PoolTogether

Reserve allocation discussion

@ageless @mkkoll

Moved this discussion here to keep other topic on Badger trial.

Really like this topic and had seen some good discussion on it on discord as well.
Something we discussed on discord was that if the reserve rate on a pool was changed to 25% there are some good ways to divide those funds to bring more appeal for protocols to work with Pooltogether community. One split I mention was 10/10/5 Pooltogether Treasury/Selected Pool Community(UNI,
Badger, etc) Treasury/Gitcoin contribution.
One thing I left out is that I think some funds should be allocated to a fair jackpot. This could either be achieved by splitting things differently or increasing the amount of the take to 30%.
Option A: 10/10/5 Pooltogether Treasury/Selected community pool treasury/Fair Jackpot. I wouldn’t want to leave out gitcoin as I think it’s important. Maybe in pools like DAI and USDC pools which have a higher yield and no community treasury to donate to we could replace the “selected community pool treasury” field with the gitcoin donation.
Option B: 10/10/5/5 Pooltogether treasury/Selected community pool treasury/Fair Jackpot/Gitcoin.

Back to the discussion of how to pay out the funds in a way that supports other communities. I think in the case of a UNI pool that is collecting 25%(10/10/5) to treasury and 10 of that getting distributed back to UNI, it should just be UNI going back to them to do with as they please. All governance protocols have the same issue with depleting reserves and our contribution could be really helpful once the pools get big. This also keeps us from dumping other protocols tokens.

Interested to see where this discussion goes but I think paying back the ecosystem is a recipe for success. We can always set something up and play with the numbers as we go. Maybe down the road the Pooltogether will be so big and diversified that we don’t need to collect funds for our treasury anymore and can redistribute to POOL holders or to New prize pools.

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Hey @TheRealTuna , just a few questions so I understand it correctly,

1). When you are talking about splitting the funds, are you talking about splitting how the interest of the funds gets distributed or would the principle of those funds be going to other activities such as Gitcoin contribution?

2). Selected Pool Community, would you be talking about taking for example 10 of the 25% of USDC accumulated and then redirecting interest earned in compound to a community pool like badger each week? Or would it be 10 of 25% of all funds accumulated into certain targeted community POOLs, like DAI/USDC/UNI/COMP/etc?

Love this thinking @TheRealTuna!

Redistributing a portion of the accrued interest has 1) historical alignment with how prize savings work and 2) been a very popular idea in governance.

For the purpose of brainstorming… imagine something like:

Imagine something like 30% reserve rate:

  • 10% goes to public goods via gitcoin
  • 10% stays in the protocol and grows prizes
  • 10% goes to the prize of the POOL Pool (I think this is your fair pool)
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@ageless

1- Referring to splitting up the proceeds(Pooltogether share in interest accrued).

2- Badger Pool proceeds Pooltogether share to pay some forward(10 of 25%) to Badger Governance.
Something like USDC that has a centralized governance could pay forward(10 of 25%) to gitcoin contribution.

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I continue to think that the reserve should be left in the pool to increase reward and at the same time the reserve itself

This approach could mean much bigger pools which could mean more stays in the pool and grows it ultimately. Would really boost the appeal of working with and promoting pooltogether.

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ok, think I would be against distributing the principle collected to other community pools; interest would be fine. Gitcoin grants could support distribution of the principle since paying out in POOL might be a disincentive to work on a project for a developer. Ideally, we never shrink the non POOL assets in our treasury during what I see as a treasury accumulation phase for the protocol.

I’m so digging this idea. With PTIP-5 out there, if that’s enacted and passed would this theoretically be the next item in that vein of progress? I personally lean towards either of the options below, but with the caveat that the disbursement happens on some longer period 30 days, 90 days, etc.

  1. rewarding those in the POOL pool by treating that as the fair pool. Disbursements are pro-rated to the length of time spent in the POOL pool for the period. So if someone joins the POOL pool with only 10 days left in a 30 day period, when the tokens are disbursed they receive a pro-rated amount representative of 10 days in the POOL pool.
  2. borrowing the idea of a jackpot that’s award on 1 wallet = 1 ticket basis, IE the DAI pool has 4,555 wallets in it currently, so everyone has a 1 in 4,555 chance to win the jackpot.

I work better with rough examples, in USD cause denomination isn’t the issue.

  • Some pool generates $1,000 in interest

  • Reserve is set to 50%, PTIP-5

  • Thus $500 goes to reserve

    • 50% ($250) rolls back into the pool growing the pool
    • 25% ($125) goes to gitcoin
    • 25% ($125) goes to the “fair” pool, POOL pool or jackpot.
  • Rinse and repeat

  • Assuming POOL pool disbursement from above, 30 day period, 20 persons in the POOL pool

    • A) 10 in for 30 days, B) 7 in for 15 days, C) 3 in for 10 days
      Math for distributions:
      Fractional Amount: 125 / ( 10 * 30 + 7 * 15 + 3 * 10) = .2873...
      Amount to Group A) 30 * .2873... = 8.619...
      Amount to Group B) 15 * .2873... = 4.309...
      Amount to Group C) 10 * .2873... = 2.873...
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