The problem is there are two frameworks - the old and the new. Incentives were given to LunaX, ampLuna, and bLUNA under the old framework - where a new LSD got an equal share of incentives going to incumbent LSDs. Now there’s a new framework, whereby a new LSD would get a much smaller amount of incentives. This gives an unfair advantage to incumbents.
But things change, that’s true. And there are often advantages to being first.
Unfortunately, the new Incentives Framework limits incentive reduction to 25% in an eight-week period. I estimate this means that LUNA LSD incumbents will have an unequal amount of incentives as opposed to newcomers for about six months - which is a long time in crypto. Until the incumbents’ incentives are brought down to the 0.1 fee / incentive level, this LSD incentive situation severely hinders competition. Perhaps this explains why Prism appears to be considering choosing Osmosis instead of Astroport as its main DEX.
If a marketplace favours incumbents over newcomers, it stifles innovation and growth.
If I may ask you your personal opinion, would you be in favour of taking measures to more quickly eliminate the discrepancy between incumbent LUNA LSD incentives and newcomer LUNA LSD incentives? I think it’s best to level the playing field sooner rather than later.
Just to clarify, Stride fully intends to launch an stLUNA-LUNA liquidity pool regardless of ASTRO incentives.