Discussion: rKP3R allocation to Curve Gauges

Projects Fixed Forex
1

Purpose;
Thread for ideas & discussion on how best to utilize weekly allocations of rKP3R rewards for Curve gauges.

Background;
There are currently 1k per weekly allocation of rKP3R to Curve gauges, although allocation is subject to change at the discretion of the multisig.

This allocation is currently assigned by vKP3R holders who place votes at Fixed Forex, with each vKP3R allocated a proportional share of voting power based on total vKP3R (i.e. total balance of vKP3R of ALL vested token holders)

vKP3R holders are able to vote for any of the following curve pools;

  • KP3R+wETH
  • ibEUR+sEUR
  • ibEUR+agEUR
  • ibEUR+USDC
  • ibAUD+aAUD
  • ibAUD+USDC
  • ibCHF+sCHF
  • ibCHF+USDC
  • ibGBP+sGBP
  • ibGBP+USDC
  • ibJPY+sJPY
  • ibJPY+USDC
  • ibKRW+sKRW
  • ibKRW+USDC

Votes placed will determine weekly allocations of rKP3R rewards to curve pools. Votes are on-chain, meaning users must spend gas to place votes.

Problem with vKP3R holders solely directing rKP3R allocation;
It doesn’t make logical sense for vKP3R holders to be the sole & only agents determining rKP3R allocation to pools as incentives are not naturally aligned due to;

  1. Not every vKP3R is also holding a LP position in curve pools or liquidity mining rewards - meaning there is no self-interest incentivization for these vKP3Rs
  2. Such vKP3R are completely disincentivized to vote for allocation due to incurring costs of gas fees where there is no incentive to do so

Therefore the current system only incentivizes vKP3R holders who are also holding LP positions.

This also means there is a huge missed opportunity for the protocol to utilize rKP3R allocations to dynamically incentivize pools where there are off-peg scenarios. It would be especially useful since current rewards for Curve pools are determined and fixed through the bi-weekly vlCVX gauge voting process.This would also benefit vKP3Rs as users entering pools where off-peg would earn rKP3R and redeem, creating additional OLM revenues which are directed back to vKP3Rs via fee payment.

Options;
The following options should be open for debate & consideration, alongside any other suggestions or recommendations highlighted by the community;

  • Option 1 - Do nothing / No change
  • Option 2 - Maintain current system/mechanism but allow delegation of any unutilized votes to the Keep3r treasury to be used for the purposes of dynamically allocating to the most well suited Curve pools
  • Option 3 - Maintain vKP3Rs as the sole determining agent of rKP3R allocation but switch to a non-gas incurring voting mechanism (such as snapshot, etc.)
  • Option 4 - Remove vKP3R holders voting rights entirely, and have rKP3R distribution to gauges exclusively used to target incentivizing pools dynamically through direct management of the treasury and/or an automated keep3r Job

Please use the comments section below to add any further suggestions or ideas below.

5 Likes
2

I prefer a combination of Option 2 and 3. I’d like the option to delegate, vote, and switch to a non-gas voting mechanism. I’ve never voted because even today at 40ish gwei that transaction estimate is $42.

4 Likes