**[Proposal]** Developer Incentives

I won’t lie, I am losing confidence in the project seeing these debates keep coming up.

Likewise. It is really fatiguing to sit here, with serious value staked in yfi, when there is a constant drumbeat of devs whining and threatening to leave and shills like Blue Kirby calling for yfi to start the money printers even though we specifically voted to burn the keys just a few months ago. Why hold votes? Why hold a governance coin? The APY for locked yfi is a pathetic 1.3448% and the devs do whatever the eff they want anyway.

Let me be more blunt. I am really sick of Andre’s constant fudding and expressions of self-loathing. But I am more sick of him shit talking OG token holders, even though we were there with him in the very beginning, risking capital by farming yfi when that was a super risky proposition. Then, many of us stayed with the project out of faith in the dev team and Andre even though the return on the governance token is only 1.3448% annually. I mean ok, that is better than a checking account pays, but now they are asking us to debase the underlying asset by printing 3% more or 10% more, or by tomorrow, who knows, it may be 20% more.

I’ve had it. Please just give me something to vote on so I can unlock my yfi from governance and get the hell out of here.

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My sentiment exactly. Andre himself put up the vote to burnt the mint keys. The fact this has not been executed on and then proposals to fork the token and go against that undermines any validity of even having a vote. At what point is this a dev capture and at what point is it community governance? Given these forums are completely open, sock puppets could easily hammer these narratives until the OG holders walk and more naive folks are taken advantage of. I dislike the direction this is all going immensely.

P.S. IF I can reiterate → If the YFI project cannot afford to pay its devs from its output, this means the protocol is non viable. It has established network effect and mindshare already. YFI is a ‘blue chip’ as we call it. If we still cannot generate revenue to pay it’s staff, why not? This is the actual problem that needs attention, not lump sum ICO style founder rewards. We know where that all ends up.

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Straight up - what do the devs want? They’re obviously unhappy with their token ownership, this is painfully clear. There are proposals popping up all the time around incentives. Everyone agrees that the devs should be paid and have meaningful ownership. These discussions seem to be all over the map however and there are a lot of wasted threads (there is one on the front-page right now called “make andre happy”). Buy and make was just discussed last week and now there is another proposal.

Instead of always having these discussions pop up I am curious what the devs believe is fair and would like as a permanent solution. A mint would give them a larger stake in yfi now and then the protocol could implement buy and make or buy and burn moving forward. Buy and burn would directly impact holders today whereas buy and make gives more flexibility and builds a treasury for future endeavours.

The mint amount is negligible and won’t have an impact on price. The “fair launch” was a mistake and has been hanging over this protocol for months. I think everyone would like to move on with a final structure so we don’t need to have these discussions anymore. I would like to hear what the devs want - the 1,000 mint proposed is an arbitrary number.

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Listen my friends:

  1. 30k Meme ist epic strong. Dont kill it.
  2. If we use the printer one time we will do it many more times in the future. Zero to one! Dont do it. It is like always in life. Be smart dont start.

But:
Why cant we compensate the devs with 10 Mio $ in the next years and thats it. They get rich and yfi keeps its 30k meme.

Conclusion:
Pay the devs, yes.
Print more yfi, no.

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Strongly against, for the reasons many others have already stated. Both of the other proposals (buyback/burn and the 10-20 YFI) are far better for the long-term brand value of YFI and I would gladly support either of them. The damages done to the YFI brand because of a breach in trust far outweigh any concerns over dilution itself. Once the minting precedent is broken, it is gone - FOREVER. As a community, we can do better.

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If this faces too much opposition, what about minting 2000?

32 ETH to stake, 32k YFI could be a meme.

1000 for devs, 1000 distributed to YFI holders.

Could encourage hodlers to donate some of their airdrop to devs, github grants, or charity to pay it forward.

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Like mining, it should be rewarded with a higher percentage in fees

I like it thats why i voted yes.

