[Discussion] for an Ex-Parte Propsal to FIX Balancer Pool weights and STOP allowing governance to manipulate it

[background]
I bought 2k MTA @ $1.60 on technical analysis and confidence in the project from due diligence. My intention was to catch the bounce and buy into the 50/50 mta/musd pool with more MTA in order to offset future impermanent loss and capture rewards.

I decided to vest into the 95MTA/5mUSD pool in order to suffer minimal impermanent loss and facilitate simple pool to pool re-liquidation.

The price kept sinking and then I read that this naive community allowed governance to ruin the price (not value) of the MTA token due to how prices are established on defi protocols.

There are 3 balancer pools for MTA with rewards:
50/50 weth/musd (20k mta rewards)
5/95 mta/musd (15k rewards)
50/50 musd/usdc (10k rewards)

Excuse me but what the fud. If you incentivize the balancer pools with a 5:300 ratio to 245(musd+usdc) stable, 50 solid, and 5 LP rewards token, you are basically saying that the MTA proportional value is negligible (<2%).

Additionally, when people buy into the juicy 5MTA/95mUSD (negative risk, high reward), buyers who pay with MTA interest are continually selling 100MTA weight to buy into a 5MTA weight 95 MTA weight pool… removing risk (you earn 5%-10% mta/month so the 5% risk paired with 95% stable is less than 0). This is effectively selling 95% of the interest to buy mUSD and does nothing to help the community.


My proposal is to end the 15k rewards immediatly on the 5/95 pool and place them on the 95MTA/5mUSD pool for the same number of weeks that this fiasco has been damaging the price/value ratio of the MTA token.

Afterwards, end the 3 balancer pool rewards (45k) and put on a 20/20/20/20/20 MTA/mUSD/WETh/USDC/BAL pool. Yes… the same 4 coins as before but add the Balancer Protocol to the pool.

This will add the BALFACTOR (2x interest on the bal/weth bal/mta bal/mUSD and bal/mta pairs) and the pool will earn close to 80% BAL apy if the fee is near 0 (so like 0.05%… this also makes better liquidity) IN ADDITION to the 45k MTA rewards.

It also adds the ETHFACTOR to the weth pairs that did not exist before.

This gives the mStable community access to holding equal ratios with good rewards AND vote on the Balancer protocol too (pooled BAL can be used to vote). Furthermore, Balancer LPs who wish to sell BAL can buy into the 5x20 pool directly with their rewards.

It also simplifies the choice of “which pool” and stops daytraders from “pool hopping” … mStable should be… stable.

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Set a time frame on how long the 45k goes to the 5x20 pool so that there is a planned transition to move towards balancer liquidity of mASSET<>mASSET exchanges.

Ex-parte… quickly done, temporary.

There was already an earlier proposal to fix LM pools, but it did not get much attention: [Discussion] Consolidate existing liquidity pools

While I cannot speak to the prospect of the proposal to be successful (in stabilizing and ultimately increasing MTA price), I am in favor of giving it a try.

2 Likes

Well if everyone wants to bleed 30%/week that is their choice.

The easiest and most effective fix would be to END the rewards on the 5/95 and put them on the 50/50 and leave the other 50/50s alone.

Then we can talk about doing a 20/20/20/20/20 pool with mta.musd.weth.usdc.bal to EFFICIENTLY capture the balancer rewards and give the mta community a way to be an LP for both MTA/mUSD and BAL, and have governance at both.

Can you find me an example of such a duality pool right now that makes sense? could earn 80% balAPY + 1-2% feeAPY and target the mtaAPY to 70% for a totalAPY of CONSISTENT 150% apy (not accounting for underlying price change)

Since the mtaAPY may at times be significantly lower than staking the MTA, that should encourage staking MTA too.

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I agree with the proposal highlighted here:

The easiest and most effective fix would be to END the rewards on the 5/95 and put them on the 50/50 and leave the other 50/50s alone.

And would be willing to vote for this kind of structure. I can see how Ending the 5/95 rewards is the best way to solve some of the MTA tokenomics. A lot of community members are now waking up to the issues around MTA emissions.

You’ve got my vote here

I certainly would appreciate not having to check the incentive allocations constantly and pool hopping.

Is there a reason we are missing why a 4 or 5 asset Balancer pool wasn’t investigated originally?

Actually, if you really wanted this to be a quick and decisive vote, any one of us could simply create the Balancer pool right now, add liquidity and evangelize support for it in Discord.

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Well… But what? I think the best would be a 50:50 musd:mta with the 15k rewards from the 5:95 and commit to 90 days of not changing the rewards on that pool.

I didnt realize there is no 5050 mta.musd until 15 minutes ago :laughing:

I can set up the pool, but what… 50:50 mta:mUSD with 0.01% fees would be how I would do it. Yeah you make almost nothing on the fees but it is an LP pool for mStable with rewards… and the point is liquidity.

If I set up that pool, would there be interest in voting on moving the 15k rewards from the 5:95 pool to the new 50:50?

50:50 mta musd
50% MTA 50% mUSD
0.01% swap fee
$1,866.52 liquidity
Adj liq: $1,866.51
Annual BAL: 38
BAL-APY: 26.47%

I don’t think this pool really changes behaviour too much.

People enjoy 5% in a volatile asset and 95% in a stablecoin because of the smaller IL curve and exposure. I suspect many will simply bail entirely if forced to move to 50/50.

I thought the main thrust of this proposal is that if we make a 5-pool on Balancer including BAL and WETH the pool will attract additional Balancer bonuses, potentially back in triple digit APYs, and people will be happy to have the IL exposure because the gains are large enough to weather it.

Then you have no idea how defi pricing is established and why a $5.5m pool with $5,250,000-mUSD : $275,000-MTA is killing the price.

Weight1Ă—TokenSupply1 = Weight2Ă—TokenSupply2 and price only changes when orders execute.

The 95:5 weight on a pool tgat is 125% of the mta market cap is certainly going to drive the price to. <$0.30 as more traded occur… Especially the VC dilution and the selling.

Creating the 50:50 for you all was a gift from me for you to fix it. 0.01% fee… It is an LP rewards pool.

Removing rewards from 5:95 will leave that pool with 5% apy.

15k on the 50:50 will be over 104%.

This forces smart LPs to pool hop (and with a 90 day rewards guarantee before any changes on that pool, is better yet) and effectively sell 90/95 mUSD to MTA to make the 95mta:5musd LP pair.

So about $4.5m (2x mta mktCap) could move to the 50:50 rewards pool and adds the buy pressure back.

50:50 has 0 slippage and fair/high IL so rewards are justified.

Rewards on the 5:95 is inappropriate… No risk, easy rewards, dump pool.

End this topic and go to: