Further Reduction of TRU Farming - Feedback Wanted

[Jacks]

Hi Everyone,

The TrustToken team wanted to propose a few more tweaks to the TRU emission schedule based on what we’ve heard and observed in Discord.

Here is where we stand now after the previous reduction in TRU rewards across the various farms:

The Nexus Mutual reward allocation has already been cut in half from what was originally planned and there have been no complaints against it, the plan for now is to leave it be.

We have a great amount of borrower demand right now and should continue incentivize the TrueFi Lending pool and TRU stakers as both participants are needed to make additional loans.

To clarify, the APY for the TrueFi Lending Pool is well above 100% at the time of this writing (~132%) and NOT the 8.19% displayed at https://app.truefi.io/farm, this is an UI error and we are rolling out a fix shortly.

You can double check the current APYs across all our farms with this nifty tool built by a community member (credit to: VFat?) - https://vfat.tools/truefi/

TLDR - Lending pool APY is higher than displayed. Some pools are more useful to TRU holders than others, more TUSD deposits leads to more/bigger loans which benefits TRU token holders. Let’s lower rewards for pools that don’t benefit TRU holders and focus on the growing the lending pool and loan volume

The following is what we’d like to propose for each of the remaining farming opportunities, once we get some initial feedback this will be formalized into the first TrueFi Snapshot Proposal:

1. Reduce rewards for Uniswap ETH <> TRU Pool by:

• 50%
• 75%
• 100%
• None of the above [Please propose alternatives]

Reasoning:
Majority of TRU/ETH liquidity right now is being provided by TrustToken team, further reduction of these rewards would be beneficial for rest of TRU holders.

Former TRU/ETH LPs can move into TrueFi Lending Pool for more stable yield with much less price exposure.

2. Reduce rewards for Uniswap TFI-LP/TUSD pool by:

• 15%
• 20%
• 25%
• None of the above [Please propose alternatives]

Reasoning:
After listening to your feedback we realized that Uniswap is not the optimal place for a pool like this, slippage/price impact can be significant for large swaps. This plan is to slowly phase out this pool in favor of a native TrueFi pool that will enable lenders sell their pool tokens back to the TrueFi Lending Pool for TUSD. More detail on to come on this.

We’re looking forward to hearing your thoughts!

[Kenny]

I completely agree with these two proposals. TrueFi is an uncollateralized lending platform. It should focus on that. While farming is a great way to provide liquidity to a new token, the company is already providing most of that liquidity currently and there’s already plenty of liquidity there. I could be supportive of another 30 days of farming at most but beyond there, there’s little value to be had and there’s also the issue of those newly minted coins creating sell pressure on the TRU token. Anyways, I’m 100% supportive.

[dnlklr]

@Jacks

Yield Farming Info

I understand the rationale, but this is a pretty bad deal for the early uniswap LPs (before price collapsed from .33 to .10 in 30 hours) who were counting on making back their massive IL by waiting it out through the originally stated duration of the farm.

[Jacks]

That is a good point too.

Instead of an outright 50% reduction… what if it tapered off over the next 5 weeks? 10% less every week. We could also shift some of our provided liquidity in parallel, so all current/long-time Uniswap LPs gain a larger share of TRU rewards.

[rafaelcosman]

@Jacks- Overall I strongly agree with the proposal.

@dnlklr

early uniswap LPs (before price collapsed from .33 to .10 in 30 hours) who were counting on making back their massive IL by waiting it out through the originally stated duration of the farm.

Assuming that TRU price does increase again, they should still recover all of their IL and then some.

[Kityara]

Hello, I bought TRU but I don’t know how to get into staking, there are other tokens required for staking. Help

[rafaelcosman]

@Kityara

Hello, I bought TRU but I don’t know how to get into staking, there are other tokens required for staking. Help

It depends on which farm you want to use… to directly stake on loans, no there are no other tokens you need. If you want to farm the ETH/TRU farm, for example, you’d need ETH as well.

==
@Jacks - I actually would propose reducing the TFI-LP farm as well. We just shipped a fix for the APY calculations in the dashboard and it’s currently around 120% APY. This may drop when people realize how favorable it is, but I think it’s still a case of better to farm valuable TRU than lots of cheap TRU. Thus I’d propose a significant reduction in this farm, e.g. 50%. Ultimately I think this will be better for the community & the protocol long-term.

[Kenny]

I totally agree that more valuable tokens > a lot of cheap tokens.

In the end, if the price of TRU is 2x and rewards is 1/2, it winds up being the same APY.

In fact, reducing emissions might yield even more APY because it’ll help improve the price of TRU.

So totally in agreement with both Rafael and Jack.

[josjo80]

Are TFI-LP tokens the tokens we receive upon staking TRU on a loan request? Are they available to then stake if the loan hasn’t been approved yet, or only after approval?

[feewet]

I would be in favor of tapering off TRU emissions for the UNI/ETH pool but not outright reducing it by 50% in one chunk. Generally dramatic changes in any farming pool aren’t great for current farmers.

[Jacks]

Further Reduction of TRU Farming - Feedback Wanted

That is a good point too. Instead of an outright 50% reduction… what if it tapered off over the next 5 weeks? 10% less every week. We could also shift some of our provided liquidity in parallel, so all current/long-time Uniswap LPs gain a larger share of TRU rewards.

Ya i actually really like the idea of something like ^

[rafaelcosman]

@feewet

Generally dramatic changes in any farming pool aren’t great for current farmers.

As a farmer myself I commiserate. But I think to build a great protocol we need to, in general, put the interest of the protocol over the interest of farmers. Ultimately we’re looking to build the world’s best uncollateralized lending protocol not the world’s best farming protocol. Farming needs to be in strictly in service of this or it’s the tail wagging the dog.

[rafaelcosman]

Based on the polling above, I’m proposing that we move forward with the following. This is meant to be consistent with the middle of community sentiment- it doesn’t go as far as some would like and goes farther than others would like, but overall I think it’s a good step.

Proposal

1. 75% reduction for the ETH/TRU Uniswap Farm
   202,166 TRU/day -> 50,541 TRU/day

2. 25% reduction for the TFI-LP/TUSD Uniswap Farm
   156,960 TRU/day - > 117,720 TRU/day

3. 15% reduction for the TFI-LP Farm
   171,138 TRU/day - > 145,467 TRU/day

Other farms: no change at this time.

Vote on Proposal

• YES I agree with the proposal as stated
• NO I disagree with the proposal

If YES gets 51% of the vote we will implement the proposal
If NO gets 50% of the vote we will discuss as a community how to adjust and then take a new vote.

[valueseeker]

I cannot vote somehow. Can you check the poll?

[luciobosque]

I Can’t vote something is wrong

[dnlklr]

Can’t vote either. I’m a Yes, but only if the team withdraws a proportionate amount of liquidity from the eth/tru farm. I was also a fan of @Jacks tapering off suggestion.

[leecrowhurst]

I’m signed in and can not vote either.

Can the poll be extended after it has been fixed/opened to give everyone around the world enough time to see this and vote?

[TeresaA]

@rafaelcosman . Can’t seem to vote.

[Jacks]

Poll as been fixed @luciobosque @leecrowhurst

[leecrowhurst]

Thanks mate