Bootstrap NECC/NDOL LP bonds

[ericjuta]

No necc trisolaris lp pool yet
System isn't fully functioning yet without this from a game theory perspective
Need to code the contracts to have a compatible boolean path again with necc 9 token decimal valuation first though

Currently the btc pool is empty despite there being zero mint fees due to it being way below target weighing lol, also an education problem tbf as well as people panic exiting immediately when liquidity is added.

I'm thinking of adding 100k NDOL/NECC LP to the trisolaris pool, any more would mean dumping rather than getting people to LP bond imo.
Plus making it a slightly lower bcv than the nNECC LP bond
Also maybe burning 1k nNECC and corresponding NECC (against current index) to progressively reduce staked percentage from initial minted funds as that's about the current circulating bonded amount or just pairing it with protocol fees to form NECC/NDOL LP tokens for bonding and aiding liquidity depth. Prefer the latter tbh

Anyways that NDOL needs to come from somewhere, either

• we incur permanent debt from the bonding treasury (currently has 4M yay) or
• we mint from BTC accrued from protocol fees.

Lemme know extra thoughts.

[diamondcockdao]

i like, but also there are many whales with eyes on this protocol ready to slurp panic sellers now

[diamondcockdao]

but perhaps i am thinking too simple and fickle. woe is the mind who cannot do math and fully scope out the game theory. necccccccccccccccc

[magmac12]

I am all for the second proposal: burning 1k nNECC and corresponding NECC.

Maybe the funds can be supplied via a combo of accrued BTC fees and permanent debt.

[JD09nft]

Definitely need to make NDOL/NECC the dominant LP, so that stakers see the value of holding nNecc

[diddydk]

Eric, we discussed this today in the discord.

At this point nNECC / NDOL is the main trading pair and I think it's hurting the protocol. Why? Suppose the nNECC / NDOL price remains flat for a week and in the meantime nNECC has grown 5% vs NECC due to rebases. The only thing the rebasing has achieved is devaluing NECC, because the trading happens against nNECC. This basically makes rebasing and the APY pointless as its sole purpose is to inflate and therefore devalue NECC.

The whole idea of rebasing is that stakers are rewarded with a higher amount of the traded currency. You buy the traded currency, stake to get more of that and at some point potentially sell more of that same traded currency. Right now, nNECC stakers keep the same of the traded currency (nNECC) while NECC slowly loses value.

From a psychological perspective, as an investor to stake a token and visually see the traded currency accumulate incentivises holding, instead of always having the same amount of the traded currency (as it is now). Furthermore, adding the (albeit minor) burden of unstaking before selling incentivises holding too, even just a little bit.

Therefore, I agree with this proposal and would like to add to it: I feel we should not only add liquidity to NECC / NDOL but also (slowly/gradually) migrate liquidity from nNECC / NDOL to NECC / NDOL asap, if technically possible. Liquidity of nNECC / NDOL should eventually be removed and trading of that pair stopped. Furthermore, in every type of communication outside of the protocol the price should be quoted in NECC, not in nNECC (on CoinGecko I see that only nNECC is added in preview mode).

[ericjuta]

following up on the discord conversation we just had
since nNECC is gOHM, we want gOHM to be the forefront token with composeability
nNECC can be used as yield bearing collateral for perps, lp bonds etc.

What we can do overtime is use protocol fees to mint ndol and unstake progressively the initial minted nNECC to form the NECC/NDOL LP tokens and bond to redistribute apy for current nNECC holders.

[diddydk]

thanks for your reply!

that second part sounds really interesting. great way to add NECC/NDOL liquidity, besides incentivisation through lower bcv as you mentioned in the discord. curious to see how it will play out!

[NotNarNar]

“I'm thinking of adding 100k NDOL/NECC LP to the trisolaris pool”

-does this involve taking nnecc from the treasury and then unstaking it for necc?

“just pairing it with protocol fees to form NECC/NDOL LP tokens for bonding and aiding liquidity depth.”

-this sounds good

“mint from BTC accrued from protocol fees.
Lemme know extra thoughts.”

-I think this is good

So the plan would be:

1. Take nNecc from the treasury
2. Unstake for necc
3. Take protocol fees, swap all fee assets for BTC
4. Mint ndol with the BTC
5. Pair the ndol with the unstaked necc, and create a new lp on tri
6. Then create a new bond for necc/ndol

I think this is pretty good.

Since the necc from bonds auto stakes it might be confusing. Maybe the necc should have to be manually staked or just have two buttons one for claiming necc and one for claiming and staking.

Is the idea of this to arb the the nNecc since it’s value is so detached from necc?

Maybe the default mint option for the ndol should be automatically defaulted to the asset with the best rate. That way people land on the page, they see BTC is default and they just go swap for BTC before minting. I think most people have no idea you can mint with anything other than ETH. That or just have BTC default at all times, as it’s the number 1 crypto assets and there is no second best crypto asset.

[satojandro]

Great initiative and very much needed indeed. I've been raking my brain over the last few days trying to understand why we have an nNecc pool instead of Necc. Glad to see that there is consensus in the need to create the necc pool.

As always, I believe timing is of the essence. Hence, I strong believe that, not only do we need to create a necc/NDOL pool, but we also need to phase out the nNecc/NDOL pools. Considering the treasury must have a decent amount of nNecc/NDOL LP tokens received from LP bonding, I propose:

1. We create a necc/NDOL trading pool on Trisolaris immediately
2. We seed the new necc/NDOL pool with the unstaked version of the current nNEcc/NDOL LP (Withdraw from trislaris, unstake nNEcc, add back to trisolaris on necc/NDOL pair). This step is particularly important to set the initial price.
3. Disable nNecc/NDOL bonds immediately. If there is a transition period in between the disabling on nEcc/NDOL and the enabling on necc/NDOL, pure NDOL bonds will suffice (now that debt ceiling isn't an immediate issue).
4. Create necc/NDOL LP bonds ASAP

Once the above has been completed, I agree with the approach of using protocol fees to issue NDOL and pairing that up with the unstaked nNecc from treasury. However, do kindly note that I would prefer this to be a mechanism of last resort as:

1. Trading fees should continue to be deposited directly into ETH/NEAR pools to help re-establish the peg
2. All unbacked necc and nNecc from treasury should eventually get burned. It seems to be placing an undue burden on people who did deposit funds into the treasury in exchange for necc and severely diluting rewards from existing nNecc holders (please correct me if my understanding of the impact of 125k artificial gloat of necc is... seems to me like we will have to accrue 125k worth of fees just to start breaking even unless we burn most of it).

Better done than perfect - by when should we aim to have at least point 1 - 4 above implemented? From a communications point of view, that's where community members such as myself and other engaged ones can step in. I agree we need to do more to help people understand how platform works and how to optimise their strategies.