Reallocate PNG Distribution

PNG LP providers are betting on the future of Pangolin, so it feels against the interest of Pangolin to say to them that they will have less PNG as a % of circulating supply then when they began simply because the valuation of PNG has gone down. I am for a system that allocates the same percentage to PNG LP’s as they have provided in liquidity. Example: If 50% of PNG is in the Liquidity pools, then 50% of the 175K per day will go to PNG pools. If 30% of PNG is in liquidity pools, then 30% of the daily distro will go to the PNG Pools. We can call these distributions coming from BUCKET 1. If you hold PNG, and do not provide liquidity then your % of PNG ownership will decrease.

The remaining PNG distribution goes to the the AVAX pools which are weighted by TVL. The distributions come from Bucket 2. The only pool that does not follow this exact logic is PNG/AVAX. This pool is compensated based upon number of PNG in the pool, and paid from Bucket 1. We then take TVL in this pool and divide by 2, and pay out based upon that number from Bucket 2.

Size of Buckets
Bucket 1 = (PNG in Pools/ Total PNG Issued so Far) * Daily Distro Rate
Bucket 2 = Daily Distro Rate - Bucket 1

Right now there is about 5.6 Million or 17% of all PNG in liquidity pools, so we PNG holders would get 17% of PNG on a daily basis every day. I would include the PNG in the treasury in this calculator of Total PNG Issued when calculating Bucket 2. Given that this is almost 50% of all PNG, this would give AVAX LP providers still a sizable chunk of PNG distributions, but limit the ability to decrease PNG rewards for PNG LP providers as the price of PNG goes down.

This system would effectively take percent ownership from PNG holders who are not providing liquidity and slowly reallocate it to AVAX LP’s who are contributing to the platform.

The below table is a simplified version assuming these are all the pools that exist.

2 Likes

I like most aspects of the concepts since it would incentivize holding/buying PNG and LPing in the respective PNG pools. Yet, we should avoid that non PNG pools get too small of a rewards share. I guess we would need to outbalance the concept a little. To date (about 50 % of all PNGs in treasury) PNG pools would yield 50 % of the daily distro if all PNGs are LPed, which seems quite a lot and should increase with increasing PNG supply. Awesome idea nonetheless and I am all for compensating PNG LPs - this has to be our number one aim.