More Agility in Decision Making for new Products (Vaults, Farming, Insurance, etc) aligned with a Strategy focused on increasing Value for Depositors and for YFI holder
More Streamlined Communication of Yearn with the DeFi User community (Brand, Initiatives, Products)
Better incentives for attracting top development talent (Pay in YFI, partially timelocked)
The expected outcome is to add more quickly products that the DeFi Community wants (e.g. Non Stable Coin Farming (e.g. Uni Pools, Hegic) to Increase TVL, Ecosystem Growth (and stickiness if possible) and Fees for the Yearn Community
Abstract:
Yearn is a great project but we feel there needs to be a change of direction. Community governance is less effective than it could be by the way itās currently set up and it is too slow for the pace at which this space evolves.
It it is great that everybody has a voice and can propose strategies and ideas and everybody could build but in the end it is not very effective. Teams can move faster if there is more guidance and a centralized voice leading that effort. There seems to be a lot of hesitancy to go that route because of the origins of how Yearn started and grew and the decentralized space we are in.
This tweet by @banteg highlights the Dev Talent Attraction problem; the sudden explosion in TVL at https://harvest.finance/ (~800M TVL, > than YFI) indicates that we are missing the boat on new simple strategies that DeFi users want to join.
Motivation:
The initial success attracted top talent and weāre grateful to have them here but the key question it how do we keep and attract more talent. That is a very key question and we need to align governance and incentives to work on that. Many yearns āwanna beā (YFx) or evolutions (e.g. Pickle, Harvest) were created just because of this initial success so itās impossible to keep up if we donāt change. This is an extremely dynamic space and we need to move faster to keep attracting top talent and grow the total value locked in the Yearn ecosystem.
We suggest a different approach which takes elements from the traditional approach of companies, while retaining full Community control
Specification:
We propose:
Head of Strategies. Main focus is to propose direction, collect proposals from Community, propose to the Community. Align proposals and advice Community with Capacity to execute.
Align Value to depositors into yearn (Users) with value to YFI holders. Pay a portion current in yUSD, a portion time locked in YFI.
Developers incentives: Need to keep and attract new talent. This is an extremely competitive space and any good developer can find or define a project to work on. We want the best to stay and join YFI. Head of Strategy should align with Head of Ops on best incentives. Pay a portion current in yUSD, a portion time locked in YFI.
Marketing Coordinador: Blue Kirby turned out to be ātoo interestingā, but initially generated a lot of good vibe. Main function to guide discussions/awareness campaigns/ brand recognition. Could be incentivizing participants for work based on Prizes, etc, but with clearer, uniform guidance. Should define campaigns/communication approach, etc and submit for votes. May pay in YFI.
Compensation to be proposed by Multi Sig holders for vote: Propose alternative on how to best compensate these positions to create an upward trajectory again.
For: Implement these changes. Community members should propose suitable candidates for these positions and have a vote.
Great post overall, thanks for starting this discussion. I am just one very small voice here but I agree with the sentiment that we need to compete with protocols like pickle and harvest. However, I disagree that we need to make anyone āthe headā of something.
Secondly, I agree that some of the treasury funds should be used to acquire YFI which should be given to new devs with a vesting schedule.
Lastly, I disagree that we need any more marketing people- the community is actually doing a great job of keeping people updated.
Thank you Matterhorn for your answer and support. We all have individually small voices, but thatās the beauty of this, everybody can join the discussion and help build greater good !
āHeadā is just semanticsā¦ It should be someone who owns the problem and leads the proposal collection, aligns peoples ideas with dev work funnel, lay down a clear roadmap etc etc. There are plenty ideas, proposals written and even coded in the last couple of months (@mattdw only wrote 4 or 5 iicr) which imo should have much more feedback from the core development side.
YFIās community is large and great and communication well done right now. But YFI has something which is pretty unique, a great Brand. This is some unusual high value asset and should be taken care of and nurtured as well.
High yields, diverse portfolio and a strong brand are the most important things to attract more TVL and Value to YFI.
Glad to get the link and the shoutout! I also wanted to make sure @macarse gets a shout as well, as Iāve been working with him very closely on strategies during the ETH Online Hackathon. Heās been instrumental in building the HEGIC vault strategy.
I think there are a lot of good ideas/questions here, and I understand where some of them are coming from and think I may have answers to some of them.
Regarding UNI LP farming, @banteg has previously mentioned that for simple strategies such as these, Yearn is at an inherent disadvantage to farms such as Pickle or Harvest. These can both subsidize with governance token emissions, and Yearn cannot. Therefore, the only reason a user would stash their LP tokens with Yearn over these others is our brand and/or the level of trust they feel using Yearn vs others.
However, I do agree that if we can, it would be great to have users stake their UNI LP tokens or their wBTC with us (because fees for YFI holders), even if we canāt guarantee any better yields than Harvest on some assets. I think the best way to encourage users to stash these assets with us is to offer truly novel strategies, vaults, and productsāwhich I believe is what we have been focusing on (v2 Vaults), but also why it may seem like from the outside not much has been happening.
Regarding branding and communications, there is a good amount of work being done behind the scenes by @FutureFund, @tracheopteryx, and others on an upcoming v2 redesign of the site that will align with new branding. I donāt much more info on that, but maybe someone else could chime in on the status of it.
In terms of vested YFI payouts for contributors, I think this is a great ideaāI posted basically the same idea on Bantegās post on twitter about this. This is certainly one place where Harvest has a leg up with their tokenomics modelāthey can incentivize work on their protocol with FARM emissions, whereas all of the YFI has already been distributed. Buying back and distributing vested YFI to protocol contributors (not just devs) as a part of their compensation could help ensure that those who are helping to build the protocol/brand will be rewarded for its long-term success, and ultimately may help support sustainable contributors instead of just those who are trying to do enough short-term to get a yUSD payout. Although YFI started out as just āvotesā, it is now much more than that, and I think having skin in the game is always a good thing.
