PoolTogether

PTIP-28: Filling the Polygon Pool

PTIP-28: Filling the Polygon Pool

Simple Summary

  • Drip POOL to the USDT Polygon pool.
  • Lower the Uniswap LPing incentive on Ethereum.
  • Prep for Sushi LPing on Polygon.
  • Set USDT Polygon pool reserve to 50%

Abstract

This proposal will distribute POOL from Treasury, through the Matic Bridge to establish POOL on the Polygon network. These POOL would be sent to the USDT Pool Owner. A faucet will be created on Polygon for the USDT Pool. The USDT Pool Owner will deposit the POOL to the faucet. Additionally, this will reduce the POOL distributed to incentivize LPing through Uniswap and move those to incentivize LPing POOL/ETH on Sushiswap.

Motivation

With PTIP-27 adjusting the POOL Drip for a few of the Ethereum pool and a renewed focus on the Polygon Pool (Expanding Stable Coins, Quickswap LPing, and discussion we’ve had in the Friday community meeting as well as discord in general) it is clear that we want to put more focus on L2’s, reward the Poolsters using those L2’s, and expand our presence on L2’s before V4 is launched.

Specification

Overview

  • Drip 50 POOL/day to the Polygon USDT Pool - Time the drip so it would align with PTIP-27, so all drips can be adjusted with one proposal as needed.
  • Reduce Uniswap LPing by 200 POOL/day, the new LPing incentive will be 300 POOL/day as originally discussed in PTIP-10
  • Incentivize LPing on Polygon Sushiswap with an incentive of 200 POOL/day
  • Establish reserve rate for Polygon USDT Pool at 50%

Rationale

The LPing rationale is pretty straight forward, reduce the Uniswap LPing to what was originally proposed, then move the difference to the Sushiswap LPing on Polygon. For the USDT POOL Drip of 50, I didn’t want to create too much competition with the existing sponsor drip so I have stayed conservative.

Technical Specification

  • Transfer POOL from Treasury through the Matic Bridge for POOL (PoS) as noted here to the USDT Pool Owner (PoolTogether Inc.)
  • Create a POOL faucet for the USDT Pool
  • Have USDT POOL deposited to Faucet and Faucet attached
  • Adjust Polygon USDT Pool Reserve to 50%
  • Reduce POOL Incentive to Uniswap LPing
  • Establish Sushiswap POOL/ETH LP
  • Introduce POOL Incentive to Sushiswap LPing
  • Have PoolTogether Inc. verify that the USDT Pool UI can support a Sponsorship APR and Depositor APR

Status

Make it Poolygon SZN by providing drip to USDT Pool and incentives for LPing on Sushiswap
  • Approve
  • Reject (below polls to modify)
  • Abstain

0 voters

50 POOL Drip to the USDT Pool, that’s insane, here’s a better number
  • 25
  • 75
  • 100
  • 150
  • 200

0 voters

Dropping Uniswap incentive to 300? That’s nonsense, how about
  • 350
  • 400
  • 450
  • 200

0 voters

Sushiswap LPing getting 200 POOL? Nah swimmer,
  • 50
  • 100
  • 150
  • 250
  • 300

0 voters

POOL/ETH on Sushiswap? We’re on Polygon let’s get exciting with
  • POOL/WMATIC
  • POOL/QUICK
  • POOL/USDT
  • POOL/USDC

0 voters

1 Like
  1. I am 100% in favour of dripping 50 POOL per day to Polygon USDT.

  2. I support lowering UNI LP back to 300, I’d also be open to 350 or 400 but maybe 300 is the right number?

  3. Incentivizing 200 POOL per day to Polygon Sushi LP seems way too high in my opinion. I am open to some incentivization there.

  4. I thought I had a bit more time on this one and was really hoping to include a Ruler partnership with a bit of a POOL drip to those locking POOL as collateral on Ruler. Would love to add this on but I do need a bit more time to finalize terms with Ruler team. The Ruler team is in the process of implementing some changes that go into effect by the end of July so they haven’t had a chance to follow up with me. I think I might have some finals details ready by mid next week.

1 Like

We need to turn the reserve rate to 50% on the USDT pool as part of this proposal. Other than that I’m good with this as laid out.

1 Like

How does this relate to @Leighton working on a partnership with Sushi for Polygon? I agree with @TheRealTuna, 200 POOL for the LP sounds high with no current market, possible SUSHI incentives, and only 50 POOL a day in emissions.

I did not realize the idea was to add a POOL drip to the USDT prize pool. Kind of confuses the sponsorship drip from my perspective. The USDT pool is quite dynamic with WMATIC price and volatile USDT lending rates. I personally think we should be opening up with new pools on Polygon rather than expanding USDT. DAI, USDC, MATIC… I really see new pools as the marketing tool to bring in new users.

I am for the reduction to 300 of the UNI ETH/POOL LP.

