ARC-86: Adjust ASTRO Rewards on Terra

Proposals ARC (Astroport Request for Comments)
1

Summary

This proposal aims to adjust the ASTRO rewards distributed each block on Terra from 13.1334 ASTRO to 3.28335 ASTRO.

Abstract

Recently, ARC-81, which advocates for adjusting the default fee to emission ratio used for ASTRO rewards, passed on-chain voting. As a result of that proposal and the fact that PCL pools are like on Terra, we propose that the per block ASTRO emissions on Terra change from 13.1334 ASTRO to 3.28335 ASTRO. This is a 75% change which is in line with the proposed figures in ARC-81.

Executable Message

The executable message for this proposal looks as follows:

[
  {
    "wasm": {
      "execute": {
        "contract_addr": "terra1ksvlfex49desf4c452j6dewdjs6c48nafemetuwjyj6yexd7x3wqvwa7j9",
        "msg": "ewogICAgICAgICAgInNldF90b2tlbnNfcGVyX2Jsb2NrIjogewogICAgICAgICAgICAiYW1vdW50IjogIjMyODMzNTAiCiAgICAgICAgICB9CiAgICAgICAgfQo=",
        "funds": []
      }
    }
  }
]

The readable version of this proposal looks as follows:

[
  {
    "wasm": {
      "execute": {
        "contract_addr": "terra1ksvlfex49desf4c452j6dewdjs6c48nafemetuwjyj6yexd7x3wqvwa7j9",
        "msg": {
          "set_tokens_per_block": {
            "amount": "3283350"
          }
        },
        "funds": []
      }
    }
  }
]

Copyright

Copyright and related rights waived via CC0.

3 Likes
2

If we are trying to get each pool closer to the 1:10 revenue:rewards ratio while still trying to reduce overall emissions on terra, it would make more sense to remove a substantial amount of the emissions from the Astro usdc pool as that one is currently most unbalanced (if I remember correctly), rather than a blanket cut. I’m most worried about removing 75% of the emissions from the luna usdc pool as this is the anchor pool for luna.

3

Hey Astroport Chads,

I think that the quick trigger of ARC-86 to move on chain is not following any proper governance procedure and argumentation lacking due to Terra NOT being an outpost as of today. The community has not voted on moving Astroport to Neutron yet, so it is still the main hub.

ARC-81: “This proposal recommends that incentives be reduced for outposts on which PCL has been deployed by 75%”

This means that the 75% reduction in emissions should not be considered today.

PCL pools also have not been launched (for more pools), incentivized, or proven themselves. The delay of the PCL pools due to security bugs doesn’t make this any better.

I am even considering this proposal as malicious, as due to the short 1 day timeframe, ASTRO-USDC liquidity providers were not able to deposit to participate in voting on this major change proposal. This is still where the majority of ASTRO liquidity is located.

So I will be voting NO: Astroport

1 Like
4

As Phillip mentioned above, this proposal went on chain faster than the 5+2 day minimum… is there a reason for an expedited vote?

Also, PCL pools may be “live” however no pools can be converted to PCL yet except for the first LUNA-ASTRO one (at least from the UI). I don’t think I would consider it fully launched until other pools can also benefit from the new pool type. It doesn’t make any sense to me to push this vote through before that happens.

On the phrasing of ‘outposts’, I would consider every Astroport deployment as an outpost regardless of whether it houses governance or not.

1 Like
6

ARC-81 says

If this proposal passes the change would apply immediately to Terra mainnet as the first and currently only outpost to have PCL. Once the Astral Assembly votes to deploy PCL on other outposts, the reduction would be applied there too.

When that proposal went onchain it should have reduced Terra emissions at that point. IMO it was just a mistake that this was missing from the onchain message.

Given ARC-81 passed so strongly I’m going to vote yes on this (and on future proposals to reduce on the other chains when PCL is shortly deployed to them). Given the signalling proposal these chain-specific proposals should just be a formality.

