Yfi_whale Proposals List

[milkyklim]

@CCLL @500bitcoins head to

YFI x SAINTFAME swag

I’ve been in contact with a number of people in the YFI community that would be interested in YFI oriented hoodies. I also have reached out to Jacob Horne who founded zora. We are going to put something together for the community. Hop in here if you would be interested in this. Funding/cost discussions will need to happen in some capacity (either via individuals or more holistically if enough demand). More to come soon

for swag discussions

[Bigbrotha]

Thank you for putting all of this together. Also think this a good approach. Glad to see most people reject the idea of printing more yfi infinitely

[FarmerT]

I would like to see a “vote delegation” mechanism in place. I would definitely delegate my vote to you guys (girls?).

[iTo]

@yfi_whale once a schedule has been agreed, are you / your group in favour of burning the keys and removing the need to have multi-sig’ signatories?

[hiyoko]

By the end of this weekend, I think we need concrete proposals and their approval.
Founder 1000 YFI (2-4 years vesting period)
1000 YFI for development fund
10,000 YFI for 4 years to pool 3 (incentive pool)

I think YFI:yCRV such as 8:2 to 7:3 is good for incentive pool specifications.
Pool 1 and pool 2 may be abolished.

How about? Promptly formal proposal and its approval…

[steamer.eth]

1. imo Yearn is NOT a company, and cronje works on it not just for money.

2. Liquidity is the most important factor of YFI. Low inflation will result in most liquidity leaves for better yield and YFI’s price will be greatly dumped. Defi-farmers are not fools, nobody will take the high risks while get tiny yield.

3. No more fair YFI issued, no more members to join the community. Try to consider if BTC fully mined in seven days, and satoshi get 16%. How can consensus be made among the community?

[kvnbelanger]

We have some great stuff being discussed.

[banteg]

I think one way to reduce chaos of simultaneous on-chain proposals would be to poll for popular proposals on the forum and put the winning option for an on-chain vote. Repeat if it doesn’t pass. The obvious downside is that it won’t be a coin vote.

[iamaces]

@yfi_whale

Prop 1: Have burning of YFI to claim underlying fees instead of staking to claim underlying fees

For: N/A

Against: It makes no sense to burn because the price of YFI will always be higher than the claimable fee value. This is because YFI represents current assets in the fee pool plus future expected cashflows. Staking is just obviously better.

Can we have this proposal re-submitted and put up for a vote?

@yfi_whale

Within our group, the range of values we had was between 3000 and 12,000 new YFI issued ever. The emission period we had in mind was 2-3 years. We are also fine with some very small tail emission of at most 1% per year after the initial period (0% is fine too). We will vote against any proposal which is significantly higher than these numbers.

And regarding this one maybe we can create a poll for how much additional YFI should be issued?
3K? 6K? 9K? or 12K?

[JonathanErlich]

Thanks for doing this!

I’m for this proposal.

Inflation issuance makes sense. I would go for the lower bound though (or maybe some mid-point between 3000 and 12000).

My reasoning is the following:

I think YFI is undervalued based on what other DeFi projects are currently valued at. How undervalued? Let’s do some relative valuation.

In terms of Fully Diluted Market Cap. / TVL:

The cheapest notable DeFi project at the moment is Aave, which stands at 0.7 (383.4 M / 556.1M)

Meanwhile, yEarn has a Fully Diluted MC / TVL = 0.11

Thus, by this metric a fair valuation for YFI would be around 7200

For those wondering, this isn’t a metric I got out of my hat, but rather something used by top investors in the space (who understand it - not the typical VCs): https://twitter.com/SpartanBlack_1/status/1280783859894767616?s=20

In terms of P/E or rather, Price / Fees Generated, we have the following:

The cheapest notable DeFi project is Bancor, with a P/E of 39.

Meanwhile, assuming 50000 in weekly fees, we have the following P/E for yEarn: 37.5M / 2.6M = 14.4

Thus, by this metric YFI would be undervalued by a factor of 2.5x. A fair valuation, then, would be 3150 per YFI

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So, we have a fair price between 3150 and 7200. If we take the average we get a fair price of 5175. And this is conservative, as only the cheapest projects were taken into account for the relative valuation exercise.

In this sense, if we take the lower issuance bound of 3000, which implies around 1000 for Marketing, we would be allocating around 5M USD for Marketing expenses within 2-3 years.

If we go for a mid-point (7500 new YFI issued), we would allocate around 5500 YFI for Marketing purposes, which would imply an expense of about 28M within 2-3 years.

I would see something between the lower bound and the mid-point working pretty well.

[hc.link]

I will support the @yfi_whale model exclusively.

I motion to limit issuance to pool3(governance) and to phase out pool1(yCRV) and pool2(DAI) once the initial 20k YFI have been farmed out of these two pools. When emission rates drop to zero, yield farmers will be forced to withdraw their yCRV and DAI from what will become zero yield pools. While these two high yield pools were good for bootstrapping, they do not deliver long term value to the protocol. I do not foresee market participants dumping their YFI at the end of the 30k liquidity mining period, but a liquidity drain of pool1 and pool2 is expected. However, this is not a problem, given that we want people to withdraw their yCRV and DAI from these pools anyways. Limiting further pool issuance to pool3 will phase out pool1 and pool2 by the natural action of game theory, while simultaneously incentivising liquidity from those pools to move into the governance pool (pool3).

