what why is that? OH RIGHT BECAUSE IT WAS DISTRIBUTED FAIRLY… the point is you guys seem helldriven on slashing this great start for short-sighted greed by changing emission to a 99% frontloaded disaster (effectively a premine).
you’re literally just proving my point by highlighting how great the existing distribution is, so thank you.
I think that a requirement to provide liquidity to an 80/20 YFI/yCRV balancer pool would be interesting.
It would require farmers to buy YFI to farm and the LPs would be subject to impermanent loss which would mitigate some of the concerns about whales accumulating.
I believe before voting for what solution we want (what inflation, over which period…), we should vote for what problem we want to solve:
Who do we think is best to govern yearn? An early board made of savvy and opportunistic people? A wide range of participants built over the years? Wisdom of the crowd, or wisdom of a few savvy people? Those are questions with no perfect answer, just like “what is the best way to govern a country”: a true democracy of all people, a smaller group of people selected at random, a government made of elected people?
Is yield farming beneficial to the yearn ecosystem? Should earning YFI be a financial incentive for participants (higher inflation would be required for that), or should it just be about spreading governance rights at a regular pace (where slower inflation that slowly involves long-time ecosystem participants more and more becomes a solution)? Is spreading governance further needed for the ecosystem to work (pre-YFI success of yearn would suggest not)? Is it desired nonetheless because it’d build a larger set of stakeholders long-term, with continued renewed interest? One must keep in mind that zero inflation doesn’t mean the set of stakeholders won’t change, since YFI is liquid.
We can aim for the best compromise, and the best technical parameters, once we know how the majority of us sees yearn governance!
With yEarn v2, all of the yield farmers will use yEarn to farm mta/bal/comp or whatever come up next. So the meme argument may not be valid here.
I am not for inflation. I agree; 50k max. AND BURN THE KEYS. IMO inflation is simply another attack vector for the power hungry. It’s an easy way out because it requires far less work and effort to be/remain successful.
There will be plenary enough opportunity to farm via well communicated products yEarn releases.
I’d much rather be discussing how to communicate all that is yEarn than constant fighting over a token count. Real success imo will come from a well crafted and clearly conveyed message that excite people to participate in the use of yEarn products.
assuming of course no clone of yEarn v2 is deployed doing the exact same but without the YFI fee?
but who would clone an open source smart contract?!
YFI voters need to think long and hard about the value they can bring too.
Should I deposit my $$ on the original contract by Andre and the governance behind $YFI or some clone out there so that I can save 5bps? Tough choice, indeed.
Is the YFII fork what is being created with Justin Sun? Is YFII a scam?
UPD: Post was moderated to remove a link.
does yEarn algo favour AAVE over COMP because of who deployed it or the COMP governance? nope, so theres your answer to which would be adopted in future if such a thing existed.
@cryptokid2020 that is a phishing website. I just verified. Here is the address https://etherscan.io/address/0xb81d3cb2708530ea990a287142b82d058725c092 cc @milkyklim
@Garry Agree with you 100% if I have the time to read and audit every single line of code in the cloned contract.
Thank you! I thought it seemed too good to be true
Regarding inflation, the total number of coins distributed over a set period of time does not affect the scarcity of an asset. In this regard, When viewed from outside the system there is no difference between 50K YFI distributed over 5 years and 300K or 1Million YFI distributed over the same time period. The only thing that changes is the distribution of who has the tokens within the system.
In this sense high inflation of a supply capped asset is equivalent to low inflation of a supply capped asset if one assumes the marketcaps will equal out eventually.
As another example, if Bitcoin had a 21 billion supply cap and were distributed along the same curve, it would make no different to the overall value (marketcap) of Bitcoin, although individual bitcoins would be worth 1000x less
For anyone who farmed YFI and plans on continuing to farm YFI, the difference between high issuance and low issuance (in relation to the amount that has already been minted) should be considered in regards the the following scenarios:
Low issuance but low usage of yEarn products and only current holders farm it means current holders are not diluted but don’t benefit from a growing system.
High issuance but low usage of yEarn products and only current holders farm it means current holders are not diluted but don’t benefit from a growing system.
Low issuance and high usage overwhelmingly benefits current holders but risks turning public opinion against the project and therefore hurting current holders.
High issuance and high usage dilutes current holders but benefits everyone because the system is growing.
In my mind, a capped supply schedule (or one with a very low tail inflation) with higher issuance relative to what has already been issued, is a safer long term path for the project and has minimal negative effects on stakeholders who are interested in continuing to use and yield farm with yEarn.
What the critics of the low inflation models do not take into account is that if all goes according to plan the value of one YFI will appreciate considerably (maybe 10x maybe 100x maybe more) in the future.
This is very important!
With that in mind I find even 50K to be excessive because the additional 20K given away in the future will be worth orders of magnitude more than the 30K given out in the first week and therefore does not compensate enough the people who “tested in prod” by risking their capital in comparison to those who come later into a well used, popular, tested platform with a useful service on top.
I don’t see how the issuance rate (assuming it is capped or very low in perpetuity) makes any difference to this. YFI will be valued based on the underlying value that the token derives, not an arbitrary number of how many there are.
By this same logic, you are saying that the returns that one group of people received while risking their funds for 1 week should be valued significantly more than people who come later. People who come later and have to put money into the system and expose themselves to contract risk for much longer to earn the same amount do not deserve the same rewards for their risk. This also assumes that if rewards start up again soon, that the risk will be significantly less, which I don’t think is realistic.
Sure maybe in 5-10 years the risk will be much less, but by then its probably fine if the rewards are super low. We are talking about next month to next year, and the risks will be minimally different from right now.
This.
