With the sunToken standard (About sunTokens | Sunny Aggregator Docs), another protocol could create a liquid staking derivative of max locked ve-MNDE which would alleviate the user from having to commit for such a long time (assuming sufficient liquidity for trading in & out).
From the point of view of the protocol, it would be beneficial to have as much max locked MNDE in governance as possible (ie. for a longer time horizon then 30d), as a reduced liquid supply of MNDE makes numba go up.
Hey Everyone - A little late to this discussion but have read through everyone’s posts and response so I feel I’m up to speed on the current thoughts (well the thoughts of people in this thread).
Here’s my two cents for whatever its worth:
Time-locked MNDE providing greater voting power with or without depreciation over time will likely lead to a similar fate of CRV/CXV over on Ethereum and SBR/SUNNY here on Solana (and seemingly ever new DeFi project). There’s no value in creating artificial complexity by leaving the door open for another protocol to simply gamify the governance of Marinade. The mission is pure and the economics are still good, no reason to muddy the waters with anything unnecessary imo.
Taking this into account, and in hopes of possible turning a new leaf for governance in general, why don’t we consider flipping the concept of vote escrowed tokens on its head. Rather than offering 1, 2, 5, year lock up period for MNDE or the NFT version(which is essential our own form of vote escrowed) we instead create a mechanism that increases the voting power of each NFT overtime the longer that it remains in its current form (i.e. doesn’t get redeemed for the underlying MNDE).
I believe this could be a solution to the “whale influence” conundrum by offering the same increase rate for the smallest chefs to the largest (the impact would obviously be relative but the multiple would be the same). This way, someone who stakes MNDE receives their NFT, and similar to the way that mSOL’s value increases as validator rewards are claimed, the voting ability of someone who mints in 2022 at 1,000 MNDE might have the voting power of 2000 MNDE by the end of the year. This doesn’t mean distributing an extra 1000 liquid MNDE.
In my mind this would reward those who are invested in the long-term and want to actively participate in the governance of Marinade without simply diluting MNDE supply by pushing out more tokens or creating a “claim & dump” dynamic. I’m not sure the technical requirements of increasing the power of a NFT’s voting rights over time but if it’s not that challenging it could be an interesting solution and definitely something that could get peoples attention - the right people at least.
To my knowledge I don’t think anyone is doing something quite like this but correct me if I’m wrong. Very interested in hearing people’s thoughts on this idea. Excited about this project and the community supporting it.
I am undecided on vote locking mechanisms generally but believe it is way too soon for Marinade to move towards implementing one. Marinade has many critical governance processes ongoing (token auction and exchange, NFT launch, stake gauge voting, etc.). The community should be focused on these necessary and urgent tasks.
Vote locking with multi-year periods is an irreversible decision and requires deep consideration. Even Convex introduced it less than 12 months ago and it’s impacts are still evolving. Marinade is far too dynamic and important to gamble on new governance mechanics like vote locking.
The implicit goal of many vote-locking proponents is pumping the token price. I believe MNDE’s price would be much better served by demonstrating clear utility via validator gauges, mSOL growth and effective governance. Until we have exhausted those avenues, vote locking should wait.
Agreed, simplicity matters. In a sense, it’s one of the most ‘fair’ things we can do.
Love this, voting power increasing over time rewards ‘compounding NFT’ holders who are in it for the long term.
Also, the whole notion of “locked” CRV is defunct considering the existence of veCRV liquidity pools that allow you to swap out of “locked” tokens. To be fair, the same thing would apply to the 'compounding NFT" concept…unless we think of something.
I also appreciate how the 'compounding NFT" concept doesn’t inflate $mnde token supply, however, it would dilute the governance power of $mnde (as long as the NFT isn’t redeemed) which is very similar to inflating $mnde token supply, but in a more round about way and with less direct sell pressure.
Correct me if I’m wrong, but I think it would be v interesting if the ‘compounding NFTs’ were only redeemable for the the original $mnde deposited.
Yeah veCRV and the tradability of the NFTs act in a very similar way. I agree too the NFT should be redeemable for the same amount but the voting power increases on it’s own. Could either keep it simple where the staking contract that the NFT would be in is where the increase power accrues or it could accrue to the specific NFT which would still redeem for ex. 1000mnde but the voting power is higher than that possibly giving it a premium on secondary markets (this might be too complicated and kinda defeat the purpose all together).
Since people are concerned about MNDE dilution if we give more out to NFT holders, which I agree with by the way. Maybe using a royalty fee and paying people in MSOL or SOL, even if very small, would be a really great way to get people interested in locking their MNDE with us.
Not everyone cares about voting, most are looking to profit and invest in a good project. Giving a reward that doesn’t devalue our token is a win/win.
We already have deployed a mechanism to “grow” our NFTs. If we feed them more MNDE, they will grow and transform itself into a larger Octopus.
