[Discussion] Uniswap Liquidity Incentive Plan

Over the last couple of days we have seen liquidity increase on pairs so it is a good sign that liquidity is stabilizing and increasing again. For example, the WBTC-ETH liquidity has increased from 145 million (11/26) to 199 million (11/28) flattening the slippage curve. You can now swap up to $15,000 of WBTC-ETH with only 0.01% slippage.
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This is a good flag. Perhaps if we are going to incentivize any pairs, if should be the pairs that we are not currently the DEX market leader. If this is the strategy we would want to target the following pairs with liquidity mining incentives: CRV-ETH, AAVE-ETH, UMA-ETH, COMP-ETH, SNX-ETH, BAND-ETH, YFI-ETH.


There is a combined $650M in liquidity for the 4 pairs we are signaling to incentivize. The original liquidity incentives created liquidity far beyond what was needed. Those pairs have sufficient liquidity without incentives. Why create significant inflation, devaluing UNI, to achieve a goal that we are already achieving?

I understand we would be cutting those rewards in half, but it still seems unnecessary.


Regarding the argument that we need to distribute more UNI to reach quorum in governance, https://explore.duneanalytics.com/public/dashboards/vYaXFE9DynDqNNE0WE3k5iFQJ5mgTVq5aD1OF9Ji shows that there are almost 90M UNI delegated. I don’t think the problem is circulating supply. I think the problem is finding a proposal the majority agrees on. So in this sense governance is functioning exactly as it should, rejecting proposals that a lot of people don’t like.


Totally agree with what you mentioned. :+1:

Hey everyone, quick update on the next steps - we’re still working on the distributor implementation so the proposal will not be submitted tomorrow. I’ll share an update in this thread once everything is ready for the proposal to move ahead.


You’re stating your opinions as fact.

This is how token based governance works; those who own more tokens get more voting power. Not a perfect system by any means, but there aren’t any great alternatives that are sybil resistant.

I think you should take a walk before hitting send next time.


Hey, when will the proposal be submitted since we already passed the temperature check.

Still working on technical implementation, I’ll share details here once we’re ready to submit a proposal.

So you didnt disprove any of the statements I made. Its not my opinion, its a FACT what I stated because we have just finished doing it. You are trying to manipulate the governance through this gibberish.

I will vote NO so should any holder of UNI as this is pure betrayal. You want to distribute more UNI to the already rich beyond their wildest dreams at the expense of the small UNI holder. Once again - Shame on you for promoting such a blatant cash grab.

There is a testament on the voting page of the cash grabs attempts of Dharma and co. and I sincerely hope the Uniswap community will rally once more and do the same again.


What makes UNI have such weak performance in the market, which is quite opposite to its dominant position in DEX? I used to have the same view with you, that selling pressure from the liquidity mining is the main reason. Actually, that’s maybe not the truth.

As a governance token, the core value of UNI should be shown its power to make more optimizations on the ecosystems and communities. Whenever we can use this power by passing a proposal to make some changes, even it’s not a perfect one, it will still be a strong positive message to the market to say that UNI works, Uniswap community governance works.

To be honest, I was quite upset about the chaos of the community governance process. Even tried to use some radical ways to push it ahead. After dive deep in the governance process, I know that I should have more patience and respect, especially to those who truly working hard to make contributions to the whole community.

We are quite close to the first community proposal come into live. Time will tell!

The liquidity campain incentivizes short sellers to pummel it along with the farmers and release more of UNI into circulation for little benefit. Its a pure cash grab just like Dharma´s proposal.

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This just hurts UNI holders. Volume has stayed the same, so the pools are even more profitable now for liquidity stakers without taking incentivization into consideration. Incentivizing LPs dilutes supply. UNI should be used to either incentivize new tech, or get sent to UNI holders.
If instead of rewarding liquidity providers you distribute UNI from treasure proportionally to UNI holders, then UNI holders maintain their current ratio (to overcome minting that will be sent to devs) and no riders get to leech off the protocol.


You have the right to your own opinion, but please don’t be so rude here. There’s no conspiracy. We’re just trying to figure out what’s good for the Unicorn.

I’m a small holder/buyer myself, and an UNI LP dealing with impermanent loss at this time. That being said, I’m still unsure of what I should vote. On one side, many DEXes are trying to dethrone Uniswap at the same time. One of DeFi’s biggest innovator, Andre Cronje (yEarn fame) just (today) teamed up with Sushiswap to compete with Uni and bring the forked Uniswap V2 code to another level (introduce options, etc.) On the other side, Uni has networks effects playing in its favor and doesn’t seem to be immediately in danger. (Also, it pays LPs 0.3% instead of 0.25% for Sushi, which turned on its fee switch)

In my view, we should start incentivizing end users (client-side mining, find a way to incentivize swap). It would be less costly than liquidity mining and have good distribution effects. It could be run in parallel to the LM campaign.

We are all waiting for V3 to land and during that time, I think it’s best to play it safe. Now, I would have reduced the budget of the second LM campaign to something like a third of what it was, not half… but that’s what we get to vote on.

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Yes, I’ll give you that. Andre is talented, but he has a weird vibe. He tried to become a Uni politician and he tried to make the Dharma vote pass, yes. He failed at both.

Actually, if the APY is better for LPs now that the campaign has stopped, maybe miners actually cared about holding some of the UNI they mined. Otherwise, it’s hard to explain how they would favor lower APY.

BTW I don’t find the UNI-ETH LP incentives idea to be as appealing as it once was. Uni is already just below DAI in terms of liquidity, so no real problem there in my view. It could be a double edged sword : we lose voting power and there is more liquidity for whales to dump. If the liquidity doubles overnight, it also kind of becomes harder to move the price, which could either be good or bad.

As I said, it’s a tough decision. I’d really like it if the team could enlighten us a bit more on the roadmap. I think it’s coming soon in any event. They said « in the coming months » in August, so it can’t be that far. In any event, I believe V3 will make Sushiswap and other DEXes obsolete for a while.

Are you sure stealing is a fitting description? From my viewpoint its an open discussion about the future usage of uni. Its open and everyone will be heared. You were only asked to be more polite in conversation. I would at least consider this.


How about distribute UNI to delegated UNI holders? [Temperature check] Distribute UNI to delegated UNI holder

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Great job. :+1:
Noticed that you have about 1M delegated votes. Do you have any plan to reach the threshold of submit an on chain voting?

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@Buckerino I object to your wording of “stealing”. Who made you the sole decider of what is good for UNI holders and the Uniswap community?

More importantly, personal attacks will discourage potential community contributors. This is HUGELY negative for Uniswap, and for the value of the UNI token. Check yourself. If this was in most other governance forums, you would have already been moderated for your toxic behavior.


See, this is exactly what I am talking about.

You yourself are violating the community guidelines.

The guidelines state one should avoid :

  • Responding to a post’s tone instead of its actual content

How did you last comment contribute to the conversation? To the arguments I have outlined for you there? No answers were provided, no counter arguments, anything of that sort. Just plain knee-jerk reaction. I fail to see it so I shall flag your response to the comment as I think it violates the rule.