ARC-31: Incentivise ampLUNC-LUNC liquidity on Terra Classic

Proposals
1

References

Due to the similarity to STEAK, parts of the proposal have been applied from ARC-18: Incentivize STEAK-LUNA liquidity

Proposal

Incentivise ampLUNC-LUNC LP with ASTRO incentives

Background

ampLUNC is the Terra Classic Version of the Eris Protocol Liquid Staking Derivate (LSD). It is similar to Lido, Stader, Prism and a fork of Steak. Users deposit / stake LUNC and receive ampLUNC in return. ampLUNC can be seen as a receipt to receive back the deposit with all auto compounded rewards. As staking rewards are autocompounded, the exchange ratio between ampLUNC and LUNC changes, with each day ampLUNC becoming worth more LUNC. More details can be found in our docs Amplifier

Right now Eris Protocol is the only working LSD available to Terra Classic and we would like to provide the LUNC community with a functioning LSD protocol on Terra Classic DeFi. When IBC on Terra Classic is re-enabled, we intend to IBC ampLUNC to Terra and bring all LUNC users closer to Terra 2 DeFi. Ideally, an exposure to how Astroport works with its generator, fees, incentives, providing liquidity and swapping of tokens will be great onboarding tools for the new LUNC users. This makes Astroport Classic an ideal playground for them to learn how to use DeFi.

While we are a fork of previously developed Steak by Larry0x on Terra Classic, we are not affiliated with him in any way, but want to continue developing around the protocol and bring all amp[TOKEN] from within cosmos to Terra 2 DeFi.

We try to continue with the same philosophy set by STEAK, with the difference that we have a 5% protocol reward fee, to support further development and transaction fees. Also our vision for developing Eris Protocol goes further than only liquid staking: https://docs.erisprotocol.com

We do not have any platform token to extract value from the user and are fully self funded.

  • Zero money raised from VCs: developers worked completely voluntarily, paying for expenses out of their own pockets;
  • Committed to support non-institution, community-based validators, especially those who contribute to open source projects, run self-hosted servers (instead of cloud-based ones), and provide crucial infrastructure services for the Cosmos ecosystem (e.g. IBC message relaying). All our validators are monitored for governance and community participation.

Motivation

When looking at the on-chain interaction data, we still see many transactions from new Terra Classic Community members. Many of which are not yet familiar with DeFi or how to interact with the chain.

We see the support of Terra Classic as a great way to onboard and educate new people in the Terra Ecosystem and want to make the transition for them as easy as possible to Terra 2.

We also believe that this brings great value to astroport, as we can support moving the community over to Terra 2 when IBC is enabled again and start bringing volume and TVL to Astroport.

All while bringing the advantages of liquid staking to Terra Classic and improving decentralization, by spreading delegations between many validators that are not in the top.

Specification

We propose that the Astral Assembly rewards the ampLUNC-LUNC LPs with an alloc_point value of 94,000 in the Generator contract.

This is comparable to the level of incentivization given previously to stLUNA-LUNA (alloc_point of 94,000) and LunaX-LUNA (alloc_point of 66,650 proposed).

Copyright

Copyright and related rights waived via CC0.

1 Like
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Thanks, @Philipp , I do agree that non-functioning protocols should have their alloc_points set to 0.

2 Likes
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Hey @Philipp

Thanks for the proposal. I’m using Eris on Classic as a liquid staker and would be happy to provide liquidity if the pool gets incentivised (not really much point at current yield).

Reading through your post though I think it needs to be separated into 2. I find that the inclusion of discussion about removing incentives muddies the primary purpose of the proposal. It’s probably not helpful that you have a competitive interest in getting some of those pools de-incentivised.

Removing incentives needs a clear rationale. You’ve provided "not functional on Terra Classic? and “do not work anymore or abandoned Terra Classic” as the basis. There seems sense in those but arguably almost every single currently incentivised token could fit under these definitions. Yet, even with things being broken, people are still staking and trading, as meme coins, on Astroport Classic. That’s generating fees for Astro stakers so would there be risk for Astroport’s value as a platform on Classic if we culled hard and ended with only a few tokens incentivised?

