Buying $SBR & $SUNNY with treasury to boost MSOL/SOL pool rewards

What if we use Marinade Treasury to buy $SRB and $SUNNY and vote on their DAO (Gauges) to maximize rewards on MSOL/SOL pools on these platforms. Currently MSOL/SOL pool on Saber is at 80 Million TVL and SUNNY at 75 Million. Just under MSOL pool is the Lido pool stSOL/SOL with 57 million TVL, i think being the biggest liquid staked SOL pool on Saber is very important.

Higher rewards will incentivize more people to LP MSOL/SOL pool and move from stSOL/SOL pool to MSOL/SOL

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I like this idea. To me it makes much sense for the MarinadeDAO to participate in the Saber/Sunny governance.

Additionally, Saber is a great team and has been supporting decentralization and securing the network with Marinade since the start which I think is worth noting.

That way, we can position ourselves as you write in your suggestion + knowingly participate in further decentralization efforts together with Saber!

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I also like this idea but I’m not sure how effective this is.
Can we estimate if how much we buy SBR/SUNNY, how much APR% of mSOL pools will be increased ?

well it doesn’t matter how effective it is or not, if lido, socean or other staking services start doing that, we have to do that whether we want to do or not.
In that sense, we should do that before others start (they already started ? ).

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Hello. I like the idea for several reasons:

  • It follows what’s happening in Solana DeFI
  • It builds on success on Curve and often, replicating the successful ideas just works
  • It’s publically discussed on a forum, enabling everyone to provide opinion and reasoning with the single purpose to find what’s best for Marinade

Let’s add some hard-boiled facts:

  • Saber is the second or third biggest DEX on Solana (Serum, Raydium), with mSOL/SOL doing 20-25% of Saber’s daily volume [Defilama, Saber.markets]
  • 1/3 of SBR supply locked
  • Marinade does not have a DAO governance module online (yet)

Mix with strategy:

  • Marinade wants deep liquidity in mSOL/SOL pool and already incentivizes such pools on Saber, Orca, and Mercurial, with Saber and Mercurial being the most effective on Jupiter

And some sweet game theory:

  • Currently, voting is only strategic. The large voters (Saber+ Sunny, speculation, fact-check me pls) push rewards onto the strategic pools with Cash and similar, to push own projects into spotlight. There’s nothing wrong with that, but it happens easily, because non-strategic voters are only incentivized to vote for pools where they provide liquidity to farm better, instead of voting for the best performing pools.
  • This will change, because Saber wants to introduce sharing the fees with veSBR holders. So it’s in the profit seeking veSBR votes will be incetivizied to vote for the best performing pools Discussion: Add an Admin fee to be distributed to veSBR holders - Governance - Saber Research Forum

Serve with the options:

  1. Do nothing.
  2. As a defensive action, Marinade can incentivize LPs to switch to different pools where gauges do not exist OR exist in a form where there are not as few strategic voters and small voters are incentivized to vote for own biggest profit.
  3. As an offensive action, Marinade can start acquiring a strategic stake in SBR. Estimates: to acquire 2% voting power and corresponding alloc in a hostile environment where no one else votes for mSOL, ~5M SBR is needed, which will be constantly diluted by new SBR rewards.
  4. As an offensive action, Marinade can choose to incentivize the current voters to vote for mSOL pool themselves, but since bribing systems are yet not online, it would need to build one itself. So this is effectively 1. in the short term.
  5. combination of 3+4

Eat with reasoning:

  • DEX space on Solana with Orca v2 and Lifinity coming online in Q1 might look different, so the bet on Saber (4.) seems speculative due to being early.
  • Betting on Saber over early sending a signal to other dexes of Marinade making a strategic choice early. While mSOL/SOL pool on saber is indeed important, other dexes lead in stables liquidity and volume. Marinade cannot be in the (strategic) bed with everyone as it does not possess infinite resources.

