If you are only counted for a snapshot if staked in governance would holders want to stake to vote? Or stake for rewards (albeit lower than they could get elsewhere).
I wasn’t saying I agree with this, just that I think the way the system is now could be made better.
To me the point of the rewards lock is to encourage participation in governance through voting. But we should not encourage senseless voting just to claim rewards and we should not add friction that discourages staking in governance in the first place.
Although YFI locking after a vote has its place, preventing those staked in governance from removing their rewards other than during a window after voting does not seem necessary or entirely beneficial.
Agreed. The system could be better, and removing the reward restrictions is one way to do that.
I think the snapshot system will actually fix many of these issues. If people are worried about the vote-lock for staking and then unstaking, the snapshot fixes it since the snapshot is taken at one block.
Regarding voting of non-staked YFI, I’m hopeful that this won’t pass.
Otherwise, I think Snapshot voting still encourages locking in governance, as one can’t know when a new snapshot will take place, and so it is beneficial to keep one’s YFI staked at all times.
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I agree with this. Voting should be limited to YFI staked in governance.
If someone anticipating a snapahot block were to borrow a significant amount of YFI and retun the YFI just after the snapshot block, that person would have put very little skin in the game but could have a controlling vote. That itself seems suspect. It is even worse if that person intends to act maliciously and harm the protocol with rhat vote.
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I’ve found myself more and more drawn to this philosophy as well. Initially I wanted to be able to vote with YFI in the yYFI Vault, but I’ve come around. The idea of vote inflation or double-voting is worrisome - and I’m especially worried about voting from folks who borrow YFI off Aave and then use it to maliciously vote.
@banteg asked in my (first!) thread whether or not we could put the question to bed about YFI gov stakers being paid in YFI instead of yUSD after the creation of the yYFI vault - and I unfortunately disagree again. Change YFI staking rewards to increased YFI - #27 by banteg
I’m deeply conflicted by the two philosophies. I would like to have my YFI compounded as a reward for participating in governance, but I also don’t think that YFI that’s NOT in staking should be able to participate in governance. Perhaps the solution would be to create a second staking contract identical to the first, with the only difference being that you’re paid in YFI instead of yUSD that automatically compounds (without having to claim/restake)? Just a thought.
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This is a very, very good point.
Off the top of my head, with only a three-day vote-lock in current governance– I don’t think there is that much difference, unless the person does a VERY good job of guessing the block number.
Theoretically, exploiting snapshot could be mitigated by selected a block number 3-7 days prior to the current proposal– or am I missing something that could be exploited here? As long as someone didn’t say when they were going to be taking the snapshot, and it was at least a few days in the past, I think we’re actually better off than before with the 3-day staking.
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You know that I’m one of the other advocates for YFI stakers being paid in YFI–and I like the idea of two separate staking contracts that both get rewards, one in yUSD and one in YFI. Unless people have ideological issues with anyone being paid in YFI, I think it makes sense.
Maybe we can get this revived again sometime in the near future?
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I do not really want someone who sold all their YFI six days ago having a vote. I would prefer the three day lock remain in place for unstaking YFI after a vote.
The three day lock at least ensures that the voter has YFI at the time of the vote. To protect against attacks from borrowers of YFI, we could additionally have a system of increasing vote power over a period of time (say 60 days).
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Time-mediated vote weight is one of the key factors in aligning long term incentives, totally agree. We could also do time-mediated rewards. The longer you time-lock to Governance the higher your rewards multiplier. Many projects have already started doing this. It can turn into a bit of a prisoner’s dilemma but this may be ok.
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Yes, we could consider both increasing vote power over time and increasing rewards over time. They both should help align incentives to helping the protocol. We should keep in mind that we can do this with or without locking.
If I remember game theory, the outcome of the prisoners’ dilemma is not necessarily optimal, so maybe we should not put ourselves in that situation. Also, if I understand what you are thinking, we could alleviate the problem by keeping the time ramp period modest (maybe 60 or 100 days) and allow withdrawal at any time (with the understanding that the ramp up period will start fresh upon return).
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Completely agree. Some projects have done 5 year staking lock ups lol.
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I agree with this as well. I know some folks are talking about doing a Curve like multiplier that decays over time, but I think a better fit for the YFI ethos would be something that builds over time.
My thought is that YFI staked in governance starts at 0.5x vote weight (and rewards weight) and builds up to 2x weight in a year, at which point it stops building. This is mathematically identical to 1-4x weight btw, but the psychological aspect of half rewards feels more punishing. A good example of this is World of Warcraft’s Rest XP 
At first it was built as normal xp and half xp, but users HATED that… so they changed it to double vs normal and suddenly it was positively accepted. Would incentivize folks to stake for the long term and would create a barrier to withdrawal after reaching that cap.
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Really like this idea however prefer a shorter time scale, 1 year seems too long.
Something like 30-60 days to reach maximum stake weight (voting/rewards) may be sufficient for the purpose in question so long as the stake weight for each withdraw resets upon re-stake for that particular tokens unit.
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