New Tokenomics emission implications

As part of our upcoming new Tokenomics, which we will be putting to vote soon, I thought it prudent to discuss the emission implications.

We need to set up the initial multipliers for the on chain proposal and as such we did a lot of work and research into what that looks like.

A few key points

  • Trader Joe highlighted how poor the initial tokenomics was designed and we need to ensure we remain competitive within this heightened competitive environment
  • Pangolin has a reputation as looking after the community. At what point does this negatively impact our ability to compete in terms of emissions?
  • I’ve come up with a draft classification system, that I’m proposing to use in the on chain governance
  • It’s a draft and only valid for the first two weeks on the new tokenomics
  • After the first two weeks of the new Tokenomics being live, we will look to implement a fortnightly revision of emissions
  • As part of the on chain proposal we will also propose to include 2 million PNG from the Community Treasury to boost APR’s

Initial Emissions

Please note you can find the current Emissions proposal here.

We have classified projects into 3 categories for the initial emissions
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A maxim from Jurgen Klopp I’m particularly fond of:

We have a bow and arrow, and if we aim exactly right, we can strike. It feels like Bayern have a bazooka, so the chances of them striking are much higher. But still, that was how Robin Hood succeeded.

This is why in the short term, strategically it makes sense to reward big projects in the ecosystem with high volume.

I think, personally, it’s contrarian to the ethos we’ve created at Pangolin. However, for Pangolin to survive and thrive, we must be competitive in the short term.

I thus, understand the practicalities and the pragmatist in me feels it’s the right decision.

However, I’m hoping this will inspire robust, strong debate from smaller projects. What can Pangolin do for your projects to ensure we have a diverse ecosystem, that fosters innovation and instils solidarity and not division. These are valuable aspirations and ones, we should embrace.

Here’s the initial proposed emissions:

If you strongly disagree, please let’s keep it respectful. Just because you disagree with something does not give you the right to act like a savage.

Defining future Emission schedules

Every two weeks we will revise the emission schedule and release communication with the proposed changes, we will then give the community and projects two days to voice their concerns or pleasure on the Forum.

In future emissions we will move to a simulated Mainnet AI driven platform.

We’ve talked to both Gauntlet and Chaos Labs and for future emissions strategies we’ll rely on a data driven approach. The parameters of that approach will be released as soon as we’ve formally engaged with our partner of choice.

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Thanks for putting this together @hariseldon2.

One thing that jumped out at me is the decision to treat two Daniele Sesta projects (Time and Spell are both his) as Essential AVAX Pairs and the removal of all of the major DeFi projects such as Sushi, AAVE and Uni. Is that down to transaction volumes?

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It’s a good point, it was mainly down to volumes associated with those projects.

It’s not an exact science though and that’s why we’ll revise fortnightly.

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I also don’t like having SPELL and TIME in top tiers. I can understand SPELL, but TIME (personal idea) is a ponzi/unsustainable project which will fail sooner or later. It’s more like an experiment. The ohm project from which it was forked tries to give some mathematical background but it’s all bullsh!t.
I’d have SPELL in the middle/low tier and TIME in the low tier (PS: I own both so it’s also against my interest), unless we can agree with abracadabra money to have a dedicated PNG pool for minting MIM in abracadabra.

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Also why not having a REAL decentralized stable:stable pair such as DAI.e:MIM? Or why not having MIM in any pair instead of TIME and SPELL?

Hmmmm, I must say, seeing Snowball as only a “nice to have” kinda hurts. I understand this is meant to be about volume, but Snowball has the same volume as Yield Yak with half the liquidity. So given we provide similar services, with similar volumes over the last 24hrs, but are positioned differently seems off.


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Yeah it’s definitely not the ideal way to define emissions. Once Chaos Labs comes on board, these decisions will have a much more mathematical and analytical approach

I also think this topic should be governed by the Tokenomics guild, but currently we don’t have anyone running that Guild yet.

Like the proposal and rationale.

Strategically, does it offer an opening for an additional solution?:

Pangolin selflessly paid a price for “community first”, in place of Ava Labs. While still keeping focus on the new tokenomics, could good move to propose a developmental/incubator program to Labs (expertise + $). You are already building a good business team (can advise teams beyond tokenmonics).

Can easily extend to be ido launch facility?

Fyi, MagnetDao is lunching a Ohm clone + incubator.

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This is a great comment.

It’s something we’ve talked about internally. Something like Pangolin Labs, which then provides advisory services to early stage projects and then in exchange those projects provide Pangolin a token allocation which then gets distributed via emissions.

I really like the model and think it makes a lot of sense. However as with all things, we have to understand where it lies in the priority list.

We have finite resources, so we have to make sure they’re optimally directed.

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Indeed, prioritization. Nonetheless the smaller projects in the ecosystem are going to need substantive liqidity support. Since PNG can not be expected to carry that load, would seem there will be leave a gap. Ava Labs would seem a fertile prospect (for a number of reasons) to partner here.

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I support this proposal. It is overall a better idea to strongly incentivize few pairs instead of weakly incentivizing a lot of pairs. It might be emotionally hard to remove many of the farms but this is much needed. Projects can still find their own unique ways to bootstrap liquidity, which is a good thing as it will take the burden off from Pangolin and increase innovation in the space.

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Hari, I like what you’ve done here. Numbers and the list of mutipliers can always change. I really like the team’s mathematical and data driven approach, let’s implement and maintain it asap. Btw, out of difficulties we’ve gone through altogether as Pangolin family, I think our team has gained much more experience than any of the Defi teams out there. Let’s utilize this expertise for community’s good. Good luck boys!

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Don’t want to enter a discussion around it, both are important as native projects but YAK doubles SNOB on almost all metrics (volume, tvl, liquidity). I would instead focus on understand why APEIN (40K volume) or WALBT (What’s this??) are in orange but I’m not seeing ORCA (340K) at all or SNOB being on the lower tier when both projects trusted and has been on Pangolin since the very beginning.

@hariseldon2 I think it is important to capitalize on the native projects, for example, a XAVA partnership to list their IDOs on Pangolin can justify a move up of their token.

I do believe the list needs a deep review in that front

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Nice to see you here mate :slight_smile:

I agree, the metrics are flawed and they’re in the hands of a few people. We had to make a call to get this over the line. We are engaging with Chaos Labs which will then align much more with what you’re talking about in making sure that PNG emissions are optimal.

I also think native projects are key. I think the most sustainable long term way for Avalanche to grow is for us to focus on native buidlers.

This list needs a massive review. I’ll be the first to admit that. We just didnt’ have time and enough metrics to make informed decisions.

Having Chaos Labs will allow us to move to a much more scientific, analytical approach that I believe aligns with what you are saying.

Always here just not always active, happy to read that changes will happen and happy to help where we can from Yield Yak!

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