Proposal: Implementing an adaptive YFI issuance which rebalances daily to keep the iearn pool the highest yield stablecoin pool by a small margin.
FOR: Implement adaptive issuance with the following rule: Every fixed number of blocks, consider all stablecoins pool with liquidity > 10 million dollars , compute the max APY from those pools and set the YFI distribution to be such that the yield of the iearn pool for the period (all yield included) is max APY from other pools+5% (at current snapshot YFI price).
AGAINST: Keep things as is
I think that we can all agree that the spirit of iearn is to push defi primitives to their natural boundary.
If we ask the question “what should be the optimal issuance target for liquidity mining at time t?”, there is IMO two natural answers:
-No issuance, which I was leaning towards at first but has the drawbacks that we know.
-Issuance that makes a pool slightly more profitable than all the other stablecoins pools.
This is why I propose that our issuance schedule stays targeted to keep the iearn pool slightly more profitable (say 5%) than the other stablecoin pools (with a threshold on the minimum depth for the pools we take into account) and is rebalanced accordingly at fixed intervals.
This provides a fantastic value proposition for the iearn pool which is very much in line with the original iearn products (optimal yields) and ensure that we keep both a low issuance and do not waste YFI in liquidity mining issuance.
The only drawback that I see is that other projects might see it as unfair competition and start being somehow hostile towards iearn.
Another interesting consequence of this adaptive issuance is that it creates some “AMPL like” economics where the higher the price the lower the issuance.