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As a defi developer myself, I think not passing this proposal would be extremely short-sighted by the community. Competency in this space equates to millions of dollars in opportunity, and it’s already respectable that Andre + team hasn’t simply moved onto another project with a different token distribution so that they can actually get a fair share of the economic surplus they’re creating. Complaining about your X% APY or bags won’t matter if you disillusion the devs of the protocol – they’ll simply become jaded and/or leave.

If you had a golden goose, would you complain about feeding it expensive food?

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We can replace you with whales who understand how building a successful product/protocol/organization works.

Farming YFI early was an amazing call, and you deserve a lot of credit for that, but you’re replaceable. Andre isn’t.

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Long-term fundamentals are much more important than short-term meme pumps.

I wholeheartedly agree with everything you wrote, but I think the devs want us to decide for them. That’s the culture they’ve built thus far, although I wouldn’t mind a change for a moment to make sure we do right by them.

A lot of startups can’t pay their employees enough with investor warchests (aka equity issuance).

A lot of public companies aren’t even profitable.

What are you talking about?

I vote the strongest AGAINST.

Printing more YFI would forever destroy the project credibility, much like raising BTC max supply above 21M would destroy BTC.

Doing this, even juste once, is the death of yearn.finance singularity.

Especially since minting additional YFI has already been discussed and voted against (why the hell weren’t mint keys already destroyed?).

Backpedalling, hell, even discussing on a community votes sets a dangerous precedent and is a worrisome signal. Vote results should be considered sacred, otherwise the community gov, which is a core proposition of yearn.finance, loses all meaning and relevance.

To better reward devs, other approaches can and should be favored instead of this very destructive one.

The other ones are far better and not destructive.

Another idea: why not divert the first 1000 YFI used to mint WYFI to build a dev fund, instead of destroying them? and then once 1000 YFI have been collected, go on with the burning mechanism?

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You label this a PS, but shouldn’t this be the principle question? The protocol is generating effectively zero income, yet the devs feel unappreciated and want to be rewarded. Meanwhile it has become quite clear that the devs have no intention of acting on the proposals that governance votes on. Wasn’t it in August that we voted to create a vault for SNX? And more recently we voted to burn the mint keys, but now we learn that the keys weren’t burned and by the way, the devs now want us to mint yfi for them. You ask at what point this becomes a “dev capture” but isn’t it now clear that a dev capture is precisely what we are witnessing?

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You can claim fees and unlock your tokens from governance via the contract on Etherscan. Link: Contract Address 0xba37b002abafdd8e89a1995da52740bbc013d992 | Etherscan

Nothing is trapping anyone in the governance contract, you can withdraw at any time.

Why is this destructive?

Please read other comments on incentive alignment and Ethereum approach versus Bitcoin approach.

As a YFI holder, I’m asking myself:

  • Why should the contributors continue working on the project vs a competing opportunity (eg. launching a competing protocol with fair ownership stakes)?
  • What value does YFI have without its current contributors?

On a more fundamental level, I think tokens must provide real value to their protocols to be sustainable. Eg MKR or AAVE holders earn their governance rights by providing insurance to the underlying protocols. UNI, BAL, etc arguably provide value to their respective ecosystems through inflation subsidies and grants.

YFI currently provides 0 value to the Yearn ecosystem, but expects to control protocol development and revenues. This is obviously not sustainable.

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Dev capture? We have the best builders in the space. It’s a shame that there are people on our cap table who think like this. 0 sum, not positive sum. 0 work, but maximal criticism. We need positive sum, forward thinking investors to build the world’s bank. Those stuck in the past are best to leave now.

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For all the reasons many people, including me explained above, in rather clear terms. Your proposition wants to ignore / overrule a previous community decision and rewrite one of the strongest core principles of yearn, for something that can be done in other ways.

Killing two birds with one stone : respect and trust in the community governance, and the YFI hard scarcity meme that makes it unique.

The simple fact this is being debated is really worrisome.

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