Totally missed that thank you, will add that in now while the post is new

I’m trying to box up all the discussions I’ve seen around for Polygon. Some on bringing Uniswap LPing incentives down so we have some POOL to offer as incentives for Sushiswap LPing on Polygon. Other conversations to bridge POOL over and set up a drip on Polygon so we have so active APR bring people in for deposits. There’s also some chat to get another Pool out there, but I think we need to get this more clerical stuff accomplished first

I am against fragmenting liquidity between uniswap and sushiswap for reasons stated in previous posts. It is not in the interest of new users. There is no subset of trader that trades on sushiswap and not uniswap but there is in the vice versa case. It creates friction for no apparent benefit?

… and I am against incentivising liquidity on quickswap on polygon for reasons stated:

and

It also strikes me as odd that people would vote to incentivise POOL/USDC liquidity pair while at the same time supporting the drip for USDT instead of proposing a new pool for USDC or incentivising liquidity for POOL/USDT. I agree with @underthesea , new pools should be the focus, DEFI predominately uses USDC over USDT by a long way. Maybe we are caught in some cognitive dissonance since USDC is our flagship product on ethereum. It strikes me as irrational any way. Not too keen about putting too much funds towards this either. Ethereum is very usable and has been for many months.

I’m quite confused. We were talking to Quickswap for an LP program on Polygon and now we are talking about Sushiswap. I know @leighton was looking into that but did I miss some decision (based on which parameters?) to go with Sushiswap?

I do agree our focus should be on new pools, but if we are going to focus on Polygon, we need a trading venue which needs to be incentivized. We cannot expect people to bridge back to Ethereum for trading (that’s simply too expensive). I don’t have a strong opinion on whether we should put focus on Polygon though. :slightly_smiling_face:

Sushiswap was discussed on the community call and overall the community there voiced more confidence in Sushi for a number of reasons, stronger presence, multi-layer capabilities, frequently developing new things. Whereas Quickswap is just a fork on an L2 and doesn’t display as much innovation. Leighton began discussions with them and noted the progress in discord so I’ve included it here.

RE: @ageless drcpu is spot on as to why we’re looking to get LPing on Polygon, it costly to navigate across layers just to swap. I’m not sure what the communities motivation for the POOL/USDC liquidity is, I’d love some commentary from anyone as to why that was their choice. I’m preferential to POOL/WMATIC for LPing. In terms are adding more pools on polygon I agree, but we technically don’t have formal governance for L2’s, so a new pool can be made by whomever, there already is a USDC pool and it has not garnered many deposits.

1 Like

I do not think that Ethereum is usable for small fish. Even a five-dollar gas fee is ridiculous in my book. If i want to make a tx then it needs to be at least 500-1000$ for a 5$ fee to not be a significant percentage. Perhaps I’m just poor, but i think there are a lot of people out there like me. there have been plenty of times i wanted to make a tx with 100-200$, but i was priced out. We are potentially missing thousands of smaller players. Fees are literally pennies on polygon. there is a huge opportunity here. Also, V4 will help us aggregrate the liquidity we have across different chains, so we should do everything we can to build everywhere we can. in order to get these users we should use the tools at our disposal to acquire them. i.e. LP rewards on Sushiswap Polygon. there has to be a market for the tokens there. in order to drip tokens there, in order to acquire users.

I am in strong support of anything that grows our presence on polygon. In reply to USDT pool vs a new pool, I would be in favor of creating a new pool. preferably USDC.

here are my suggested new pool parameters:
50% reserve rate
1 Winner per day
200 POOL/day drip
80/20 split on drip to sponsorship/prize eligible depositors.
wMATIC drip goes 100% to sponsorship, or the treasury retains all wMatic (not sure on this point. what does everyone else think?)

2 Likes

I’m a Polygon only user (I don’t even own any ETH and never have).
I agree with @RegisIsland . Polygon is just way better for small fish.

I would like to get some pool tokens on Polygon and even tried to buy them some time ago but there was and is zero liqudity.
I will buy pool tokens as soon as I can there and will provide liqudity myself.
As a pair I’m in favor of Pool/USDC. I don’t want to speculate on the ETH or WMATIC price. If pool goes up I want to make a profit and don’t care about other prices.
And USDC is better than USDT.
As far as I know the only reason we choosed USDT for the Polygon prize pool was and still is the way better APY/yield on AAVE.

I’m a bit sad @ageless is so anti polygon. Polygon is what brought me to Defi and Pooltogether.
At the beginning it was a bit tricky but now I just buy USDT on Binance, withdraw the Binance chain and bridge it to Polygon on xpollinate.

New pools on Polygon sound good. With only AAVE as a yield source we are a bit limited.
An wmatic pool would be possible.
A stable coin pool like USDC or Dai doesn’t make sense in my opinion as long as Apy/yields are still better with USDT.
If we can make Cream work as a yield source on Polygon, we could make a quick pool.

