As of writing, Sushiswap TRU liquidity is $1.3m, supported by SUSHI rewards on the Onsen Menu. There’s an opportunity to increase TRU volume on Sushiswap, which may help us reach a new audience of users, by opening Sushiswap farming incentives.
If we implement this before March, we should also be able to offer Sushiswap LPs double rewards: SUSHI from the Onsen Menu and TRU from TrueFi Sushiswap LP farming incentives - which would be a first. A key metric is adding new wallets holding TRU, with a goal of 2,500 (approx 1,840 now).
As TRU holders voted to decrease farming rewards in December, there’s ample tokens left in the pool of TRU tokens designated for growth and community incentives to create a new farm.
The poll below is designed to gauge sentiment for such a farm - exact token allocations will be modeled based on suggestions and sent to a community vote.
Some added context on each option:
YES to 1:1 farm: This vote suggests creating a brand new Sushiswap LP farm with the same TRU token allocation as the existing Uniswap farm of 50,541 TRU/day, increasing overall outgoing TRU.
YES to 50/50 migration: This vote suggests creating a brand new Sushiswap LP farm and migrating 50% of TRU incentives currently allocated to Uniswap to this new farm, keeping overall TRU farming outflows the same.
Alternative in Comments: Write your suggestion in the comments.
NO to new farm: This vote stands against a new Sushiswap farm.
EDIT Jan 24: Based on the substantive discussion in this post, a fairly widely endorsed option not originally listed in the poll - a 100% Uniswap → Sushiswap migration - is being considered. As there is no way to edit the poll without voiding the results, a new poll may be launched or the alternative may move directly to a Snapshot vote unless there’s explicit opposition.
This is a GREAT idea Michael. Double-stacking TRU on Sushiswap will absolutely get a ton more users to provide liquidity. It’s brilliant. Thanks for proposing it.
I’m voting some kind of yes. However, the two existing YES options both end up with the same number of TRU/day allocated to Uniswap and Sushiswap farms. Since the Sushiswap farm is already incentivized by the Onsen rewards, might it make sense to allocate somewhat less TRU/day to it? I don’t have an exact number in mind, nor do I have a strong opinion on new rewards vs migration, but e.g. maybe a 40/60 migration or something?
as a LP, I really only care about APY. If the APY is high enough, I will close my eyes and jump in hoping that the APY will justify any large IL risk.
The Sushiswap pool is small right now and the slippage is HUGE. Here’s a chance to really get people motivated to become LP on Sushi for the next 27 days. If after the Onsen rewards end in 27 days, the price of TRU appreciates enough and the TRU farm rewards on Sushi are still pretty good, I might not pull my liquidity out. I may continue to supply liquidity on Sushi. But if after the onsen rewards are gone, and my rewards are worse than those on UNI, I will DEFINITELY withdraw my liquidity on Sushi and stake them on UNI since it has higher yields. So the net gain is some added liquidity on Sushi for 27 days and then everyone withdraws their liquidity or moves over to UNI – defeating the purpose of the stacked rewards in the first place. It becomes a wasted opportunity, IMO – since these Onsen Sushi rewards are only for a limited time.
I think TRU is already liquid enough after listing in Binance. Most crypto traders are reachable on either Binance, Uniswap and FTX. I don’t think the value-added of Sushiswap is enough to justify the incentives to be provided to LP there. Sushiswap LP can already get SUSHI as reward.
More supply of TRU will lower the price of TRU, thus harm the interest of LP providers in Uniswap, TRU hodlers and lenders. Their TRU earned will worth less.
It sounds like this would argue against anything but an equal incentive (whether 1:1 or 50/50), on the basis of hurting us after the Onsen is finished should we do 60/40 or anything otherwise tilted.
I’d expect price impact from increased supply to be between negligible to low.
I’d expect value-add of new community members holding and using TRU (especially between current wallet holders to 2,500 holders - a critical number for certain partnerships we’re exploring) to be far in excess of the negative supply impact.
The 2,500 holder threshold represents a significant milestone in decentralization. I think that significantly outweighs any small dilution you get from offering this as an incentive for Sushiswap token holders. Especially given this limited-time opportunity for us to get new stakers on Sushi.
I am not clear on the value in new members having TRU beyond marketing. TRU is used for governance and loan approval. Sushiswap LPs getting it from farming incentives aren’t interested in either and would mostly sell or use the token for speculation. Perhaps there is data out there showing people who get TRU from LP farming are much more likely than I think to take an interest in the platform, but my expectation is most would sell and there are more effective ways to market the product.
A better metric would be unique wallets staking TUSD in the loan pool, because that is ultimately what drives the value of the platform. And as a side effect that would naturally grow the number of people holding TRU.
You’re right. Having more TUSD entering TFI-LP pool shall have a higher priority than promoting TRU token. The core business shall be the first Defi uncollateralised lending. TRU is just one of the tools to achieve it.
Based on comms with the Sushi team, I believe our most bang for buck in this partnership is going to be completely migrating incentives from Uni to Sushi.
We can give UNI LPs a similar 1 week heads up before migrating all incentives to SUSHI and aligning with their active DeFi community.
The company makes up a vast majority of the Uniswap Liquidity pool, I see no real value in continuing to incentive it. Especially when we have major CEX listings now and legit market-makers supporting us.
The primary draw to put TUSD into the TrueFi lending pool is (a) base APY and (b) TRU boost.
If we want to increase TUSD in the pool, I’d suggest the community (a) become more aggressive in demanding a higher loan APY from borrowers (absolutely fair considering the ROI available in the market). For (b), I am personally not for growing TRU incentives for TUSD lenders at this time.
