Proposal to extend stakedrop rewards for an additional 4 months

By request I’m presenting a new proposal to extend staking rewards. Previously accepted proposal to halt stakedrop rewards by the end of November 2021 was created as an effort to preserve KEEP for bootstraping of v2. At the time of the proposal, tBTC v2 was expected to launch in October/November and there was no planned merged with NuCypher, nor was there plans for a Threshold Network DAO with inflation parameters.

Because of these reasons, the previously accepted proposal has become moot. Rewards (inflation) will now be controlled by the Threshold DAO so there is no lack of funds for bootstrapping. Furthermore, since tBTC v2 is expected in Q1 2022 and because integrations are already being made for v2 with 100% backing by tBTC v1 it’s important to maintain tBTC v1 for now.

The original proposal was 10 million keep distributed in the last month (November). This large reward in the last month was made to “help the last men standing exit without significant loss”.

I assume most stakers have been planning to dwindle down operations come end of November, but ideally we’d keep them hanging on for a while longer. There’s no strong incentive to leave right now, but there will be by the end of November, so we need to act quick.

In this proposal I suggest we implement 4 extra months of rewards (December 2021 → March 2022)

The reward amount is a total of 3 million KEEP to be distributed over these 4 months. It’s not a large amount, but for nodes already staked the cost of continuing to stake for an additional 4 months is negligible (and more-so as the coverage pool comes into action and de-risks their positions).

I suggest a repeat of the previous proposal reasoning on a smaller scale, in order to incentivize node operators to stake until March we’ll give the largest reward at the end.

Proposed reward schedule:

Month Stakedrop rewards (KEEP)
Dec-21 500,000
Jan-22 750,000
Feb-22 750,000
Mar-22 1,000,000

I suggest we vote on this asap.

TL;DR: tBTC v2 token is currently backed by tBTC v1. Launch of v2 is expected in Q1 2022, but there’s no stakedrop rewards after November. I suggest we extend rewards until March 2022 to incentivize current stakers in keeping their nodes running until then.

6 Likes

Thanks Agoristen, I’m all in.

I support this proposal.

This looks good to me.

I’d like to discuss only extending this on a month to month basis. If v2 is ready by end of November, nodes could essentially just make free rewards for the next 3 months for doing nothing.

If the dao can vote these rewards easily, we can just approve the next month’s rewards. This would also give a clearer picture on what to reward for the next month, as timelines change day to day.

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To lock in the token factors for wrapping to T we need to finalise the stakedrop numbers for KEEP.

The last operators out will most likely take some economic loss from unrecoverable ETH due to TBTC dust being left in wallets.

Having tapered rewards until the end avoids a race to the exits to avoid those loses. A graceful wind down of TBTC v1 would avoid artificially skewing the price of acquiring TBTC to free up the ETH.

4 Likes

That makes sense. Thanks for the clarification on that.

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Thanks for this proposal @Agoristen. Considering the capital you sacrificed in supporting the early protocol, it’s a testament not only to you but the project that you stay so involved and lend your expertise to helping evolve.

I support this and will be ready for a vote hopefully soon.

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Also in support of this proposal, thanks for detailing this out.

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Thanks @Agoristen for the proposal.
I would support this proposal !

Passed unanimously on 10/25 with 6 multi-sig votes.