[Discussion] Uniswap Liquidity Incentive Plan

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.

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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.

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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.

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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.

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Pure and utter censorship. I guess that speaks volumes for being willfully unwilling to lead a meaningful conversation and to censor opposing arguments and views.

Let’s not waste our time on this unnecessary argument. Please push this proposal forward. This community really needs to see the governance on Uniswap can actually work.

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I don’t think reinstating UNI rewards accomplishes anything significant enough to justify the massive inflation and devaluing of the UNI token.

  1. Currently $620M in liquidity in the 4 pairs signaled to be incentivized. More than sufficient.
  2. Less liquidity + same volume = more fees for LPs (that cancel out the UNI rewards).
  3. Current daily emission: 274,000 UNI. Daily emission with 5M LP rewards enacted: 440,000 UNI. @4 that’s potentially ~$53 million in monthly sell pressure that could be placed on the token. Could place UNI in the uninvestable category for sophisticated investors (like CRV, COMP, BAL, FIL).

The damage these additional 5M/month UNI rewards causes is tremendous. I hope when it comes time to vote, there is a silent majority who comes out to vote AGAINST the continuing of UNI LP rewards.

Let’s wait until liquidity hints at becoming a problem before throwing more UNI around in a way I’d consider wreckless.

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Why are we having bash war in here?

Simply put it to the vote and let’s see, everything else is just talk that won’t get Uniswap governance anywhere.

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We are not having a bash war here, we are having a civilized conversation based on merit and facts. This proposal showed how deeply divided the community is on this issue; therefore, it shouldnt even move to the voting stage as under normal circumstances even the temperature check wouldnt pass. Whats the point of calling a temp check when one guy with 1,5M votes passes the temp check???

2 people passed the temperature check. TWO votes. That is how decentralized we are. Instead of moving proposals like this, we should figure out a new way of voting. It is an issue.

I can make a temp check poll for my proposal, vote for it, it will pass the 50k threshold and say Im sorry guys, the community has spoken! The temperature check has passed! And other people from the community will not have a chance to outweigh my vote despite being the majority.

This makes utterly no sense at all.

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Amount of reports and “ad hominem” posts says otherwise

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The arbitrary censorship from the uncooperative, unwilling side who get mad at other people having a different opinion shows entirely how untrustworthy they are. I called them out on the temperature check ignoring the majority and the proposal stealing value from the holders while channeling it to the farmers and short sellers. No opposing arguments have been made on their side just blatant attempt at censorship. Vast majority of my posts have been already reinstated by staff as they did not break any rules.

Yes staff doing good job

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Sushiswap is chipping away at our liquidity once again. It will be much cheaper to do modest mining rewards for key pairs now rather than waiting until we need to do something drastic later. The business we are in is highly competitive and inflation rewards are just the reality of how we will have to defend the liquidity we have.

Yes but AFAICT Sushi is chipping the pairs that are not targeted by this vote

  • ETH-YFI
  • ETH-UMA
  • ETH-BAND
  • ETH-COMP
  • ETH-AAVE
  • and now ETH-CRV too (they now have more liquidity)

Their token had a surge in price because of the Andreswap announcements and such, making the LPing much more profitable.

We need to come up with a more dynamic way and more useful way to subsidize liquidity until V3 and hopefully L2 give us back the edge.

Sushiswap has a weekly menu-based approach where they propose and then vote on pairs.

I don’t have a million votes in my name or more, so I can’t really spearhead proposals here but… Why are we not more intelligent in our approach ? We have the data, we know what’s happening. Key DeFi pairs are being targeted and liquidity is moving. We could come up with something more thoughtful and based on data.

P.S.: Reminder that SUSHI has a vesting period on 2/3 of their rewards.

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