Farming incentives (which come built-in with marketing to the community we’d support) are a fantastic way to get more eyes on the protocol (and specifically, the pool ROI), while more distinct wallet holders improve quality of partnership conversations.
Can you expand publicly on the content of the Sushi team conversation?
I’d be curious to openly discuss what’s being offered if we (i) do a 1:1 farm for Uniswap & Sushiswap vs (ii) migrate Uniswap incentives to Sushiswap, thus shutting off the Uniswap pool.
If we incentivize both farms (UNI+Sushi) they will not be as inclined to co-market this double dip yield opportunity.
Furthermore, the Sushi team is willing to incentivize a TFI-LP/TUSD pair on Sushiswap if we migrated 100% over.
This means that users would be able to pair TFI-LP/TUSD (interest bearing +trading fees), stake their SLP tokens and earn additional sushi rewards ontop of the interest generated by TFI-LP and Sushiswap trading fees.
This pool can serve as an alternative for occasions when liquid swap cannot offer best pricing in terms of TFI-LP redemption. Esp for smaller depositors that want to redeem TFI-LP early.
Hello community- I’m strongly against a 1:1 farm, which right now seems to be the most popular option.
Right now I believe the protocol is massively over-paying and getting very little in return. For example, the TFI-LP farm is paying 59% APY on $27mm of capital in the TFI-LP farm. This is a rate of ~$15.9mm per year and this ultimately comes out as reduced TRU token price as these TRU tokens hit the market. Are these LPs providing $15.9mm of value over the next year by putting their $27mm into the lending pool? I think not. Are they providing $1-3mm of value? Probably.
Here’s another way to think of it: if you lend me $27mm, and I pay you $15.9mm/year in interest, that’s what you’d call taking advantage of a sucker.
Note also that the protocol is experiencing severe inelasticity in the supply of capital. The APY on several of the farms actually increased significantly as TRU token price grew from ~12c to ~24c, but has this brought new capital into the protocol? Very little. Lending pool TVL has been close to flat between 30-35mm for a while now. I think our best bets for bringing new capital into the protocol are things like adding USDC support, not paying higher APY on the farms.
Trying to compete with the latest ultra-high APYs in DeFi is a fools errand and no serious protocol attempts to do this for a significant amount of time- it’s attempting to defy financial gravity. Serious protocols like Compound are paying reasonable interest rates on their farms and that’s what we should be targeting.
I see creating a new 1:1 farm as a way to pay even more and continue to get very little. We’re renting capital at extortionary rates, and for what? Why should we rent more?
I would be OK with migrating half of the rewards over, assuming we can also migrate a proportional amount of our corporate capital over and continue farming-and-burning TRU as we have been. This burning reduces TRU supply which ultimately benefits TRU holders. I think reducing TRU emissions would actually be better than a migration, but at least a migration would not make the situation worse by increasing emissions.
I agree with this and migrating half the rewards to the sushiswap is the best idea. We don’t need to compete with exorbitant rates as current rates of TFI-LP are enough to attract capital. For uniswap and sushiswap pool, it will only add to sell pressure since folks farming will sell immediately
I think the right way is to incentivize lending to TFI-LP pool which I created a post about. Incentizing sushiswap doesn’t add value to the project at all. Early on incentives for uniswap made sense to create liquidity, but we don’t need to keep adding this free token emission at the highest rate possible.
Well put. If there is a liquidity shortage, its in getting TFI-LP in the first place. USDC support would be very helpful. As someone who just recently put 10k into this, the doubled gas fees in converting USDC to TUSD then TUSD to TFI-LP were painful.
I think at the root of the disagreement here is “what are farming incentives for,” or at least which one are we optimizing around:
(A) decreasing slippage on DEXs (a service ideally attained at lowest cost)
(B) to grow # of individuals holding TRU (a service to them, ultimately enriching them, but also roping some portion of LPs into our community as active players).
What percentage of LPs ultimately hold the token is not known, but is roughly tied to their sense of the future promise of TrueFi - which I’d argue is fairly compelling, especially once the 2021 roadmap is published.
A suggestion by @Jacks with which I agree is a total migration of farming rewards from Uniswap to Sushiswap.
It allows us to meet BOTH priorities:
(A) Migrating the farm keeps total TRU farming outflows the same, therefore keeping TRU price from depressing at a faster rate. It would also expedite the setup of TFI-LP pools by winning us favor with their team.
(B) It would allow us to reach the new Sushiswap audience with a robust farming offer - further boosted by SUSHI awards on the Onsen, which would attract more attention considering the total APY would be high enough to compensate more of the impermanent loss.
Uniswap liquidity is already strong and with centralized listings is not be vital to trading nor price discovery. The farm has also run long enough that whatever audience we’d have reached on Uniswap has been tapped. Neither is the case for Sushiswap.
Furthermore, a full migration would definitely raise the marketing Sushiswap would put behind TrueFi. They’re huge in the DeFi degen community, who would be good partners to making TrueFi better.
I see your point. I think we as a community will be able to demand for a higher APY when we allow borrowers with a smaller amount as they probably has a lower bargaining power.
If your goal is to increase # of TRU holders, this is easily achieved through an airdrop, why make this more complex than it has to be? Just name the number of holders you want to have and we can make it so. An airdrop isn’t super attractive because it’s clear that we’re giving away TRU and potentially getting relatively little in return, a farm is a good way to disguise this fact by making the mechanism more complex.
To be clear I’m not advocating for killing the farms, just bringing their APYs closer to e.g. Compound’s farms.
I’d be OK with this full migration plan as long as we also move a significant chunk of corp capital over to Sushiswap so we can continue farming and burning. Otherwise the amount of TRU released into circulation will increase significantly compared with today and harm TRU price.
