We propose adding a new gauge called Curve VolumeGauge to track Liquidity Provider (LP) rewards that Curve will distribute to the Curve VolumeGauge contract instead of the Liquidity Provider. With this new approach to LP rewards, we hope to encourage further development of trading routes to the Curve pools and to also grow Curve trading volumes.
Curve VolumeGauge is a set of Vyper contracts that allow anyone to trade on Curve, but tracks the CRV LP rewards and receives the rewards to the contract instead of the sender. The goal of this proposal is to whitelist these proxy contracts so that anyone who creates trading interfaces to Curve that will receive the LP rewards for delivering the additional exchange trading volume.
Curve currently only rewards Liquidity Provider (LP) accounts that trade on Curve. This limits the ability for 3rd parties to build trading interfaces on Curve that will reward them as affiliates. Affiliates need to be incentivized to direct trading volume to Curve pools. We believe there’s an opportunity to grow the affiliate exchange volume to Curve pools with the Curve VolumeGauge.
The Curve VolumeGauge will allow Curve to track LP rewards and direct them to the trading interface owners that drive exchange volume. The marginal revenue from interface volume will allow 3rd parties to build and acquire more trading volume that they can point to Curve. More trading volume on Curve will help all Curve pool liquidity and will also help create more demand for Curve tokens.
We are motivated by the opportunity to collect a portion of the LP fees for providing this service to Curve trading partners. If we are able to successfully collect some portion of the LP fees, we would be incentivized to acquire more partners that will leverage our contracts to drive exchange volume to Curve pools. We see this as a positive feedback loop for Curve.
- Github: https://github.com/VolumeFi/curve-volumegauge currently is launching to track the following first three pools:
We will continue to roll out coverage for all Curve pools.
Directing rewards to 3rd parties that drive volume is very typical affiliate marketing activities common in financial markets.
Enabling anyone to develop interfaces that are compensated by Curve rewards for successful trades
Desire for greater Curve trading volume and demand for CRV
The value of CRV rewards are either low and will be phased out such that these types of incentives will not be useful by 3rd party trading partners.
Post a link to your proposal if it’s already been created