The Elephant In The Room

TRDL went on a big rip and reached the eyes of thousands. The TRDL rewards are incentivizing those providing TRDL more than vBTC which is a problem. vBTC has been below the peg for two weeks. We waited for the itchi pools to somehow solve this issue but there’s no results coming in. vBTC is currently 18k below the peg and volume is abysmal compared to trdl.

When the project started rewards were 60% for vBTC pool and 40% for the TRDL pool. When Ataxia came in he suggested that these should be flipped. It worked to bring in a audience. Now that the audience is here there is a clear focus on TRDL over vBTC. As CT Krypt put it “They are buying gas to a vehicle without even having a car.”

The audience is here and they like the project. The vBTC pool needs to be incentivized for the well being of the project.

So the proposal is to return the pool rewards to their original distribution percentages of
60% - vBTC/ETH
40% - TRDL/ETH

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A Request for Patience

First, Let me say that I understand the concern and think this is a sensible solution to try if the issue persists. I’d like to leave a record of my rationale for the current setup. The reason behind having the $TRDL pool (Pool 0) have the higher returns is that this pool is receiving all the selling pressure from the newly minted strudels. If other pools are yielding more strudels than pool 0 then “Based on a game theory perspective” its never a good idea to provide liquidity in pool 0 because there’s a better incentive elsewhere.

Whenever a complex protocol like this changes we cannot expect the results to be shown immediately. I expect to see some changes in the liquidity over the next few days that would solve the issues we are having right now by making vBTC a much more desireable asset to hold and bring it closer to the peg.

These include:

  1. The usage of a new arbitrage route that has a net effect of leaving ETH on the vBTC pool https://etherscan.io/tx/0xc7830ca0f3ea80801c8b04aeb117ca4e1d8b483c83b4cae3567104bf14ef66b3

  2. The increased APY on the $TRDL farm by people choosing to stake at $SUSHI

  3. Increased number of holders because its a requirement to mint oneVBTC which is inside the arbitrage route in 1)

We cant really judge the current changes in the protocol just one day after they have been implemented. I ask the community to have a 7 day waiting period before committing to changing the rewards schedule.

If anything we should talk about allocating some $TRDL rewards to the Balancer liquidity, which is a very efficient way to provide liquidity to bot $TRDL, vBTC and LP providers who can exit without removing liquidity.

Best,

Ataxia

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“If other pools are yielding more strudels than pool 0 then “Based on a game theory perspective” its never a good idea to provide liquidity in pool 0 because there’s a better incentive elsewhere.”

This argument is flawed. The difference between the pools is 2,400 TRDL and 3,600 TRDL per day. People will provide liquidity to get these tokens. As seen both pools have been shown to have roughly the same apy.

Also earlier you were stating that farming rewards doesn’t affect the price in a over bearing nature. I’m not saying remove the rewards for providing liquidity for trdl. There will still be plenty of rewards.

I would like to have a deadline set where the rewards get flipped if vbtc doesn’t reach it’s peg. I say 2 more weeks. If the peg isn’t reached in two weeks the rewards should flip imo.

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The rewards are great and lucrative for anyone eyeing strudel.finance. It is without a thought that this high APY will continue if more vBTC is minted because of the burning curve and the multiplier where rewards go x4 to over 4000%!!! BTC can only be minted if vBTC pegs. There are clear economics that I’ve witnessed and seen, BTC will not be burned until vBTC gets to peg, and if it doesn’t peg, the whole project is has a detrimental side effect, TRDL rewards get dumped for ETH then TRDL price gets dropped significantly because it is fragile. For those who want to burn more BTC, like me, I simply cannot because there is a loss due to it being under pegged. If it was 1-3% difference why not, the TRDL rewards to burn BTC offsets those small losses.

Here is a solution, its a penalized protocol. Others have already expressed that im insane for bringing up this solution and this is not how it works yadda yadda, but before not thinking it through, please consider this perspective. I want to be frank, when I calculated that I would get 10%-3% gains a day, I wanted to sell the TRDL for ETH double my money and leave before it becomes illiquid, this clearly a game a lot of people plan on playing and dont be innocent. This project isnt a rug pull and we have to quit this type of behavior.

In the beginning I bought vBTC/ETH LP from those rewards I got TRDL I refarmed TRDL to the TRDL pool without the support of vBTC. I noticed if people exit the vBTC Pool it is as fragile as TRDL. There is no established protocol to move the TRDLs to vBTC.

I suggest that anyone who is farming that harvests to sell for ETH would be penalized for not selling it for vBTC. Those farming incentives are given due to a trust system that people will restake and support the vBTC and its not. This is very hard to do so a solution is this…

If we want a trustless bridge for vBTC then we need a trustless system that automatically take a % of the APY from the users harvest and when they “harvest” you get 50% TRDL and %50 vBTC in your wallet and if you decide to sell your vBTC then go head but atleast make TRDL buy vBTC.

Also, protocoling this penalization is not penalization, it is strictly to save vBTC and TRDL from getting dumped and those two fragilities protect each other.

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