The number 42 provides memetic synergy with chainlink, and I am inclined to believe that this is a significant synchronicity in the context of YFI and this proposal. I am therefore in support of a motion to mint 1k YFI for @andre.cronje to incentivize his genius, 1k as a general governance treasury, and 10k to be distributed via pool3 liquidity mining to incentivize governance participation. The 10k allocated to pool3 should be distributed in accordance with the timeframe proposed by @yfi_whale. Following the minting of these 12k tokens, minting keys should be burned leaving total supply at 42k YFI forever. Other incentives to build value into YFI can be proposed at a later date.

I will reject all other models of token issuance. The 42 model rewards genius, secures a treasury, and provides a small amount of inflation to incentivize governance participation (which is the whole point of YFI in the first place).

[TGT]

I like the reasoning framework. It’s our common objective to increase YFI price (and ecosystem value) in a sustainable way, which is just like running a listed company. We can adopt proven business and financial practices from real world without re-inventing the wheels. A few things we will typically look at when managing a listed company:

1. Capital Market. This is of course the most important thing - keep the YFI price going up. We will have lot of discuss here but one thing to note is that, the reason why S&P500 is so high is becuase of share buy back. YFI should have a buy-back mechanism to allow certain percentage of revenue to buy back YFI tokens from the market and keep in reserve, which can be burned or used for value-creation activities.

2. Human Resources. On top of the compensation plan for Andre, there should be a similar plan to recruit future talents. The compensation must be competitive and tied to KPI, and subject to quarterly review and voting by all YFI holders.

3. Strategy and Operation. This is where the management team (Andre for now) needs to deliver since they are paid a competitive salary. They need to propose the business strategy to YFI token holders (just like board members in a listed company) on a timely basis and upon approval, implement the strategy (including not only coding, but also marketing and business development) .

So the more I think about this, the more it feels like a distributed board on blockchain. If we can managed a commercial project well via this coordinated crown intelligence, we probably can manage a town or a country well. By that time, why do we need a president like Trump…

[nightmayoralty]

I am FOR this set of proposals and the reasoning behind it.

Yes @TGT When people call things ‘governance tokens’ what they really mean is its like a company share: that too is a governance right… but often comes with a dividend, and with expectation of a capital gain if you’re lucky too.

@deltatiger SNX should not be mentioned as a frame of reference for inflation here. Speaking as someone who was into Havven/SNX very early, SNX had a very different set of needs and was at a very different stage of development.

The default position should be no inflation without good reason. Rewarding Andre, and other measures as outlined above, are good reasons. Others will come to in future.

[drolitjie]

You mention the “hedged stable coin index”. That sounds like a pool ist better than single stable coins. But isn’t it 4x more vulnerable, because each of these stable coins may fail?

Especially USDT does not seem to deserve a lot of trust.

I am sure you understand these implications better than me, so I am curious what I am missing.

[cyrus]

Very coherent and well thought out thesis. Great read.

[vipmoney]

I am in general alignment with you guys, you seem to have a long term vision. YFI Whales you got my vote, keep those proposals coming

[deltatiger]

@yfi_whale I liked your post and agree with a lot of it.

This was the direction I was looking for when trying to adapt the SNX model for this project and community. The model now has a version that closely matches the inputs/outputs you suggested against a smooth declining curve over a 3 year period starting at 50% annual inflation and declining to 1%, which ends up generating and additional 12k approx YFI tokens after 3 years.

Would be interested in hearing any feedback.

[JonathanErlich]

I like how that curve looks, although I think aiming for 12k inflation is high. Imo we should aim for something around 7500 additional YFI.

Here’s my reasoning: Yfi_whale Proposals List

[ChainLinkGod]

Very interesting post, thanks for sharing fren. I think the inflation you suggest is a little low, but some inflation over no inflation is definitely ideal imho.

Prop 1: Have burning of YFI to claim underlying fees instead of staking to claim underlying fees
For: N/A
Against: It makes no sense to burn because the price of YFI will always be higher than the claimable fee value. This is because YFI represents current assets in the fee pool plus future expected cashflows. Staking is just obviously better.

I’m in total agreement here, the future supply of FYI is important, but that doesn’t mean anything if the underlying tokenomics of YFI doesn’t make any sense. Burning YFI to claim fees creates a price floor, but 99% of the time it will make no sense for a user to burn their YFI versus selling it on the market.

This could be replaced by a traditional automated buy-back and burn scheme (although this runs contrary to inflation and doesn’t make much sense). I think staking YFI directly to earn fees is the best way to go. Grows organic demand for YFI as a right to cash flow of the iearn ecosystem. This creates a reason for somebody new to actually go out and buy YFI beyond just speculation and voting. In reality we need all three, speculation (creating growth), cash flows (benefits from growth), and voting (direct system growth).

[yfi_whale]

We have mixed feelings here. On one hand, burning the keys gives certainty to monetary policy which is very good. The market will likely react favorable to greater certainty and determinism. On the other hand, we will no longer have the ability to create new YFI for future unforeseen needs like new project incentives, expansion of a developer team, etc. So far we are split on this issue and have not come to consensus.