as depositing to a loot box(but yes we could alternatively implement a buyback of POOL and send it to the prize), not sure what solutions could be implemented to do the per wallet prize but it could maybe be done via an external contract that collects some of the reserve funds and chooses a winner in the POOL pool to send the funds to. Not sure of the difficulty of this. The per wallet part is the trickiest part it seems but am curious to hear your thoughts on how this could be achieved if we did decide to go down that road.

There is no yield source for POOL though. the prize comes straight from treasury. I dont think the POOL pool will ever be close to as big as the Stablecoin pools. Stables are the bread and butter of PoolTogether.

We’d basically be taking 25% of total interest accumulated in all governance pools. It would definitely be the largest prize by far and would grow as the pools grow.

Also, it would not come directly from treasury it would come from the reserve rates which you are in favour of slashing to 0%.

ah, I misunderstood. However, if the POOL pool becomes the place to deposit would this cause TVL in stabelcoin pools to decrease? which would then in turn decrease the size of the prize for this jackpot?

in terms of reserve rate i only wanted to slash the USDC pool and leave the others as is. My reasoning is that it will help make the USDC pool the most attractive pool to deposit in.

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To clarify, I definitely am not interested in limiting people’s deposits. The minimum number to be eligible for the prize was more of a sybil resistance to make it less worthwhile to create multiple wallets. There would be no cap and users would be competing for both prizes one of which is based on per ticket which still encourages large deposits.

I understood this, but reframed your ask in order to:

  1. Boil it down to the essence of the change from the existing system
  2. Reframe the idea in a way that is technically feasible

The essence of the change is: you want a prize strategy that selects winners based on membership, not deposit size. Restrictions on deposit size are just a detail.

It’s not feasible to bolt it onto existing pools, so it would have to be a brand new pool. Since we don’t want to force the existing POOL Pool users to migrate their liquidity it would have to be a new pool. To mitigate the degree of change across the entire tech stack, that pool would simply be for the membership prizes.

The buy pressure would come from the combination of larger depositors hoping to win the per ticket prize and smaller depositors who now no longer feel like they won’t bother joining because their chances are so low.

This is just a hypothesis. The fact is a very large percentage of people who hold POOL are already in the POOL Pool, regardless of deposit sizes. It’s the best place to put POOL, so people put it there. I don’t think all of a sudden people are going to rush out to buy POOL because the prize is bigger.

The point is, this is significant change and effort for what amounts to guesswork.

Instead of guessing let’s:

  • straight-up buy POOL tokens using the reserve. Direct buy pressure.
  • evolve Pods so that more people win
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Actually what I want is to target both simultaneously. If a new pool were created I’d want it to be one single pool targeting both membership and deposit size, no need for users to choose between the two. One single POOL pool where all the fun happens no matter your wallet size, without any harm to the whales who fund our prizes.

As of now 62MM of the 78MM in the USDC Pool is held by the top 20 depositors. Even with massive pods the odds will still heavily in the whales favour. We need to find a way to throw some bones to the little guys otherwise we are not a platform that is going to make positive change to the world. Just a system where the little guy foregoes his interest to give it to the whales at the top who are making bank collecting their prize and dumping. The key to my approach is both whales and fish having fun in the pool and I think the community wants this and sees value in it. The buyback of POOL would be a great way to do the per ticket portion of the prize but I think we can’t discount the per wallet portion. Not putting large prizes in the hands of little fish will be our biggest mistake and I don’t think marketing a few lucky winners and Pods users getting a fraction of a win is going to solve that.

This is not guesswork it is sound tokenomics. Whales and fish feeding together. What would we need to do to overcome these technical hurdles? There must be a technically feasible way to make the per wallet portion work.