Summary
Change the Based ETH (bsdETH) Reward Ratio from 2.5 Days to 1 Week.
From
2.5 Days: 0.0000032090147
To
1 Week: 0.000001069666666666
Abstract
Currently, the reward ratio is set to 2.5 days. This proposal, if enacted, would change the reward ratio from 2.5 days (0.0000032090147) to 1 week (0.000001069666666666).
The rewardRatio is how much of the Furnace melting and stRSR drip to perform per block, as a function of the currently held (post-auction) revenue.
Problem Statement
The current reward distribution mechanism is set to distribute rewards over a period of 2.5 days, corresponding to a reward ratio of 0.0000032090147.
This rapid distribution can lead to frequent adjustments and potential imbalances as new stakers enter the system. Early stakers may not be adequately incentivized, and the fast-paced distribution could cause inefficiencies in the reward system, impacting long-term user engagement and the stability of the protocol’s incentive structure.
Rationale
The proposed change to extend the reward distribution period from 2.5 days to 1 week is driven by the need to create a more sustainable and equitable reward system within the protocol. The current rapid distribution schedule may lead to inefficiencies and diminish the incentive for early stakers, as rewards are quickly diluted with the influx of new participants. By slowing the distribution pace, the protocol can ensure a more consistent reward flow, enhancing long-term engagement and better aligning with the overall objectives of stability and fairness in the staking ecosystem.
By transitioning to a new reward ratio of 0.000001069666666666, which corresponds to a 1-week distribution period, we aim to create a more balanced and sustainable reward system that better aligns with the protocol’s long-term objectives.
Risks
One potential risk is that it could introduce opportunities for people to stake, get yield, and then unstake. However, this is unlikely to be profitable with the 2 week unstaking delay.
- I am in favor of changing the reward ratio
- I am NOT in favor of changing the reward ratio