CIP Feedback - New Compound COMP-enabled pool - Request for feedback

Summary:

This first proposal would introduce a new Compound pool (USDC/DAI) which would be capable of claiming COMP as well as receiving CRV.

Abstract:

The current Compound pool remains one of the most trusted Curve Finance pool but all COMP from liquidity provided in it is currently lost.

Motivation:

This proposal has three parts and will be officially submitted after sufficient feedback has been received:

  • Adding a new Compound COMP-enabled pool to Curve Finance with DAI and USDC
  • Receiving feedback on the possibility of the upcoming boost also applying to incentives (in this case COMP). This means that boosted liquidity providers in this pool could receive more COMP than LPs who haven’t locked any CRV for the same amount of provided liquidity.
  • Receiving feedback on the introduction of an admin withdrawal fee of 0.02% that would be used to burn CRV for this pool (how much it should be amongst other things)

Should a new Curve Compound pool enabled for COMP rewards be created?

  • Yes
  • No

0 voters

Should the new Curve Compound gauge have a withdrawal admin fee of 0.02% to be used to burn CRV?

  • Yes
  • No

0 voters

Should the vote locking boost also apply to COMP rewards on the Curve Compound gauge?

  • Yes
  • No

0 voters

Should the new Compound pool also add USDT?

  • Yes
  • No

0 voters

7 Likes

Seems straightforward. Might as well be collecting COMP if you’re holding cTokens.

I posted in discord that a 0.02% withdrawal fee is very low, but I’m sure the DAO could vote to raise it in the future.

Also 0.02% is very low? If you stay for 1 day - 7.57% APY, 1 week - 1.05% APY, 1 month - 0.24% APY. There’s room for it to possibly be higher.

2 Likes

I think the most contentious part of this proposal is whether or not the boost should apply to COMP rewards. The concern seems to be that boost could be difficult to reach for some and that it could be unfair.

4 Likes

It’s exciting to see Curve modernize the Compound pool in order to support the COMP Distribution, which will be a meaningful improvement to the returns (and usage) of the pool. A few points:

  • When the Compound pool was originally launched, the Compound protocol did not yet support USDT; only DAI and USDC. It’s cool to see a throwback to the most trusted assets (without the perceived “USDT risk”) - but I could also see a strong argument for including USDT in the modernized pool.
  • Personal opinion, but weighing the COMP distribution by CRV locking seems like it would add meaningful complexity (after all, the pool returns aren’t weighed by CRV locking). Would prefer that Curve focus on simplicity of implementation, and minimizing gas costs.
9 Likes

CIP-1! What do you say about breaking out the second question from the CIP and have a separate discussion whether to use the fees to buy & burn or pay out to veCrv holders?

1 Like

I support the new pool, but not the vote lock boosting for COMP rewards. The complexity of the vote lock system may scare away funds that would otherwise transition over. I support adding veCRV value accrual systems in the form of fees on the pools, but not altering distribution of 3rd party incentives.

6 Likes

Regarding the first point, I think what can be done here is:

  • Keep the Compound pool cDAI/cUSDC as it is because people see USDT as risky and having that pool is important.

  • Make a new Compound pool with cDAI/cUSDC/cUSDT and let Curve Gauge Weight Voting decide which pool gets the CRV inflation and thus also can help decide where liquidity migrates to

2 Likes

If safety is a major concern for this pool USDT definitely should not be included, otherwise we may not get a ** REAL SAFE ** pool

7 Likes

With this pool being regarded as the safest Curve pool, I would agree that the new pool shouldn’t have USDT with the option to add a third Compound pool with USDT if there is enough demand and liquidity.

8 Likes

I voted no for the second point to make thing a bit simpler for LPs. CRV rewards are already complex and COMP rewards are from Compound so doesn’t sound fair to me yield boost from CRV will change the COMP rewards.

3 Likes

It will set the precedent for the external incentive for sure, because after all. Why would SNX incentive wouldn’t be boosted too. So no.

0.05% withdrawal fee is ok, It is bonus for opportunity to earn more than cToken just sitting in the wallet.

1 Like

[quote=“rleshner, post:5, topic:23”]
but I could also see a strong argument for including USDT in the modernized pool.
[/quoute]

Indeed! Do we want USDT here? I can see reasons “for” and “against” USDT. But maybe can make a pool with USDT, and leave the old one as is

Oddly enough, a gauge where CRV boosts COMP is easier / using less gas than the one which is not doing so. The only objection is “fairness” of the distribution - hence the poll

1 Like

@gunboats Hmm, the SNX rewards might get boosted by veCRV.

True as well. And yes, the gauge would use slightly less gas if that is done

1 Like

Somewhat relevant thread from the Compound forum: https://www.comp.xyz/t/compound-proposal-022-systematically-reduce-emission-quantity/241

TLDR: A large majority of farmers is selling their tokens right away via DEXes and Gauntlet is suggesting the following:

  • Decrease rewards (20%)
  • Skew rewards towards borrowers (bad for Curve)
  • Implement time lock for rewards

Aside from the fact that these insights are super helpful for the Curve community as well, Gauntlets proposal could basically make COMP enabled pools less profitable than they would currently be. The current net COMP APY for the USDC/DAI pool would be at ~5.6%. Should Gauntlets proposal pass, this would be reduced by 20-40%.

Sounds sensible and fair

Very strong point.

This will dilute CRV incentives of the current pools and make the overall APY less attractive to LPs taking into account falling CRV price.
Better stay with the current DAI-USDC pool. USDT is a tinderbox, a time ticking bomb, a black swan event nobody wants to take into account. People got so psychologically used to it over the years, but this doesn’t eliminate the risks. Turkey didn’t foresee it was going to be slaughtered on the 365-th day for Thanksgiving, because every day looked exactly like the previous one.

Glad that the poll ended up being not very contentious!

1 Like

I support the new pool, but not the vote lock boosting for COMP rewards. The complexity of the vote lock system may scare away funds that would otherwise transition over. I support adding veCRV value accrual systems in the form of fees on the pools, but not altering distribution of 3rd party incentives.

Agree very strongly with this.

4 Likes

Where does this stand - I had heard that the new contract was being audited pre CRV - so is it ready - only waiting on a vote and community agreement on details like to boost COMP or not to boost COMP?

1 Like