ARC-21: Incentivise v2 Prism Protocol cLUNA/LUNA LP

Proposal

Incentivise upcoming v2 Prism Protocol cLUNA/LUNA liquidity pools in Astroport. The purpose of this proposal is to create a deep stableswap pool of cLUNA/LUNA on Astroport to support Prism Protocol’s assets.

The proposed alloc_points for cLUNA/LUNA is 15k.

Background

Prism Protocol is a Terra native derivatives protocol that allows users to refract digital assets into two distinct parts: a yield component & principle component. This allows users to access the utility of its individual parts separately. With over $500mil locked in Terra v1 pre-LUNA crash, Prism Protocol has indicated a massive relaunch with a new roadmap with a renewed focus on fixed term Prism assets.

Motivation

With over $500mil TVL locked in Terra v1, Prism Protocol was a blue chip protocol that amassed its own community, sustainable revenue fee generation with a stable 20% APR on its own governance token. In the recent Emergency LUNA allocation to Terra builders proposal, Prism Protocol has indicated that they’re relaunching on Terra v2 after accepting the emergency LUNA allocation.

The motivations to incentivise the cLUNA/LUNA pool were:

  1. Incentivise Prism Protocol to utilise Astroport’s stableswap pools as its default pools for future Prism assets like fixed term LUNA (eg. 12month yLUNA).
  2. Leverage on Prism Protocol’s strong community following on Discord, Twitter & Telegram.
  3. Bring about higher swap volume due to the speculative nature of fixed term assets.

With several protocols deciding against launching on Terra v2, this allows Astroport to solidify its position as the default DEX and its role to support one of the key protocols on Terra v2. An incentivised cLUNA/LUNA LP will ensure that a deep liquidity is built on Astroport from the get-go.

Benefits for xAstro holders:-

  1. Higher swap volumes due to the speculative nature of Prism assets.
  2. Higher swap volumes translates to higher buyback on ASTRO tokens, which equates to higher APR for xASTRO holders.
  3. Disincentivising Prism to be sniped by orderbook protocols launching throughout the Cosmos ecosystem.

Benefits for LUNA ecosystem:-

  1. Increasing diversity of validators & voting power of delegated LUNA by implementing proxy governance on Prism Protocol rather the inaction of liquid staking protocols to implement proxy governance.
  2. Establishing an innovative protocol on Terra that isn’t seen on other chains.

Should this proposal be passed, the cLUNA/LUNA stableswap pool will be incentivised with 31.5k ASTRO tokens daily (~$1,256/daily, assuming ASTRO = $0.0399).

At an average of LUNA staking of 12.7% APR, we will see no less than $3.6mil TVL on the cLUNA/LUNA stableswap pool. This builds up a deep liquidity pool on Astroport for lending protocols to utilise the TWAP of cLUNA directly from Astroport.

Copyright

Copyright and related rights waived via CC0 1.

[End Proposal]


5 Likes

I’ll vote YES if PRISM holders will receive their tokens 1:1 back on Terra V2 or any other blockchain.
Until today this is still unclear. If PRISM holders don’t get their tokens back after investing in the forge and buying on the market then what’s the point of believing in a future? Incentivizing such a project doesn’t feel right when people are left out because of the Luna crash. As an ASTRO and PRISM (on LUNC) holder I’ve seen with ASTRO how to relaunch a project. I hope (and think) everyone understands this. But again, if it’s done right I’m definitely voting YES for this proposal.

1 Like

Astro v2 needs more trade volume. The Prism Swap AMM on Terra Classic was attracting significant trade volume that would greatly benefit ASTRO holders on v2 from a fee generation perspective. I think it should be a priority for Astroport to bring the prism derivatives trade volume and liquidity to help bolster the Astroport AMM.

Whilst I’m not convinced that the cLUNA/LUNA pool will bring huge volume, as we can see with the LUNAX/LUNA, STEAK/LUNA & ampLUNA/LUNA pools, the potential for Prism asset pairs is exponentially greater than these competing pools & thus should be incentivised accordingly.

I’d also like to see some commitment from Prism that they will add dual incentives once they launch their own token.

Definitely a NO because they have not committed to airdrop old PRISM holders tokens 1:1 back on Terra V2 or any other blockchain.
Until today this is still unclear. If PRISM holders don’t get their tokens back after investing in the forge and buying on the market then what’s the point of believing in a future? Incentivizing such a project doesn’t feel right when people are left out because of the Luna crash. As an ASTRO and PRISM (on LUNC) holder I’ve seen with ASTRO how to relaunch a project. I hope (and think) everyone understands this. But again, if it’s done right I’m definitely voting YES for this proposal.

@8punt6 , @carlicahn73 , while Prism did not agree to an airdrop in their latest Medium post, I’d like to iterate they did not confirm that they will not be doing the airdrop too. Even if an airdrop is done right now, there isn’t any revenue to Prism until they launch the protocol, the token will just be dumped on the open market. I would much rather have a token with value accrual rather than some useless token that’s inflated.

As this proposal is targeted for Astroport, I’m raising this proposal with the hopes that, one, Prism uses Astroport as the main DEX for their token launches, including fixed term. @AstroMan , if I’m not mistaken, the cLUNA/LUNA LP pair is needed for them to issue fixed term assets, as cLUNA is the combined token for yLUNA & pLUNA, therefore, its a pre-requisite. Also, cLUNA stands to have higher utility vs their LSD counterparts which are predominantly used only for lending protocol collaterals.

3 Likes

@MaxCallisto Surely PRISM can at least announce publicly they will issue equal tokens to PRISM users after it launches?

Astroport gave its tokens to users in V2.
Stader had an ERC20 compatible token, so folks still have it despite LUNC crash.

Prism was a large protocol in LUNC and it would be a shame for PRISM not to support their forge backers. Probably use LUNC data, but I would prefer to see airdrops from PRISM. Given the low utility of LSDs so far, I don’t see a reason to push hard on this proposal. Overall, supportive, but PRISM protocol needs some community building.

2 Likes

I know Prism didn’t confirm anything yet and I do agree with you that they should first have some revenue (to avoid token dumping) before relaunching their token.

But restraining from commenting on the future of the PRISM token is not fair to PRISM V1 token holders and investors. And I don’t see it as something like an airdrop because that’s commonly associated with free tokens. I rather think it’s a normal relaunch of the token from Terra V1 to V2. Almost every project which continued did this in some kind of similar form.

2 Likes