PoolTogether

PTIP-4: Implement Badger Pool As Trial Governance Pool

PTIP-4

Link to snapshot Snapshot

Simple Summary

Implement Badger pool as a temporary governance pool. Initiate POOL rewards at a rate of 50/POOL per day for 12 weeks. Apply the prize received from Badger as 200 Badger per week for 12 weeks.

Abstract

This proposal will:

  • Use POOL from treasury to fill a token faucet that drips POOL to Badger pool ticket holders at a rate of 50 POOL per day for 12 weeks.
  • Use Badger received from Badger treasury to fund a prize
  • Give Badger a 12 week Trial as a governance pool.
  • Reward 100 POOL to myself for work on this deal.
  • Reserve rate 5% as is standard with governance pools.

Motivation

This is an opportunity to extend our reach in the DEFI space. Badger is a large fast growing community and this partnership will be very beneficial to our growth. This 12 week period will act as a trial period to test for a longer relationship between our communities. This trial can also help blaze a trail for future pools/communities that we decide to work with.

Specification

Overview

The Badger snapshot vote to contribute 2400 Badger from the Badger Treasury to the Pooltogether Badger Pool has now passed snapshot vote. This means 200 Badger per week for 12 weeks in the Badger prize pool. This is a roughly $100,000 commitment from the Badger community.

I now propose fulfilling a commitment from the Pooltogether community to help build this pool and this relationship. I propose granting the Badger Pool a trial period as a governance pool for 12 weeks. Our agreement in principal is 50 POOL per day and I think this is in line with the commitment from the Badger community. This is far less than the current rates of the UNI and COMP pool but given that there is talk of reducing all pools I see this a a good starting point for this trial period. Badger is a large and successful community and I hope our community can see the value in building this relationship and rewarding the Badger communities commitment.

Possible roadmap in building Badger and pooltogether relationship.
1-BIP 42 goes to snapshot and passes.
2-PTIP proposal goes to snapshot and passes.
3-Badger pool funded and 12 week trial begins.
4- Yield source bounty created by the Badger team.
5-Pool grows as Badger holders earn POOL and have fun winning prizes.
6-Yield source added before end of 12 weeks and users stay in the pool.
7-Possibility of POOL rewards extended.
8- Possibility of bringing in more Badger products.

Rationale

Reserve Rate: 5% (standard rate for governance pool)
Rewards rate: 50 POOL per day for 12 weeks
Prize: 200 Badger per week for 12 weeks
Featured on main page with governance pools for 12 week
Reward to myself: 100 POOL As was brought up in the community call on Friday I have added a 100 POOL reward for negotiating the Badger and Pooltogether partnership. Thank you!

Technical Specification

  • StakePrizePool for Badger
  • TokenFaucet for POOL
  • PrizeChunker for BADGER

StakePrizePool

View in Reference App

0xc2a7Dfb76E93d12a1bB1Fa151b9900158090395d

TokenFaucet

0x40f76363129118b34cc2af44963192c3e8690ba6

4200e18 Pool over 12 weeks = 4200e18 POOL over 7257600 seconds

=> 578703703703703 POOL / second

Configured to drip POOL as measured by TBDGR at 578703703703703 POOL / second

Prize Chunker

0x526396E6Df883d145f28c76d078f819b56bCC2fA

PTIP

  1. Pool.approve(TokenFaucet, 4200 pool)
  2. tokenFaucet.deposit(4200 pool)
  3. Pool.transfer(Tuna, 100 pool)

Status

Implement Badger as Temporary Governance Pool / Set Rewards to 50 POOL/day for 12 Weeks
  • For
  • Abstain
  • Against

0 voters

4 Likes

I have only followed this with half an eye, so let me see if I understand this proposal. Essentially, we’d open up a new Pool where Badger token holders can deposit their tokens? Their treasury would sponsor 2400 Badger to fund the prices (~100k USD) and our treasury would sponsor 4200 Pool (~85k USD) by means of yield farming?

If the above is the case, I’m not quite sure what we as a community are gaining from this except maybe some extra exposure? Assuming most of us don’t hold the Badger token, we cannot participate in the pool (if we don’t buy some) and are essentially giving away tokens? This seems like a win / win for Badger token holders (they stand a chance to win extra tokens from their treasury while also gaining POOL tokens) without much tangible benefit for us?

