I don’t like the idea of a time lock as it may scare away new investors, those new to DEX’s or even ETH as a whole. All while making the price less stable because you don’t know when some Whale is going to dump after their time lock is up.
I oppose to this because this will lead to a dump situation, If uniswap team decide to open the UNI-ETH pool and give UNI rewards to those pools, what will happen is that most UNI holders will stake their coins at that pool and the few remaining in circulation will be the ones that will decide its price and if a ETH-UNI whale staking at that pool decides to sell his rewards even the smallest sell will collapse price and people staked at that pool will be subjected at a hughe loss since they have wrapped versions of a token (impermanent loss)
In fact this was the modus operandi of previous DeFi scam teams.
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If there is an higher liquidity on UNI-ETH it will be harder for the price to dump because it would require much more UNI to be sold.
Why do you care about CEXs when Uniswap is a DEX? Rewarding people who put liquidity into trading UNI makes perfect sense. It didn’t make sense to put it up right away but definitely at some point it should be considered. CEX pairs are pretty meaningless when it comes to this
On the Uniswap exchange maybe yes, the problem is that we are being traded on Binance, which is where prices are taken. That is why if most of the UNIs are staked in the uniswap pool, the price difference would cause the UNIs distributed in the liquidity campaign to be sold in the foreign market, and since the foreign market has low UNI liquidity, price volatility will be higher, therefore if a whale staking at UNI pool decided to sell all his UNI, price dump will occur
Is there a way to make rewards specific to local UNI pools on UniSwap to keep incentive local ?
I think this proposition if realized wisely would benefit Uniswap ecosystem and UNI token holders greatly over the long term .
In my opinion UNI/ETH pool is the only ‘speculative asset’ pool that makes sense to add for additional UNI distribution.
- Let’s take a look at it from UNI token holder’s point of view.
At this point in time if you want to maximize the amount of UNI tokens you own over the next 4 years of the token distribution, it is not quite obvious whether or not you should add your UNI tokens to UNI/ETH liquidity pool or just hold them.
Because there is a real risk that if over the next 4 years UNI price rises over ETH significantly and stays that way, that because of impermanent loss problem you’ll have less UNI than a person who did nothing with them, i.e. who didn’t provide value for the network in terms of adding liquidity.
So distributing some additional UNI towards UNI/ETH liquidity providers would eliminate that problem and make the decision easy for long term UNI holder.
- On the other hand, it would complicate the decision for liquidity providers of other current pairs.
For example, if you’re providing liquidity on ETH/USDT ‘for money’, at this point it’s quite obvious for you to sell the crops for your yield farm for a coin that has store of value capacity. Like, a YFI vault pool would make a perfect job for you at executing whatever APY there is to be farmed by just mining and selling the UNI tokens.
If we were to introduce UNI/ETH rewards, these calculations become much less obvious, which in turn removes a decent bit of selling pressure from UNI token .
So both points feed into supporting long term holders of UNI token . And getting them to own bigger % of overall supply, which is fundamentally a good thing for the network development.
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Selling pressure is a problem only if the token is useless.
If UNI token gives fees then the price will find an healthy equilibrium.
Everything else is speculation : It reminds me of companies that buy back their own shares. This raises prices for a while only, but then it collapse because it creates no value.
Ok then, let’s completely disregard buying and selling pressure terms.
Given that liquidity provision is the main proposition Uniswap offers don’t you think that:
UNI token that provides liquidity in UNI-ETH pair is more valuable to the ecosystem then the UNI token that drains that liquidity by being staked ?
My position is that UNI/ETH Pool tokens provide more value to the ecosystem then UNI tokens alone. This means two things for me:
- UNI/ETH Pool tokens should have some sort of UNI loss insurance compared to simple holding of UNI tokens. This could be granted by a moderate amount of extra distribution of UNI tokens towards UNI/ETH pool
- UNI/ETH Pool tokens should be granted
- proportional voting rights to the amount of UNI locked in liquidity pair
- proportional amount of fees that are given to UNI holders
By no means do I argue with the point that fees distributed towards UNI token holders would bring the value to the token, I think it’s the most obvious thing to do.
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It seems to me that this is essential to the healthy functioning of the uniswap exchange. At the moment the majority of the circulating supply of UNI is held on centralised exchanges which means that uniswap can be controlled by its centralised competitors as far as i understand the situation. Having an extra incentive for the UNI/ETH pair should rebalance this and allow the users of uniswap to steer the decisions of the exchange towards sucsessful outcomes, rather than self destructive outcomes which is the likely desire of the big centralised exchanges.
