Happy to see this proposal. I’d like to suggest some changes.
First, are we going to have enough time to discuss and vote before August 1st? Seems like the 12 months should just be from the day the vote passes to a year later (no advantage to pre-specifying the exact dates).
Just yesterday I posted in Marinade’s Discord about changing how token locking works.
How would people feel about switching MNDE’s locking method to something more similar to Lifinity’s?
The Realms migration proposal already mentioned that “Marinade will be able to benefit from the veMNDE locking system, and add support for variable lock times, such as giving more voting power to those who lock longer in the future.”
The particular features I would recommend are:
・Extend the max lock period to 1 year
・Voting power is directly proportional to veMNDE balances
・veMNDE stays locked until you tell it to start unlocking
・While unlocking, locked MNDE is unlocked linearly and veMNDE balances decrease linearly
・Max (1 year) locked veMNDE can be converted into xMNDE (its tokenized version) and vice versa
・Create a constant product xMNDE-MNDE pool with a 1% fee
・Use a portion of the treasury’s MNDE to provide liquidity in the poolRationale:
・More voting power for those who lock longer means that those who are more committed to the protocol have a greater say in its governance
・Unlocking tokens linearly rather than all at once at the end (like Curve and Saber) as well as enabling the tokenization and trading of veMNDE increases the willingness of people to lock MNDE and hold veMNDE positions
・Providing xMNDE-MNDE liquidity provides utility to token holders while capturing fees – essentially a form of costless buybacks since IL is not really a risk in this type of pool from the perspective of Marinade as a liquidity provider
My proposed locking method above would enable users to choose their lock period when claiming their MNDE rewards from this incentive campaign and be rewarded accordingly. Those who choose to lock for the longest period (say 1 year) would receive the proposal’s suggested 4 MNDE per SOL. Those who choose a lock period of 0 days would receive, say, 1 MNDE. The MNDE rewards for any intermediate lock period can be linearly interpolated (e.g. for a 1 month lock period it would be 1+(4-1)*(30/365) = 1.25 MNDE).
The practical effect this will have is that Marinade will be able to better differentiate between long-term and short-term holders. Those who plan to sell will be more likely to choose a shorter lock period, while those who actually plan to use their MNDE by voting with it will be locking it anyways so they will choose to lock it (likely max lock it, to maximize voting power). Importantly, this only has the potential to reduce the total amount of MNDE emitted (same amount if everyone max locks, less if some people don’t), and will thus use the treasury’s MNDE more efficiently.
A concern I have with implementing the proposal without first making these changes is that it may then become difficult to make these changes for a whole year because it could interfere with the incentive campaign. So ideally the locking method could be changed first or together with this proposal.