Why: Current COMP distribution model heavily weighted towards allocating capital in one, most efficient way, namely DAI market and basically directing pretty much all of the distribution towards specific capital, interested in “farming”. Current implementation was a temporary solution intended to solve massive gamification of system happening at introduction. Currently system allows to just extract value, with little to no benefits in development of protocol.
How: Instead of dispersing all COMP at current system, i suggest decrease current distribution by 30 to 50% (for example let’s take 30%). So from current 2300 COMP per day, distribution under current mechanism will go to 1700 COMP per day.
Another 700 COMP per day i suggest to disperse in different way, on top of current system.
I propose to set individual parameter for each existing pool, which could be set/changed by governance, controlling how much COMP per block that particular market recieve as incentive. Inside of market same 50% supply/borrow mechanic remain, as it proved to work fine so far.
That distribution should happen on top of current distribution, allowing for governance to route incentives to stimulate usage of markets which community think appropriate and in amount which could be decided by governance, and which also could be changed in future.
As a conservative strategy i also suggest to set that parameters for reasonable amount of time like at least month, not like changing every week or so, for capital providers to be able to plan and adjust their strategies.
Currently, each market is weighted proportional to borrowing demand, but alternate approaches could be simpler, and more fair. Over the past few months, many projects have experimented with incentive design, and being able to customize incentives could be a valuable tool for the community.
One possible approach (which would require community development) would be to replace the current refreshCompSpeed() function (and flags for which markets are enabled for the COMP Distribution), with a setCompSpeed(market) function callable by Governance.
This is a very old Necro thread, discussing automatic distribution model which was there prior to current one.
Current model is completely “incentivised” and distribution is set individually for each market by governance, there are no more automatic adjustments based on borrowing size.
Raising old, irrelevant treads, rarely is productive action, and not in that case in particular. You should create your own with your idea of “halving”.
I don’t see much value in decreasing distribution, as it is actually one of the few ways of introducing decentralisation. Otherwise vast majority of voting power will stay in hands of VC. Besides, distribution per capital of liquidity is dropping fast naturally, as markets grow bigger and bigger thus, if you not grow your portion proportianally, your share of distribution becomes noticebly smaller every month already.
I hope somebody can lock this thread, as it’s just going to confuse people.
Compound has to find a way to reduce emissions while maintaining the distribution of COMP.
This can be done by adding features that have fees that must be paid using COMP. The collected fees will have to make up the difference for the reduction of emissions. This will enable the protocol to keep rewarding Compound users indefinitely. Once emissions run out, without a substitute, Compound will be known as a “one-hit wonder.”
It’s like 3+ years ahead which is like light years in cryptocurrency.
And it’s not really emission. It’s distribution. No new COMP are being created by distribution. There is some logic in what you say, distributions could be reduced in favor of extending it further down the road, depending on a market valuation. But probably not quite yet. As i already explained before, everybody already getting less COMP per unit of capital provided, because Compound grew so much and distribution stays same. (actually it was already reduced once.)
And idea of advocating of cutting distrubution faster is same as advocating that Compound should be completely controlled by Venture capital forever. That COMP, which is being distributed gives voting power to community. It’s not about giving away money, it’s about governance first and foremost. VC, currently owning vast majority of voting power aint going to give it away, the COMP available to buy on market is the COMP from distributions.