And regarding marketing, I think for now we are trying to put our head downs and build, and keep the community updated on what everyone is doing in an informative and factual way. As you said, Kirby was a very effective marketer, but we also know how that ended. Personally, I think promoting the protocol right now should focus on building and facts, and stay away from anything that can be seen as hype and shilling for the near futureābut also, more users is good for the health of the protocol, and marketing plays a big part in that.
Thanks @dudesahn, I appreciate the thoughtfult response. Iām pretty sure there is very intense work being done by development that should probably pay out well, but from the outside, the protocol surely took a dip. I would like to get more feedback from the community on how Non Developers can add value more effectively if we donāt go the route suggested above.
I think a main issue from the core dev teamās side is that folks like @banteg and @fubuloubu are neck deep in vault V2 code launch, which is (and should be) a high priority for the team. Once thatās launched, Iām hopeful that more focus and attention can come back into product launches.
Speaking from experience, when I was first proposing strategies to the forum and to the Discord I had no idea how to get these proposals live. I spoke to Kirby (who was Comms head at the time) to try to figure out how to go about launching these ideas, but even he didnāt know. Thankfully I teamed up with @macarse and weāve been writing things in the background.
I do agree that we need to figure out a better mechanism for proposing / implementing changes, or interacting with the devs. Maybe we should consider creating a spokesperson position, where they interact with the devs on their telegram channel and then are able to better answer questions from the community.
I think @dudesahn covered a lot, I agree with him. Please remember we are a very young project and we are building as fast as we can. Sometimes we miss stuff, I know, thatās why I love to read new ideas, or a call out to deal with some ache.
@mattdw regarding the strategy submission process you talked about, we know about it and we are working on a process (the doc is 80% done) to submit strategies to Yearn Finance. Your case inspired us to do it, I talked with @macarse about it. We will share it with the community as soon as we have it finished.
Adding a vaults is a difficult and challenging process. We need to thoroughly check the strategy and vault before deploying it. We have to be sure itās safe, not only the code but the economic side.
I think itās great to get devs long term skin in the game (have the protocol buy back YFI w/ profits + give those to protocol/strategy/dev workers). Step 1 is building a YFI treasury where the intention of the YFI is to be vested/distributed to personnel on the protocol (can be further discussed on how this may look/terms, but step 1 is start accumulating) Iāll explain more below:
My worry as a YFI holder is key talent will leave to start something new, whether itās because they can get more rich quickly or because they donāt get to share in the upside. I want the core team to profit alongside the YFI community holders (who canāt write code, like myself) if $YFI token goes up and a way to do that is to further align incentives by making sure they too have $YFI to hold. I may be a minority here, but I would rather we pay out less to people like myself for now and instead build up a dev treasury where we are buying YFI + putting it into this treasury, with the intention of distributing it/rewarding those who work on the protocol. I feel that is step 1 before we start to take āprofitsā for everyone elseā¦ and I say that as a non-dev but as someone who just wants to make sure the health of the network can run in perpetuity and not just on altruism sunshine and rainbows. I also worry I see so many stingy community members who are worried about doing something like this and wonder if these people realize our only moat is to build something useful, and the best way to build something useful people use is to actually have (good) builders stick around and create it ā itās that simple. We need more robust incentives so we can actually grow the pie sustainability and more fairly. Yes to all, especially anything that allows us to move/iterate faster & having harvest flippen TVL shows agility/ability to adapt needs to be a core feature of YFI (along with retaining key talent!)
@mattdw Iāve been exactly there; hell, Iāve got twenty or so prototypes for varying vault mechanisms, objectives, goals, and through their evolution Iāve become more and more confronted with the possibility of sharing these resources. It feels as though with each iteration, both for improving prior and framing new strategies, the freedom for incredible creativity seems to grow. Even with the same parameters being adhered to, and design/functionality goals being met, there seems to be an awesome amount of critical thinking that goes into it. Of course, I will be waiting to see how the strategies integrate with the v2 frameworks, but I think that, over time, a sharing and dissecting of proposed strategies between a group of people who enjoy optimization and the challenge that it presents will allow for some extremely innovative movements.
Fameal, I look forward to the release of that doc! I also understand the grind and pain that goes into rigorously backtesting. Lots of math, lots of data, and a lot of time is spent in plotting limits and quadruple checking to make sure the contract is airtight. It can be extremely tedious and monotonous - luckily thereās endless nuances to the solidity codebase, and we all know how āwonderful and extensivelyā documented each of their shortfalls are.
@kazuya due to the open nature of suggestions, proposals, PRs, and creativity that this kind of a project allows for, talent will always be flowing in and out. Even if a set team is charged with or delegates to a specific responsibility, different approaches from different creative minds will always result in the most optimal and diverse toolbox. As active community members participate more and less, the only genuine way to capture some of that is by documentation. The team has been, for the decentralized finance sector anyways, very good about recognizing the importance of documentation - that will and should carry over to being a part of any new implemented vault strategies. The more documented a function is with respect to purpose, specific target/desired outcome, design, limitations, and approach, the easier it becomes to build upon and learn from.
In regards to rewarding talent - whatās the compensation been like at present if any? For more in depth on my take with financial and capital allocation, thereās a newer post by me in a different thread with exactly that.
I see many have the idea of rewarding the working team with YFI. But the thought of Blue Kirby lingers, developers will have lotsa information which outsiders do not know. And I guess everyone knows what Blue Kirby did.
In the absence of a proper rules, it is as good as letting go a beast which may run amok.
Sorry, no honeyed words but we have to balance the rewards system and not allowing the ecosystem to be unbalanced.