This proposal intends to increase revenue for the yYFI vault by rewarding those who stay in the vault for longer time periods while disincentivizing those who do not.
This proposal in theory should increase market buying pressure for YFI, and further incentivize users to keep their YFI within the ecosystem.
Currently the yYFI vault farms and sells tokens to purchase more YFI. The yYFI vault is important because it directly drives demand for YFI on the open market
Increase the withdrawal fee for the yYFI vault specifically. This disincentivizes those who don’t stay in the vault long enough while simultaneously rewarding those who do. The fee structure could be time-weighted; meaning as someone holds their YFI in the vault, the fee is reduced as time progresses. If you withdraw after x time (let’s say 60 days), then the fee is waived.
The additional revenue derived from the fee should go directly back into the yYFI vault. This acts like a buyback.
If everyone were to exit at the same time, such as during a market panic or liquidity crisis, the yYFI vault’s revenue would dramatically increase thus causing the buying pressure for YFI to increase in response.
The increased exit fee works counter cyclically with natural market downtrends. It will help counteract downside volatility, which in turn will assist in stabilizing governance. Get people in, keep people in.
Implement an additional fee specific to the yYFI vault to increase YFI demand pressure & dampen downside volatility.
For: Increase the withdraw fee for the yYFI vault
Against: Leave the vault as is