7

In addition to what Luke posted above, I wanted to clarify a couple points:

  • Terra is also an Astroport “outpost” and ARC-81 mentioned that it’s the first one where the emission reduction should take effect
  • ARC-81 mentions that Once the Astral Assembly votes to deploy PCL on other outposts, the reduction would be applied there too.. This means that once PCL lands on an outpost as a new pool type, then the ASTRO emissions on that outpost should be adjusted
1 Like
8

I think @lukedelphi and @stefan , already covered a lot of the points that I would express.

Some of the criticism is fair, but I do feel like we are in a place where we do need emission reductions due to the current market conditions, it really is conditioning Astroport’s development and stability.

Also I would like to add that although the proposals were tied to PCL (maybe this was a mistake on how the proposals were written), the emissions reduction isn’t 100% tied with PCL, it just adds more points in favor of it.

I will be voting YES.

1 Like
9

PCL pools can be created on chain, no one is limiting that (soon to be added to the UI).

And whoever wants to migrate pools to PCL can do so as well, posting a governance Proposal to deregister and creating the new pool with PCL as it’s type (which will always be how it needs to be done).

1 Like
10

I’m sorry, and I think the community’s frustration is understandable here.

Words matter and ARC-81’s words seem not to fully signal that this onchain proposal would ensue from ARC-81 just based on the fact that a single PCL pool exists on Terra. It seems it was a mistake for the wording and reasoning of ARC-81 to tie the ASTRO rewards reduction so closely to PCL, when really the primary impetus is just to reduce emissions because they are not delivering enough bang for the buck and Astroport needs to conserve its incentives for a smarter multi-chain strategy. ARC-81 was confusing in that regard and while each Astroport contributor is an individual rather than speaking on behalf of a ‘team’ etc., personally I’m sorry for not catching the issue and speaking up.

All that being said, based on discussions with other large ASTRO holders, I am not sure that further discussion for another week+ would really change anyone’s views about the need for emissions reduction across-the-board or create appetite of a voting majority to take a surgical approach re: how to reduce emissions over different pools. So I think the proposal should move forward anyway, as it seems very likely the ultimate result is going to be the same, just delayed for a week while people debate with no change in outcome.

As a side note–this is why we need vxASTRO. Deciding emissions through cumbersome social debates etc. is just not efficient, clear and sensible. We can’t take the surgical approach suggested by some in this thread because it would be too cumbersome to debate about each individual pool. To be able to decide different emissions for different pools efficiently, we need to get rid of cumbersome quasi-social-contract governance and move this to a full voting market model through vxASTRO.

4 Likes
11

I appreciate the clarification from yourself and others. I think some of us were more focused on the phrasing of the other proposal/messaging and an order in which things would play out (which lex_node expanded on as well).

12

I’d be surprised if we see the liquidity in that pool drop significantly. Spaydh’s recent proposal on Neutron looks into this and suggests that some will leave, but overall pools will stay healthy.

Can’t say it won’t or can’t happen, just that I’d be surprised if it does

13

Liquidity has dropped ~ 50% since the reduction of Astro rewards. From 2.5M to 1.2M. I don’t know what constitutes “unhealthy” but just wanted to let you know so we can observe the case study. @donovan

14

Token price is a massive factor in influencing liquidity flight; if the token price was steady or rising then it could offset the losses incurred by liquidity providers due to reduced emissions. Unfortunately Delphi are doing nothing to instill confidence in ASTRO, or to provide any form of positive outlook for future features/upgrades that will drive value for ASTRO.

So expect liquidity to keep dropping in correlation with token price.

15

What about the significant drop in ASTRO incentives due to PCL pool types and the ASTRO Wars. If this does not get you excited about the future of ASTRO, not sure what will get you excited. Not to even mention the strategic alliance with Neutron and other positive news that we recently got.

1 Like