I’ve seen a lot of posts concerning the problems with price drops of PNG. The drop is caused because emission rates are high and because there is currently no unique financial use case for PNG. Staking has been proposed but with dividends in more PNG, which in my opinion is circular in structure and frankly, a little silly.
I propose to encourage staking of PNG by paying out dividends in USDT. In my opinion using USDT as dividends is better to stabilize the price because, if the USDT dividends are at a steady rate, it allows for the calculation of % dividend in USD and calculation of fair value of PNG. If the price of PNG drops, the dividends in USDT would become higher which would encourage buying of PNG and staking.
The USDT can come from using a small amount of the trading fees from all pairs. If I understand it correctly trading fees are at 0.3% of which 0.05% has been reserved for possible alternative usage.
I propose to start out with using 1/30th (0.01%) of all trading fees for PNG staking rewards and see how that goes. This small amount doesn’t impact trading fee rewards for LPs much and creates incentive for staking PNG and also incentive for PNG holders to increase swap volume. If it works correctly than increasing swap volume would directly increase staking dividends and PNG price.
I also would propose a dividend vesting period of, say, 7 days to discourage frequent changes in staking. In such a scheme, USDT can be withdrawn after 7 days of vesting. And PNG staking withdrawals would lose the USDT dividends from the previous 7 days. Those lost dividends could be added back to the overall dividend pool.
If the dividends do not encourage much staking than the % could be increased up to the max of 0.05% but it is probably best to start out small. If the overall platform swap volume increase even that small percentage should provide a very healthy dividend.