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[Transmuter] Rebalancing Incentive Design #8249

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iboss-ptk opened this issue May 10, 2024 — with Linear · 0 comments
Open

[Transmuter] Rebalancing Incentive Design #8249

iboss-ptk opened this issue May 10, 2024 — with Linear · 0 comments
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iboss-ptk commented May 10, 2024

The idea is to have a way for the asset that is closer to any limit or close to 0 has an incentive to reduce / increase its composition in the pool. That can be done in any means:

  • exit pool (aka. swap from alloyed) with limit reaching asset
  • join pool (aka. swap for alloyed) with other asset
  • swap from other underlying asset to the limit reaching one

@sunny :

Not just close to a limit, but also close to 0, to increase its composition in the pool.
As an example, let’s say that the allowed range of nBTC in the BTC alloy is 0 - 10%
That means it CANNOT go above 10% or below 0% (obv)
But we want to have a “target range” of say 3-7%
This means that above 7% it should charge fees if you move it farther away from 7%
But also below 3%, it should charge fees if you move it close to 3%
These fees should increase the further you are from the target range

example reference:

https://stargateprotocol.gitbook.io/stargate/v/user-docs/tokenomics/protocol-fees

Additionally, given that the actual risk comes from bridge/chain rather than the exact denom. having bridge/chain tags and having limits/caps for them would make more sense than specific denom caps as the actual risk coming from bridge/chain vulnerability rather than the specific denom itself.

@iboss-ptk iboss-ptk changed the title [Transmuter] Rebalancing Incentive [Transmuter] Rebalancing Incentive Design Jul 29, 2024
@iboss-ptk iboss-ptk self-assigned this Oct 21, 2024
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