Perhaps instead of a traditional lock, we could use this mechanism to gamefy the lock process and reward NFT holders with emissions and more voting power (all at once). Instead of calling it a lock, we would say we send our octopus (or sharks, or crabs) to a Sea Farm Resort. There the Octopus would eat MNDE daily and grow slowly. As it grows, it is rewarding holders and increasing their voting power at once.
But I think 5 years is too long. I prefer liquid staking.
I also like the idea of additional incentive in mSol. The royalty fee sounds like a good idea. NFTs are sold in Sol, we could use the fee to stake Sol into mSol and give it back half to DAO treasury and half to holders.
For contributors proposing longer lock-ups or rewards to stakers, can you include the objective of the program you are advocating for? Tokenomics can become quite technical but the objective of any specific program should be straightforward imo.
IMO a “lock up” for governance purposes limits the risk of self-interested parties being able to have too much influence and then selling their positions. I want to take a deeper look at the current distribution of MNDE today to see if that’s even a real threat (another thing on my to do list).
As it relates to rewards, I’m not the biggest fan of this component of crypto but understand why it exists. Since MNDE is not a security, you need an alternative way to benefit those supporting the platform. From a strategy POV it’s a solid tool for gaining utility and partnerships. I believe Marinade has done this extremely well based on the level of integration that mSOL has had thus far.
Big fan of Cobie’s piece though, paradigm shifting thoughts in there. I don’t believe that 2, 3 years from now protocols will be relying on expensive token emission schemes to grow DAUs/TVL.
Thank you for sharing @brian_smith_0! Cobie always tells it like it is. Clearly you do too, and I love it.
To respond to your question on the objective of the program I was advocating for above (more MNDE rewards for early governance participants), here’s how I see it:
The objective is simple - provide an incentive for people to actively participate in governance at an early stage and reward those who do so with incremental voting power
The fundamental difference between MNDE and APE in my opinion is true utility. The voting power associated with locked MNDE tokens can directly influence and drive economic outcomes for validators, whereas APE’s utility is questionable at best
The MNDE locker rewards (governance staking if you will??) system therefore has a purpose - to acquire more voting power and gain more control over the distribution of staked SOL without introducing unnecessary complexity/gamification. Very different from “idk we give you more coins as a reward if you don’t sell your current coins lol”
I am operating under the assumption that the team will be putting forward this proposal as outlined in their blog post
I think that doing so is a good idea, but in light of these observations, and knowing that (without economic incentives) most protocols struggle with voter apathy, I would even suggest that the team consider modifying the plans a bit. Maybe distributing extra MNDE rewards to those who lock AND vote rather than just lock tokens alone is the right approach? What do you think?
I like the idea of being able to choose longer lockup period within the NFT than 30 days to get more voting power.
I don’t like the idea of incentivizing this with more emissions/revshare/rewards to NFT holders though. I think that possibly causes a conflict with incentives - should the incentive to lockup be to get more yield, or should it be an indication to have more say in the Marinade kitchen? I don’t see a clear match between those two.
Additionally, the NFT’s are still liquid and can be sold on secondary markets, no matter lockup period? Then the market would price in voting power value? (ex gauges etc)
If everyone, no matter lockup time, would get the same ‘rewards’ it would still mitigate voting power decay? Not sure, but that is how I see it for the moment
The question is whether you benefit more from holding MNDE instead of locking it up. You can acquire more by adding your tokens to a liquidity pool, but not by much to be fair, and you can’t vote with them. I would like to see MNDE appreciate in value, but emitting to NFT holders probably won’t do that.
A longer lockup for more voting power would be nice. It would benefit holders with a long-term view. Of course, you could argue this would give an unfair advantage to organization with deep coffers and no incentive to sell, but on the other hand it would also encourage smaller holders to hold longer. And of course you can sell these anytime so they could be more valuable to buy than NFTs with a shorter lockup.
Thanks for jumping in, @octo - I meant to bump this topic today.
I think @c2yptic’s point is not that issuing MNDE to NFT holders would cause it MNDE to increase in value, merely that it would help stall the value dilution that is likely to take place during the time the NFT is locked (because of issuance through processes like liquidity mining)
I do think that it would be good to encourage long-term locking. Personally, I’m currently more inclined for the approach of periodically adding MNDE to the NFT, given that:
This will have the net effect of a voting power increase (albeit gradually), and
It would help counteract dilution through issuance.
Otherwise I’m not sure if I’d personally value the extra voting power that much over the flexibility of selling within 30 day notice, not to mention a potential dilution I can’t plan for.
Think of it this way: after a year, you not only enjoyed increased voting power, but you end up with more MNDE than you started with.
I would be very happy seeing my NFTs appreciate in MNDE value, be it by MNDE emissions or increase in MNDE locked. Not only for the voting power and the increased monetary value but also because it’s delightful to upgrade them purely for aestetic reasons.
On reflection, it would make sense to emit enough to stall the value dilution as you point out.