Request for Comment: An Opportunisic Emission Model


An emission model that explicitly leverages yield farming as the mechanism for YFI distribution. During times at which new products are still in development or existing products are running smoothly on their own, YFI emission can be very low. When new products are released and we, as a community, want to incentivize their use or bootstrap liquidity, a proposal can be made and voted on to fund it. We could call these Genesis v2 funds and they could be time-locked and slowly released into the contract, creating a communal pool of YFI to be distributed for future yield harvests.

Shape of the curve is up for discussion. Could also burn if the pool becomes overly large. Voting could pay out from this pool. The mechanism for voting is not part of the scope of this proposal. This doesn’t answer the question of how much YFI emission there should be, but does allow for that conversation to be had as yEarn continues to grow.

For: Leans into the Yield Farming Meme. Allows a lot of flexibility and gives the power of the purse to the DAO. Creates a DAO that incentivizes its products with sizable rewards and incentivizes its holders to also be users and liquidity providers.

Against: Allows a lot of flexibility. Relies on governance and could exacerbate future political strife. Untested idea.


Is it even possible to issue off of fees generated from the incentivized product.
Maybe a flat incentive, plus a proportional bonus based off the income that product is bringing in.

This could drive farmers who come for the job to also promote to use of their supplied liquidity.

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Adopting a model like this would allow the community to experiment with different incentive mechanisms, curves, etc for specific products and launches, all while keeping circulating supply low. And most importantly it lets the DAO govern. Figuring out the voting mechanism and Pool ratios is still critically important.