The burn tax seems to have had an impact on volume generally but to me the reality is that Astroport Classic is a meme coin trading dex, for the time being, because Classic is a meme coin chain until real development of apps starts up again (if it does). Most volume is taken up by just a few LPs but 2 of them are either on your list (MIR) or could be qualified for it (ANC) and account for nearly 30% of the last 24 hr volume. I am in neither pool.

MIR-USTC has 17.6m USTC value staked with daily volume still around 1 million. I think t’s all a bit mad with what’s happened with MIR but nevertheless people are staked and trading it. Similarly you could argue Anchor is not functional but there’s 27.5 million USTC staked to it and 2 million volume in the last 24 hours. (LUNC/USTC is the main pool and accounts for upwards of 70% of the last 24hr volume). Will we retain that activity if the pools are cut? Maybe.

Also there’s some complications re what constitutes functional eg the Lido tokens have had their front end disabled but their smart contracts are still running and can be accessed via command line interface. It’s very impractical for the average user but they are arguably still functional. bLunac/Lunac pool has nearly 7 million USTC value staked to it. Volume small so really it’s not doing much for Astroport but bLunac stakers (I’m not one) might have an argument with you re cutting them off. Btw Terra Rebels have a project to deliver the Builder incentives voted on a couple of months back Lido is one of the protocols that are currently white listed to receive airdrops.
This is the current official list for that, you should get Eris on to it.

I’m going to suggest to dfunk that he makes contact with you.

I agree we need to have a discussion about the current distribution of incentives but it should be a separate proposal, should define clear parameters for pools to maintain (or lose) incentives and should probably have a sunset process.

1 Like
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Hey @DavidS,

I think you are totally right. Unfortunately I can’t edit the proposal, but we should leave the removal of not functional pools out of the proposal.

I will also reach out to dfunk about the airdrop.

Best Philipp

1 Like
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Hi Phillipp

Are you planning to put this proposal up any time soon? At least the key part to incentivise the ampLunc pool?

cheers

6

Hi David,

yes that makes sense, but finding ASTROC holders and getting to the quorum will be interesting.

Message to execute - alloc points the same as for LunaX?-LUNC - see https://classic.astroport.fi/governance/proposal/7

{"add": {"lp_token": "terra1x869hqq8483tc3qc6pdhnmcqnfkccftvwqvp8d","alloc_point": "94000"}}

Message as base64

eyJhZGQiOiB7ImxwX3Rva2VuIjogInRlcnJhMXg4NjlocXE4NDgzdGMzcWM2cGRobm1jcW5ma2NjZnR2d3F2cDhkIiwiYWxsb2NfcG9pbnQiOiAiOTQwMDAifX0=

Message to input in governance

[{"order":"1","msg":{"wasm":{"execute":{"contract_addr":"terra1zgrx9jjqrfye8swykfgmd6hpde60j0nszzupp9","msg":"eyJhZGQiOiB7ImxwX3Rva2VuIjogInRlcnJhMXg4NjlocXE4NDgzdGMzcWM2cGRobm1jcW5ma2NjZnR2d3F2cDhkIiwiYWxsb2NfcG9pbnQiOiAiOTQwMDAifX0=","funds":[]}}}}]

I will check with the community if they would be down for the vote of setting the alloc_points on ampLunc-Lunc.

As I do not have the rights to edit the main proposal, is the update here. The message corresponds only to the first part of the proposal of incentivizing ampLUNC-LUNC similiar to other existing LSD paris on astroport:

We propose that the Astral Assembly rewards the ampLUNC-LUNC LPs with an alloc_point value of 94,000 in the Generator contract.

This is comparable to the level of incentivization given previously to stLUNA-LUNA (alloc_point of 94,000) and LunaX-LUNA (alloc_point of 66,650 proposed).

No other pools are touched or changed by ARC-31

Best Philipp

1 Like
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Thanks Philipp.
Yes, quorum may be challenging - not a lot of attention on Classic governance I fear. We can but try. Proposing to incentivise the team that’s actively trying to build is very much fair and reasonable.

1 Like
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The proposal has been posted: https://classic.astroport.fi/governance/proposal/13