This is big exposure for Pooltogether and the rewards being provided are very low in comparison to the other governance pools. Badger team has also created a bounty to add the yield source. This is an experiment that I believe will develop into a long term pool and more pools to come as Badger has several products launching. This is of great benefit to both communities and can help accelerate our growth. I hope this is a big success and we can onboard more communities in a similar way.

2 Likes

Here are my thoughts:

Pros:

  • I love the initiative @TheRealTuna has taken and I think supporting community led initiatives early on is super important
  • I love experimenting with partnership with other protocols and moving quickly
  • I love the idea of experimenting with limited runs of POOL distribution

Cons:

  • I don’t like that there is not an actual yield source
  • Not sure if it makes sense from an POOL distribution perspective

That’s my perspective, overall, I’m supportive of doing it as an experiment and also to support the community led initiative! I think we need to do a lot of stuff like this and see what works the best!

2 Likes

I’m not really against it, but I also find it difficult to see a clear benefit. Given that the proposed rewards are indeed relatively small and limited in time, I guess I’ll abstain.

@TheRealTuna - I’m really concerned about these in the long run. How do we get around this as a community?

I think we will grow really big really fast and won’t need to be so aggressive. In my opinion this whole thing put a bit of pressure on the badger team and made them take a longer look. We now have a bounty in place for the Badger yield source. I am passionate about both the Badger and pooltogether communities and really wanted to kick things off.

In future if we were going to try and broker a similar deal. We could ask for the following:
-commitment to yield source.
-contribution to prize.
-a payment to the pool treasury

On a side note, keep an eye out when/if Badger pool starts. I have a little surprise I’ve started working on with a friend. My next fun project to help Pooltogether community.

Could you expand on what Badger is doing to get a yield source in place?

What’s the plan after the yield source is created? A pool cannot be switched from Stake to Yield so a new Badger pool (likely community) would need to be created when the yield source is initialized. Do we have any soft commitment that Badger would continue the partnership after establishing the yield source?

I’ll reserve some of my other questions for later. Overall my big take away’s here is that Badger is getting a great deal, they get to drop their tokens for a chance to win some and get some POOL tokens. I think the math for it comes out pretty small for the whole run 4.2k POOL tokens. Badger isn’t a tiny protocol (or the algo gods are tricking me) and this partnership can bring a lot of notice to PoolTogether, seems like a fair cost at this point in the timeline of things.

I would be leery of this becoming a norm and we should encourage that a yield source be available in the future so we don’t need to offer POOL tokens as the carrot to make it happen. I am For this and look forward to swapping into a few Badger tokens to participate, I think this is the right time to experiment and I think the PoolTogether cost is acceptable, currently.

1 Like

Reserve rate cut to 0%… It was already a great deal for Badger with the current 5% reserve. Almost feel like it’s a kick in the teeth if they squeezed that change in? If we are already too far through the negotiation so be it but ideally we should be raising the reserve on the pool to reflect the token value distribution between the communities. Are we too far past to discuss that with them?

Just from the perspective of an on going partnership it would make sense for our treasury to take in badger. When badger gets a yield source we could then use that badger as sponsorship for the badger pool.

1 Like

@Taliskye
Badger developers are buried in work and can’t commit the dev time to adding the yield source so they have put up a github bounty for a community member to do the work.
Badger’s yield is from staking so I think the pool would not need to be changed. I’ll look into this in case I’m misunderstanding anything.
Once yield source is in place backing out wouldn’t accomplish anything as we have a pool with a yield source and Badger holders can use it. Badger is a DAO and the Badger community voted this in, they are not backing out.

@ageless
It’s a great deal for both sides. Reserve rate kicked in while I was still working on this and I just don’t think it’s a good look to take a cut of a donated prize. 5% reserve cut was not mentioned in the BIP vote that the Badger community voted for. Nobody from either side has questioned the reserve rate but I am just trying to keep things transparent. If the community does not like the 0% reserve rate I am willing to change but worry about upsetting the Badger side when 5% reserve rate was in the works while negotiation process was happening.

I think Badger has made a great commitment here and I hope we don’t nitpick at the deal and make things difficult. I plan to be proactive in trying to make sure this goes far beyond 12 weeks. I hope the community is good to give this a chance, I’ve spoken to many Badgers who are excited to join the pool.