Conclude and pay the bill:

  • I suggest waiting with the purchase and monitoring the situation closely. We can reach and educate veSBR voters to vote for the pools with the most volume to get the most fees before the fees share comes online.
  • We can simulate this behavior in bribing votes with some MNDE once bribes come online.
  • In the short term, Marinade can actually divert some MNDE incentives to other dexes to inctivize the liquidity to move to a more predictable environment and to send a signal to veSBR voters that it watches the situation.

What do you think?

4 Likes

We could also provide liquidity (with Marinade Treasury) on MSOL/SOL pool on sunny.ag and farm $SUNNY and $SBR at the same time, we keep adding liquidity to this pool with treasury funds every week or so, so we keep accumulating more and more $SUNNY and $SBR.
After each gauge period, we claim farmed $SUNNY and $SBR and vote on MSOL/SOL pool to increase rewards.
Doing this, we provide liquidity to our pool and accumulate $SUNNY and $SBR with near zero risk, we get all the $SUNNY and $SBR and keep our treasury untouched. And if in the future Saber wars fail or whatever happens we take out liquidity and decide what to do next.

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And how about borrow some SBR every time the vote takes a place on Port/Solend/Larix/…

To be able to vote you need to stake $SBR and $SUNNY for veSBR and veSUNNY. Staking is at least 5 days and 5 year max, the longer you stake more voting power you have.

5 days wont be sufficient for this?

This is still within the angle of HOW should Marinade participate. I tried to provide a look on WHY should Marinade participate or don’t. Without resolving the strategic why, the how seems like a tactical problem.

Going after the merit of the suggestion - is this going to provide more profit and/or influence over providing the same funds to own unstake pool?

I would prefer marinade have the largest pool, and focus on driving traffic through something that we control.

Is there a rush to win the Saber Wars, or can we just observe how successfully it works for other protocols for a few rounds before we make our move?

I think it would only be natural for Marinade, as the very first liquid staking protocol of its kind built on Solana, to have a presence and voting power in Saber governance.

As @c2yptic pointed out, Saber also has a track record of supporting decentralization and securing the network.

I don’t necessarily think that we should be in any rush to do this, but I do believe that having a seat at the table is important.

BTW, as of today, the Saber mSOL-SOL LP pool is receiving 0 SBR/day in rewards. If we want to change that, it looks like we have no choice but to get involved and swing some votes around.

Maybe mDAO views other protocols as more strategic, and that’s cool too. Would love to discuss further.

Also sharing some great resources on the topic below:

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It’s possible the barrier to entry will change. The treasuries that are pushing the gauges up need to keep funding to compete for the top spot.

I would like to see some analytics from both sides as to how effective this model is for the treasury, and keeping the investors sticky.

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agreed. the more data we have access to, the better the decisions we can make!

I think this topic might get a revisit with a twist. Since Marinade could spin up it’s own liquidity mining gauges, the natural approach would be to propose to Saber DAO to exchange a part of SBR for part of MNDE - since both sides will be interested to vote in each other gouges.

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Hello everyone,

The liquidity mining gauges proposal that @gekonn mentioned is now live.

There hasn’t been much discussion here. Pinging @Admiral, as the thread creator, to see if they feel the topic is still relevant (any other participants are welcome to comment as well). Otherwise we’ll archive this thread in a few days.

Looks like TVL in these pools has come down substantially, but at current price levels, I suppose it could be worth revisiting this idea. More voting power - that’s for sure.

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Can you elaborate on why it is worth it?

I think the concentrated liquidity is taking the lead on the mSOL-SOL pair: volume on Orca’s whirlpool is higher than Saber’s with 20% of TVL. While the pool is smaller, perhaps having an ability to slow unstake in one epoch directly from Marinade is good enough for large positions and it makes sense optimizing for tighter spreads.

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Valid point here for sure!

To be clear, I wasn’t suggesting it definitely is worth it, just saying it could be worth revisiting the conversation in case the original proposer still feels strongly. Doesn’t appear to be the case.

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