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I see your point but I think that UNI is mostly held and traded on the centralised exchanges at the moment and this is a much bigger risk to uniswap governance than some short term price manipulation. A larger UNI/ETH pool and UNI rewards from it will help rebalance the control of the exchange back towards the users rather than uniswaps competitors.
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I agree. And UNI is the 4th highest volume market on both Coinbase and Binance, so it should definitely be in the short list of markets we want to incentivize. Currently this T1 list looks something like: LINK, UNI, YFI
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I agree! add ETH incentive to entice the community!
Very good point ! Aiming at the biggest markets in order for more people to come. New Uniswap customers will then use other pools and bring money to the system. THIS will increase the value of $UNI. Not throwing $UNI to ourselves, I agree.
@JokerTheBond noticed that the Curve AMM is much more efficient than Uniswap AMM for stablecoins exchange, which is true. So maybe we should concentrate on the other biggest markets : bridged BTC and biggest volume ERC20s. Today this would mean renBTC, and/or LINK, pooled with ETH and/or stablecoins.
Also btw, do we really need to incentivise other pools than the four we already incentivise ?
Notice than after BTC, ETH and LINK, the 4th biggest market on binance is $UNI/$USDT today 
So maybe we will come to incentivse $UNI pool some day. But I agree it is no the priority today.
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But why do you want to incentive this pool?
If UNI is successful and distributes a lot of fees, the trading volume and demand will naturally increase.
The core value of UNI is volume, not artificial support.
Right now there is no need to incentive any other pools : all the DEX volume is on Uniswap, Sushiswap is dead…
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The pool seems to currently earn around 65% APY. $50MM liquidity, Currently takes over $220k worth of UNI tokens (45000) to cause 1% slippage. I think it’s doing fine without the incentives so far.
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This is a good question.
I do agree that from the sheer liquidity provision standpoint the pool is incentivized enough at the moment by the fees. But I do not think that it is all about volume only: it is also about liquidity and it is also about governance.
From the governance standpoint it’s quite important that as many UNI tokens as possible either stay in people’s wallets or are locked in Uniswap contracts.
I think it is beneficial to encourage participation in UNI governance, and one just feeds into the other in the proposition I made. I’m sure there are alternative ways to solve for the same things.
Incentivization of UNI pairs + granting UNI LPs voting rights:
- makes it obvious that it is more fruitful to keep your UNI on Uniswap than on any other exchange
- allows UNI maximalists to participate in the distribution event in a safe way . People who only want to own UNI and ETH in this topic’s case. I definitely do think that this group of actors both deserves to receive the distribution rewards and is likely to contribute to the protocol development.
- It makes UNI produce value within the protocol instead of just sitting on the sidelines.
It is logical that when you get a mining rig in a mining factory – you mine. So it seems logical to me that the main token of a decentralized liquidity platform is super liquid, and it doesn’t compromise its governance.
In a good, fair system where incentives align evenly different groups of actors tend to mix with each other.
It shouldn’t be a choice for you to get rewards because you vote or because you mine liquidity with your token, you should be able to do both as both provide value for the network.
If I were to propose the amount of additional UNI distributed to a pool, it would intend to create quite a moderate increase in the APY. I think that it would sound more or less fair if the APY for UNI pair would be on par with other pairs.
Also I do think that it is irresponsible to bring tokens that have weak store of value properties to Uniswap liquidity mining programme. So I would like to bring at least some of those properties to UNI, and the best way to do that is through fees distribution.
I do consider that just generally adding more UNI pairs would be beneficial for the token, not just UNI/ETH, but also UNI/USD and UNI/BTC. Let all the maximalists in 
But even beyond that, having more traded UNI pairs would very likely be beneficial. UNI could become the reserve currency of Uniswap, why not? If we were to manage UNI as an exchange token, exchanges do tend to list a ton of pairs for their tokens. Maybe it is not neccessary, the key question is: is it valueable enough that we wish to spend treasury funds to incentivise it?
I think at least incentivizing UNI/ETH and UNI/USD would be valuable, but maybe 1 type of dollar is enough.
But at the same time it is crucial that we don’t grant these pairs crazy APYs, as it would ruin everything very fast.
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This is a big reason why it would be good to add it to the list of pools eligible for rewards. Better to avoid the centralized exchanges holding UNI.
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It has. The more expensive uni is, the more difficult it is to buy them for accumulation in the same hands.
@iwearahoodie agree! 