[AIP-2] auraBAL Reward Reallocation

Proposals
1

Authors: PhiJFry, 0xButterfield (Aura)

Summary

This proposal suggests redirecting current rewards for the auraBAL/[8020 BAL/ETH BPT] pool (also referred to as ”auraBAL LPs”) to bribes and direct incentives for the pool via its Balancer gauge, in order to avoid fragmentation of auraBAL liquidity and to increase the effectiveness of AURA rewards on liquidity and price action.

Background

As initially laid out in the launch tokenomics, 10m AURA (10% of total supply) is being distributed over a 5-year period via an immutable MasterChef contract directly to auraBAL LPs, summing to approximately 38k AURA per week.

Now that the auraBAL Stable Pool gauge has been deployed and added to the Aura frontend, incentives for this BPT are now split between two locations, causing unnecessary fragmentation.

This proposal suggests redirecting these rewards to consolidate auraBAL liquidity, so that all liquidity providers can collect both BAL and AURA as a reward for their participation.

Proposed terms

This proposal would see a redirection of the MasterChef reward emission as follows:

Current
100% => B-auraBAL-STABLE BPT

Proposed
50% => auraBAL LP gauge bribes (across both veBAL and vlAURA)
50% => auraBAL LP gauge rewards, as direct incentives for this pool
0% => B-auraBAL-STABLE BPT

This would be accomplished by adding two new private pools capable of claiming AURA rewards to the MasterChef contract, and setting the allocation points to zero on the current pool.

Technical specification

The following groups of transactions would be executed by the protocol multisig:

  1. Deploy a forwarder contract allowing AURA to be claimed and then forwarded to a secure EOA delegated by the Protocol DAO. The EOA would be responsible for bribing across both the veBAL and vlAURA bribe markets on Redacted’s Hidden Hand.
  2. Call setExtraReward on the reward stash with the AURA address, and add a reward hook to the auraBAL gauge reward stash that pulls rewards directly from the MasterChef contract.
  3. Set allocation points to zero for the current auraBAL rewards pool.

Voting

This vote will be a single-choice vote. You may vote “For” or “Against” this proposal, or choose to abstain from the vote. Replies to this post should be used for an open discussion on the subject.

By voting “For” this proposal, you are voting in favour of the reallocation of AURA in accordance with the specification set out in this proposal.

8 Likes
2

This looks like a great proposal. The one thing I would maybe suggest is starting with like 90% AURA bribe market and slowly ramping down to 50/50 maybe by like 10% per week.

A lot of loyal HODLers chose to lock their tokens, it would be nice to give them a way to vote with them and earn some liquid AURA to start farming LP. A few weeks of rounds of real high AURA yields on AURA HH would do a lot I think.

Support as it stands as well.

7 Likes
3

Nicely written proposal, biases aside, I think it is a more efficient use of AURA emissions as we are ranging between $10-11 in emissions for every $1 spent in bribes. Considering the goal to extend Aura out to other protocols, getting as much as you can out of this supply is crucial. As we grow with you guys, we can also make new Hidden Hand markets to run a similar playbook across other protocols that you guys choose to expand out to. I think it would be worthwhile to propose to the Redacted DAO that we lock up the new AURA that will be flowing into the treasury from the fees sourced by this new AIP into either graviAURA or vlAURA so that we can guarantee that a fair chunk of these emissions will be perma-locked. :palm_down_hand: :butterfly:

5 Likes
4

For the 50% in emissions directed towards HH bribes, will that be fully utilized each round or discretionary, and across veBAL and vlAURA, will the bribes be evenly split across these markets?

Otherwise, great proposal, brothers, I’m in full support.

(Note: This issue is resolved.)

2 Likes
5

This helps boost rewards for LPs and I think bribes will help quickly pull auraBAL back to 1:1 parity assuming the rewards are high enough.

Don’t see any downside to this.

2 Likes
6

I think this proposal aligns nicely with our [BIP-19] Incentivize Core Pools & L2 Usage initiative. I am fully supporting this welcomed change!

1 Like
7

Reading again, this proposal would be safer and stronger if the bribes were done from a multisig. Here is code that BadgerDAO has used to place hidden hand bribes. Let us know if you need help working with this repo or getting this setup.

1 Like