3 Likes

Ok sorry, I thought they were the ones that nitpicked it down to 0%; didn’t realise they weren’t aware that’s how the Pooltogether protocol was fixed right now. Also aware when you opened the negotiations none of us thought it was practical to have custom reserve rates per pools and there was not much that could be done about the 5% rate.

I still think it could be worth going through the pain to discuss how the badger can be on our books for future use as sponsorship. At the moment badger holders will receive around 200k worth of value over 12 weeks; that is the headline. I know there are indirect benefits, but arguably Badger receives a lot of them in return too. The most obvious of which might be Badger community member learns about POOL and invests in POOL could just as easily be POOL community member learns about badger and invests in badger. It’s not easy to measure the indirect benefits. I would prefer to see a fairer economic split of the measurable value. We will probably want to have Badger in our treasury acting as sponsorship for whatever our future partnership looks like.

Congrats on the work you’ve done to get us to this point with it in any case. I have already committed to support it, but the terms could be better arranged, to the benefit of both communities, to reflect the intention that our partnership will exist beyond the trial period.

If it’s a big deal we can leave it at the 5% that is the standard now. I have just never mentioned the reserve rate in my pitches because it was still up in the air when this started.
I just want things to keep moving here, feels like community has agreed but I can’t get much from anyone about the next step forward. I’d like to make my final updates and put it to snapshot vote here.

Edit: I guess the 5% reserve rate will be good for everyone longterm. I will make that adjustment on the PTIP for now.

Thanks Tuna, you’re not misunderstanding anything from my post, they were all points of curiosity. I think this is an interesting idea and a great initial framework for partnerships. You blazed trail.

I really appreciate @TheRealTuna’s efforts in on-boarding other protocols to PoolTogether. This can potentially bring a whole new group of users to us, which could increase adoption and visibility.

While the economics of this proposal are heavily in favour of Badger token holders, I think it’s okay as a trial run. We’ll learn what works and what doesn’t over time. I think we should have dug a little deeper into the economics and logistics of the proposal and developed a deeper consensus in the community.

Now, some feedback:

In terms of the partnership, I think a strong partnership would have been PT helping Badger build the yield source integration. This could have come in the form of a developer grant. Ideally, we wouldn’t have needed this proposal since Badger would have simply created a prize pool for themselves. This proposal isn’t much of a partnership; it’s PT giving away POOL tokens.

Very little to no analysis was done on the economics or logistic of this proposal. Who will be rewarding the pool? If governance decides to reward it, is it worth $500 / week? Or whatever the frequency is? Since it’s a stake prize pool, when rewards run out will governance have to run a proposal to remove it from the automated rewards? There are so many aspects of this that haven’t been analyzed. This proposal was rushed and lacked any detail.

Conditional proposals are very fragile. Essentially, Tuna went and made promises to the Badger DAO that depended on PTIP proposals. This makes governance much more complicated, and should be avoided in the future. What if PT rejected the proposal? Would we then have a proposal to transfer the tokens back?

All that being said, I think this is a worthy experiment. It’s also a great opportunity for the PT community to learn.

1 Like

Very Well said Brendan. I think the entire ethereum eco system has been built on moving fast and breaking things. I commend tuna as well for taking the initiative and I have no doubt that the the tunas intentions were good. I believe introducing the badger community to pool together will provide a benefit to PT. I do however agree that we should take a little more time to digest things and analyze as many angles as possible before decisions are made. I think we need to realize that we do have time to analyze these things. Perhaps one thing we could use the POOL treasury in the future for is to issue bounties on tokenomic/financial analysis. Bounties don’t have to all be development related. I believe that a strong data analysis team member would be very beneficial.

I mostly share the same sentiment as you, I feel like, while it may be a useful experiment, it essentially comes down to PT donating POOL to Badger holders without any tangible return.

That being said, I do have a question because your 4th paragraph makes me doubt and I don’t know all the technicalities related to the implementation of a Governance Pool. I assume it is possible to award 50 POOL / day for 12 weeks as proposed and after that just stop? I’m not exactly following the automated rewards remark.

https://snapshot.org/#/pooltogether.eth/proposal/QmcnXbDGRnk4Jmt244qmckzpoV3EyQR7kDPZzpZyaxZh9D

I assume it is possible to award 50 POOL / day for 12 weeks as proposed and after that just stop?

Yes, it is possible! I’m helping Tuna work out the technical details. More information will be coming shortly!