Proposal to utilize the Uniswap v3 staker for ongoing staking rewards and deprecating rewards on the current G-UNI pools for the upcoming extended LM reward period.
The Instadapp team is proposing changing the current staking contracts for ETH/INST staking. The current G-UNI token contract was very helpful at establishing our initial liquidity, however there are some aspects of this pool we think could be improved. The Uniswap v3 staker contract will allow users to manage their own price range and ticks; and will accept any NFT position in the ETH/INST Uniswap v3 market. This will improve overall liquidity, allow for better price discovery and create a more competitive LP environment.
G-UNI rewards have been extended on September 15th through IGP#4
We propose that the allocated 1m rewards be redirected:
- 250k INST to the new Uniswap v3 Staker contract
- 750k INST reserved for upcoming liquidity incentives with other AMMs such as Bancor, Sushiswap, etc with the ability for the DAO to return any unused tokens back to the treasury by the end of the LM extension (January 15th, 2021)
The current G-UNI set up is managed by the team; this requires consistent input from the team to manage price ticks and price ranges. There is a price wall that is created with the G-UNI contracts; prices stay relatively stable but falling outside the set price range creates a liquidity shortage forcing the team to respond and bring the G-UNI price range into the new price. We think this sort of scenario is not ideal for the team or token price.
The Uniswap v3 Staker contract is built directly on Uniswap v3 meaning any INST/ETH pool provider can participate in INST rewards; this should make it easier for integrations and external DApps to distribute INST rewards through their interfaces. (i.e. Zapper and Zerion) This will also create competition for INST/ETH liquidity and will create the conditions for better price discovery.
At token launch, we launched with two pools; one pool has stayed relatively close to the lower bound of the price tick and it has functionally operated as a pure staking contract which was not its intended purpose; shifting to Uniswap v3 Staker contract will allow for better utilization of reward incentives.
Uniswap v3 Staker Repo: https://github.com/Uniswap/uniswap-v3-staker
Uniswap v3 Staking Connector: https://github.com/Instadapp/dsa-connectors/pull/70
Uniswap v3 Resolver: https://github.com/Instadapp/dsa-resolvers/pull/8
Uniswap Staking Contracts Docs: Uniswap V3 Staker Design | Uniswap
This proposal would deprecate the G-UNI staking INST rewards in the upcoming LM extension and instead allocate 250k tokens to the new Uniswap v3 staker contract. This staking contract will enable users to better manage their own Uniswap v3 NFTs while also gaining INST rewards and will allow for better price discovery of INST.
750k tokens of the deprecated G-UNI rewards will be allocated to upcoming and future AMMs as liquidity mining incentives with the DAO Treasury recovering any unused funds at the end of the extended LM reward period.