ARC-102: Begin implementation of new vxASTRO 2.0 and accompanying tributes protocol

Proposals ARC (Astroport Request for Comments)
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Summary: This is a signaling proposal to gauge community sentiment on a new design for vxASTRO. After incorporating any relevant community feedback, this proposal will be taken to a vote. If the community signals interest/approval in that vote, the coding work required to deploy it will kick off. Once the code is complete and audited, a new proposal will be created seeking approval to deploy vxASTRO 2.0 and tributes on Neutron.

When Astroport governance voted to move the Hub to Neutron, a key part of the agreement included resurrecting vxASTRO and launching a generalized voting incentives protocol on the Astroport Hub on Neutron.

Today, we’d like to share our ideas on a new design for vxASTRO, so we can gather feedback and gauge community interest in kicking off coding work for the new design.

Concerns with the initial vxASTRO design

The initial vxASTRO design (as described in the vxASTRO Utility section in the original litepaper) was inspired by Curve’s pioneering veCRV model and featured the following utilities:

  1. Ability to lock xASTRO tokens for up to 2 years for non-transferable vxASTRO tokens
  2. No ability to unlock tokens until the lock expired
  3. Boosted voting power (a 2 year lock would earn 2.5x power)
  4. Boosted ASTRO emissions when you provide liquidity (2 year lock earns 2.5x boost)

Two core concerns over this approach have been raised by the community and other ve-derived tokens:

  1. Prolonged lockup of tokens
  2. Centralization of voting power granted to a few large holders

To address these concerns, we propose a more streamlined approach dubbed “vxASTRO 2.0.” This approach would remove boosted emissions and governance power, and replace them with “tributes” via a generalized voting incentives marketplace.

vxASTRO 2.0 and Astro Tributes

Designed for maximal flexibility, vxASTRO 2.0 would have the following features:

  1. ASTRO holders could stake ASTRO for xASTRO, then optionally lock that xASTRO for non-transferable vxASTRO
  2. vxASTRO holders alone would have the ability to vote on future $ASTRO emissions decisions in 2-week voting epochs
  3. xASTRO and vxASTRO holders would both have 1:1 voting power on general governance proposals (i.e. no boosted voting power for vxASTRO holders as originally planned per the Astroport litepaper)
  4. xASTRO lock-ups would be indefinite while allowing users to unlock their tokens at any time with a 2-week waiting/unlocking period
  5. LPs who hold vxASTRO would not receive boosted ASTRO emissions like they would have under the original proposed design
  6. A Curve-style voting incentives or “tributes” protocol (as mentioned in the Neutron Hub move proposal) would be launched with tributes going exclusively to vxASTRO holders (more on this below)
  7. Emissions voting would take place on Neutron (Astroport’s future home for governance), and vxASTRO holders would be able to vote on emissions on any chain where Astroport has an outpost

Under the vxASTRO 2.0 model, xASTRO lockers could elect to vote for the pools where they’re actively LPing. Or they could be enticed to vote for other pools via voting incentives, or what we’re calling tributes.

While the concept of voting incentives has negative connotations, they will inevitably exist in a permissionless system. If we accept that they exist, it makes sense for the protocol to internalize them as tributes or donations and distribute fees from them to stakers.

In effect, it creates a free market for governance incentives. vxASTRO holders can either vote on the pools they prefer, or vote on pools that have received tribute donations in order to capture those rewards.

To illustrate the tributes process, imagine a user who wants ASTRO rewards to go to a NTRN-OSMO pool. If they do not hold vxASTRO, they could encourage other lockers to vote for that pool by donating tokens (i.e. “paying tribute”) to anyone who DOES vote for the NTRN-OSMO pool. Tributes could be paid in any on-chain token (i.e. NTRN, OSMO, USDC, ASTRO, etc.). Then, any vxASTRO holders who votes for the NTRN-OMSO pool within that voting period would be able to claim a pro rata share of that pool’s tributes.

With this approach, vxASTRO 2.0 meets all its core objectives. Specifically, it eliminates long lockups and prevents centralization of emissions decisions (via boosted voting power) while also rewarding vxASTRO holders with the rollout of the tributes protocol.