YFI is liquid. Now that YIP 10 has passed and YIP 12 looks likely to pass, people can directly influence the direction of the protocol by purchasing YFI on the open market. But I agree that a 50K-100K decaying issuance model is a good non-dilutive compromise to sustain rewards for LPs and protocol development.
This is overwhelmingly not true. I don’t see people shying away from Amazon stock because Bezos won’t do a stock split to lower the cost of entry on a per share basis.
I don’t see how the issuance rate (assuming it is capped or very low in perpetuity) makes any difference to this. YFI will be valued based on the underlying value that the token derives, not an arbitrary number of how many there are.
@rgalloway By increasing inflation and supply, do you believe that will have no impact on the price of YFI? I may agree that total MC may end up being the same, but I would argue that increased supply/inflation would in fact decrease the value of YFI (or at least put significant selling pressure on YFI that could only be mitigated by new demand).
On a separate note, I think creating demand for the product (YFI yield farming product) is by far the most important initiative. If Andre is able to create a competitive product, the users will come which will increase TVL which will drive value to YFI. If there is enough revenue from those fees (and fees from other yearn products), I argue that there will be enough incentive for people to buy and stake YFI.
Andre has already shown that he can be innovative. With each product that gets created, YFI will have another revenue stream. And if those products are good, people will use them regardless of what they think of YFI.
Do we need to further incentivize people to farm? I tend to believe that we don’t but I won’t be stubborn about it. What if we choose to be more flexible? We can periodically (ie, monthly or every 6 months) vote on the inflation rate. Use the inflation rate to inflate or deflate interest in YFI not unlike how the Fed uses the fed funds rate to inflate or deflate the economy. If fee revenue is strong and APR is enticing enough, then we won’t need inflation (other than business and developer expenses). In the end, it is about attracting YFI hodlers not farmers.
Sorry for being so long winded!
Amazon started as a private company. It had funding rounds. It had an IPO. I’m not saying those things are good and we should do them, but we aren’t talking about stock splits, we are talking about an equivalent of the initial distribution of the stock of a company. I’m making the argument that it would have made no difference to the value of Amazon the company if set their initial share price at 1 dollar and sold a billion shares or at a million dollars and sold 1000.
I want to be clear I am talking about total supply issued.
If yEarn releases 30k shares in a week and then another 20k over the next few years, it would be the equivalent to a company going public after a week, giving almost no time for anyone but a few connected individuals time to do any sort of due diligence and invest in the sale, and then offer a smaller raise and many multiples higher right after.
This is exactly the well connected VC model that so many people have railed against and a bright spot of the project so far. I am trying to caution against this because I think it will reflect poorly on the project in the long term.
Is it possible to separate inflation for yield farming and inflation for business and development expenses? This entire inflation discussion is delaying the funds needed to business and development expenses in particular security audits and etc.
I think we might be able to move forward by separating the issues.
Hi all,
So I’m a newcomer to the whole deFi space (just started learning it 2 days ago), and everything I’m about to say is complete conjecture, and I hold absolutely no YFI at this time. That being said, I just ask that you all consider this in your decision regarding inflation and emissions.
As a complete beginner I am unsure of all the risks so I held off becoming an immediate LP for the curve, YFI, and Balancer platforms, as I wanted to learn the risks in advance before just jumping right in. So I dedicated the past 30 or so hours to learning these risks and the YFI protocols for yield farming. By the time I became comfortably informed of the risks/rewards the YFI rewards ended, I was aware this could happen as I learned of this forum about 10-15 hours into my research. However, with these low inflationary proposals and the majority of governance already among a select few of early adopters (and early is an understatement here especially when it comes to a new financial system), I am definitely having second thoughts of even becoming a part of this community. Here are my thoughts:
This is a brand new protocol. It has been in public operation for a week and was tested in its production. I could be wrong, but I highly doubt the risks have been all ironed out. I learned about this protocol through yield farmers. The thing that drew some of these yield farmers to the protocol were the returns in YFI (300-1000%), while the other yields were considered more of a bonus (I am not solely advocating that similar yields be continued, I’m simply stating an observation). Although not all early adopters are strictly yield farmers and actually want more to do with its governance than to just farm, they are still farming yields which acted as a further incentive to continue providing liquidity. So, the risks are still just as high as before (I’m assuming this because a week is just enough time to scratch the surface of possible vulnerabilities fixes) and the incentives have all but disappeared and other pools look just as (if not more) lucrative.
The public majority that did vote is in favor of a 50k model. This favors the first week adopters unfathomably. It appears that the active voting community is less than 200. I’m not sure how many voters there actually are and so I don’t know how many are needed to reach quorum (as i said I’m just learning about deFi, and don’t know if there is a way of even discovering this info). This concerns me because if there is currently less than 200 who hold the majority (>50%) and over 50% of total supply has already been minted, regardless of the magnitude of adopters yet to come, be it 10k or 10m, they will never hold enough YFI to contest the early adopters (especially since the early adopters will also be sharing in the yields from future pools), and this holds true even if future adopters all agreed (which is almost an impossibility in itself) on a proposal that the early adopters didn’t or vice versa.
I have other thoughts but I have things that need doing so I will end with a little analogy.
Club X just opened a week ago. This club allows you to partake in its governance. When you get to the club there are 200 active members of the club. To earn the right to vote on club activities you are told you must first engage in these activities. So over the next month you completely throw yourself into the club’s activities and attend your first club meeting. A decision comes up for a vote, you and a thousand others that joined around the time you did vote for the proposal and 10 people who were already part of the club before you joined vote against it. You and the 999 others lose the vote and you find out its because your vote (and the others that voted with you) are only worth a fraction of the 10 who were in the club before you. (I apologize in advance as the following is not meant to be taken personally, nor is it an attack on anyone)… Fuck this club…