1 Like

Awesome, thanks for the clarification. I usually cannot attend community calls, so I’m missing out on some information. I do agree that Sushiswap has a stronger brand.

We have 5.6MM dollars on Polygon compared to 173MM on Ethereum and what is dripped to Polygon should be reflective of that. Also have a big Ethereum upgrade coming that could make Polygon a little less useful. The total POOL on Polygon should be no more than 100 POOL per day and that should be split between a couple things on there. If 100 POOL per day to the Polygon network starts getting some solid growth we could discuss adding more drip but I don’t think we should go to crazy here. I am for some drip to Polygon but it should be a small amount to start.

I dont think thats a relevant comparison. we have way more TVL on ethereum partly because we have the drips. we have zero drips on polygon, and @leighton highlighted on friday’s call that we are getting more value for the wmatic drip on polygon than we are for POOL drips on ethereum. so if we get more value per $ dripped on polygon we should be pushing more POOL there right? TVL should skyrocket with POOL rewards.

1 Like

What are your top priorities on Polygon? LP’ing on Polygon shouldn’t be 66% of what we provide to LP on Ethereum so that I am very against. If Polygon is for small depositors it doesn’t need a ton of liquidity. Dripping something to the USDT pool and a new pool of some kind makes sense. I’ve heard some good things about Dinoswap lately now that it is live, they were interested in working with us in the past. I just want to be careful how much we drip and make sure it’s dripped in the right place. Want to also leave room for new pools on Ethereum without our emissions running back up to what they were before the upcoming change. I feel like we need a better Polygon strategy then what is discussed in this PTIP and then once we know what were dripping to we discuss how to divide the drip.

Edit: It is actually insane to me that people are voting to drip 150 POOL per day to a Sushi LP on Polygon right now, that is just throwing away POOL.

Agree with @TheRealTuna and this is a reiteration of my previous point but still feels necessary.

Our emissions on Ethereum are 2500 POOL a day. This initiative seeks to recognize an over subsidized LP rewards program with a 40% reduction from 500 to 300 POOL per day. That’s great. The new LP drip is ~12% of our total emissions moving from a previous 20%.

It feels quite dissonant for us to then go create that same surplus on Polygon. The proposed 200 POOL LP with 50 POOL for a prize pool makes for 80% of the emissions going to LP providers. 20% is too much so lets move it over to Polygon and run it at 80%? Not only is the size of the LP compared to total emissions drastically different, but potential Polygon LPs will be subsidized by Sushi or Quick. We also have to keep in mind that for now POOL cannot vote on Polygon and there is no pPOOL (much less utility).

TLDR

  • Current Ethereum 2500 POOL per day emissions with a 500 POOL LP - TOO MUCH
  • Proposed Ethereum 2500 POOL per day emissions with a 300 POOL LP - GOOD
  • Proposed Polygon 250 POOL per day emissions with 200 POOL LP - WAY TOO MUCH

My understanding was that @Brendan 's plan was to create pod tokens on ethereum that could be bridged to not just polygon, by other layer 2s to give users exposure to pooltogether on other chains. This seemed like a scalable solution for all layer 2s. No matter what layer 2 a user is on they have access to the big prizes. Serious liquidity isn’t going to move over to polygon and ethereum is going to keep the majority of the market share of liquidity. A solution that competes with this is foolish I would say and @Brendan’s proposed solution was very nice because it complemented what we are doing on ethereum.

@Taliskye @RegisIsland @Lonser @drcpu I agree with @TheRealTuna , the strategy isn’t been well thought out for this PTIP. Focusing on complimentary solutions with what we have on ethereum as oppose to competing ones are what we should be doing. I think circling back with brendan’s pod concept should be looked at again. @Brendan I might have missed something in the last month or so, but I believe this is still in the works?

I like where you’re headed with the ratio’s. Assuming 250 POOL/day on Polygon is the right amount, that puts USDT drip at 220 and LPing at 30. I’d wager that 220 drip is way too high for USDT and 30 is way too low for LPing as we’re needing to establish a whole new liquidity.

When we initially established liquidity on Ethereum we decided 500 was apt, then forgot to review distributions. So if we assume we’re recreating that, trying to establish a new liquidity, maybe we operate under the current ratio? 200 drip to USDT and 50 to LPing with the understanding we re-evaluate everything in 8 weeks? I think 200 drip is still awfully high for the USDT, so there’s certainly some discussion to be had there.

This was discussed in Discord, but I want to include it here for completeness:

My understanding was that @Brendan 's plan was to create pod tokens on ethereum that could be bridged to not just polygon, but other layer 2s to give users exposure to pooltogether on other chains.

We have plans to accomplish this with V4, so we’re focusing our energy on it! Cross-chain pools with potentially unlimited number of prizes.