Conclusion

vxASTRO 2.0 has the potential to:

  • Reduce centralization around emissions decisions
  • Eliminate excessive xASTRO lock-up periods
  • Create a framework for an accompanying tributes protocol
  • Ensure ANYONE can influence ASTRO emissions and liquidity provisioning decisions throughout the Cosmos with whatever token they’d like to use

Delphi Labs and Astroport contributors are excited to bring tributes to the protocol. Combined with the alternate vxASTRO design, it will bring flexibility to voting for emissions and add a new dimension to Astroport, which could initiate a new epoch in the AstroWars.

What do you think of this new design? Please share any improvements that you’d like to see!

Copyright

Copyright and related rights waived via CC0.

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Hi Astrochad,

  1. From the design model, vxASTRO has governance rights and ability to obtain “tributes”, but will there be additional lock-up period vs xASTRO (which has a 2-week lockup period).
  2. While Neutron is the governance hub of ASTRO, governance should be able to be accessed via any chain rather than the need to bridge over to Neutron to perform governance-related actions. While each outpost has its own pools, the governance page of Astroport in every outpost should have a consolidated list of pools.
  3. Will there be a limit to the pools that ASTRO emissions can emit to? Having too many pools being incentivised will dilute the impact of the ASTRO emissions. Would suggest to limit to no more than 10 pools.
  4. While the need to emit tokens is part and parcel of ASTRO tokenomics, an idea is to have part of the trading fees kept in ASTRO or any blue chip tokens as part of Astroport’s treasury for community development. For example, 5% of the total fee generated shall be kept in an EnterpriseDAO in the form of ASTRO, wBTC or wETH for community development of dApps for Astroport. This DAO could be governed by Astroport governance or a separate mechanism could be considered.
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Hello!

I have a few questions about veToken. there are two types of veToken, forward-looking (CRV) and backward-looking (GMX), why did you choose the former for ASTRO?

CRV and GMX have different Tokenomics structures, so a simple comparison cannot be made, but at the moment the lock rate for CRV is 41% and 74% for GMX. Personally, I believe that backward-looking allows for more rational governance participation and regular turnover of participants.

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Great feedback! Here’s a blog post with more info on the tributes model: Astro Tributes: A new voting incentives protocol for the Cosmos

To your specific points, though:

RE #1: xASTRO does not currently have a 2-week lockup period. That would stay the same if this proposal is approved and vxASTRO is launched. Only vxASTRO would require a minimum 2-week lock.

RE #2: Vote incentives will be able to be created on any chain, and they will only be able to be claimed on the chain that the incentive was created on. Users will also be able to vote on governance and emissions from any chain. Votes will be IBC’d to Neutron in the background.

RE #3: Good suggestion. We do not currently imagine limiting the number of pools. However, past vx- token models have suffered from permissionless pool voting, allowing whales to direct emissions to liquidity pools that they fully control. To prevent this, only whitelisted pools will be eligible to be voted for. Liquidity pools can be added to the whitelist through the Astroport governance process, so it will be up to all of us to decide how many pools that is.

RE #4: Love this suggestion and feel it’s long overdue. However, it feels like it should be a standalone proposal.

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Great question. We’ve been thinking about the two different approaches like this:

  1. A committed up-front lock up (crv)
  2. Accruing points as you stay locked (gmx, platypus).

The GMX/Platypus model is interesting but it benefits earlier lockers the most. The CRV model weakens your voting power over time unless you keep re-locking for an incredibly long time.

With this vxASTRO proposal, the approach is more straightforward. Beyond the 2-week minimum lockup requirement, there is no bonus to staying locked for extended period.

Just before a new voting epoch begins, a snapshot would be taken to determine voting power for the next 2-week epoch.

This approach maximizes near-term engagement at the expense of locking in users for the long-run. If tributes and general emissions voting as part of the AstroWars prove popular, that near-term engagement should translate into long-term engagement.

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That is an interesting perspective! Certainly, capping multipliers in a GMX-type model (e.g. 100 days) and capping the lock period in a CRV-type model(e.g. 2 weeks) would have a similar effect to prevent monopolization by whales or people who almost mistakenly locked many tokens for a long time unreasonably, and would reduce the difference between backward and forward types.

By the way, where can we find ASTRO’s latest emission schedule? I believe that a high inflation schedule is not necessarily evil because by varying the inflation rate, you can decide whether to favor the old players or the new players.

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Governance has made some adjustments, but you can find the initial schedules here: Allocation | Astroport Docs

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Hi Admin @AstroChad_fi or anyone else I have a question :raising_hand_man:?

I had my Astro staked before UST depeg how can I access those coins please?

Thank you

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