This proposal is to add co-incentive for sUSD bridging from/to Optimism and Ethereum Mainnet.
The Synthetix Treasury Council has signaled to incentivize sUSD/hsUSD LPs with $5k worth of $OP monthly.
This proposal extends HIP-5 to add co-incentives to sUSD pool, and adjust the rewards for the SNX pool to a $5k worth of $OP monthly
Rationale
As original HIP-5 does not specify for hsUSD/sUSD co-incentive yet. This proposal proposes a co-incentive for the sUSD pool with Synthetix Treasury Council which has signaled to post $5k worth of $OP.
Furthermore, to ensure that both of these rewards are the same the SNX co-incentive will be adjusted to $5k worth of $OP monthly.
Specification
Incentivize liquidity for hsUSD/sUSD with $5k of $OP monthly with a matching $HOP incentive.
Incentivize liquidity for hSNX/SNX with $5k of $OP monthly with a matching $HOP incentive.
Just for some context on myself, Iām Matt, the comms lead and one of the ambassadors at Synthetix. Iām posting this to ensure that Synthetix and Hop can work together and set up these incentives that are greatly needed to ensure people can move from OP and L1 at scale.
Excited to see this integration go live. Thanks folks!
Hi Matt - thanks for bringing this proposal to the forum.
While Syntehtix has been a luminary in DeFi protocols, we do not support this proposal. It feels like the community needs more context before going to a vote.
Synthetix received 9,000,000 OP via Optimism GF Phase 0 to be distributed; one-third of which is earmarked to dedicate towards bridging incentives. This grant was 9x the size of Hopās OP request.
We are happy to support but do not advise Hop co-matching and further diluting its token. If the team desires, it can co-match incentives via $OP - but this has been allocated towards onboarding initiatives.
Lastly, if the Synthetix team hopes to establish monthly incentives, it feels best to denominate the amount in OP tokens vs. USD. This way the community can better understand your investment.
Just for a bit of context here, the original proposal for co-incentives and such came from Millie here which then passed a subsequent vote in HIP 5.
The issue with the proposal is that it didnāt include a set amount of rewards, which caused the OP and HOP rewards to get a bit of wack. This change was requested by some of the folks on the HOP side, so changing this makes it a bit easier for the current incentives.
The proposal also only set rewards up for SNX, but nothing for sUSD, which is a critical miss given the massive amount of usage of sUSD on Optimism. For some further context, sUSD is most used stablecoin across the Synthetix Ecosystem, which is the largest ecosystem on Optimism for DeFi users. Its critical that this stablecoin is supported and that people can move from L1 to L2 at scale.
Iām more than happy to walk through any other questions or anything, and Iāll wait on a vote for a bit longer on this one. But overall, Iād like to say that working with Hop on coincentives is really fruitful up to this point and has helped Synthetix and its deep ecosystem onboard many users. SNX incentives are great, and they do help, but sUSD onboards many more users than just Synthetix users, it onboard users from Synthetix, Kwenta, Lyra, Thales, Polynomial, dHEDGE, and so on and so forth.
We could explore a new solution here in the future. Maybe some sort of balancer LP pool that holds both tokens, and users would receive both of them 50/50?
kind of a creative solution with BPT, although I would think there are plenty of multi-token staking contracts that could also be adopted. downside is that migrating current liquidity to new contracts could be a pain. having two pools should basically offer the same thing (the amount of liquidity to each pool should be split such that the total amount of rewards are still being distributed as if it were one pool and APYs between the pools converge), but it doesnāt quite feel that way
This proposal is an extension / amendment of HIP-4, proposing a framework of rewards to enable the sUSD bridge.
There is already a live $SNX pool in Hop with $OP and $HOP rewards. As for this moment, SNX TVL is $1,203,000 and 24h bridge volume is $1835. That is around 0.15% utilization ratio.
In my view, Hopās benefit from subsidizing the sUSD pool, and considering it has already commmitted $HOP to the SNX pool (both SNX and sUSD tokens are from the Synthetix ecosystem) does not justify the allocation of $HOP tokens.
sUSD is a very important token of the Optimism Ecosystem, so in general I think that having a pool should be a very important part of Hopās offerings, benefiting liquidity and swap rates. The reason I voted ānoā is because of the details and mechanics detailed above - I am in favour of the idea of having a sUSD pool.
If the proposal were not to pass, my suggestion would be to review these points on an eventual resubmission:
ā¢ Removing $HOP rewards from the SNX pool and re-allocating them for sUSD
ā¢ Synthetix could allocate more $OP from their own treasury to offset $HOP rewards for the sUSD pool so that they are no longer needed
I would also think itās better for the Synthetix Ambassador Council to recuse themselves from voting on this proposal because I imagine they have a conflict of interest. The snxambassador.eth wallet voted āyesā with 396,000 $HOP voting power
I am also voting No here after lots of consideration.
Really big fan of Synthetix myself and have used Kwenta and sUSD many times so I do understand the importance of the pool.
But I think the counterpoints offered by both @fig and @olimpio are really valid.
If indeed sUSD is more important than SNX then perhaps moving the pool rewards from SNX to sUSD pool would indeed make sense.
Or since synthetix has gotten a quite sizable $9m $OP grant from Optimism Phase 0 grants they could indeed use part of it to incentivize either of the pools.
In general always trying to think of whatās good for HOP itself and as such at this iteration of this proposal I think itās not the best proposal it can be for HOP.
Edit: Rgarding the snxambassadors abstaining, I do agree with @olimpio ā¦ but also as we all noticed there is no abstain option, so considering also the proof of delegate voting/activity problems, leaves little choice.
Perhaps we should ask HOP people to add an abstain option too. @cwhinfrey ?
