Seriously Improving Mirror Protocol #1: Ending Ethereum Liquidity Incentives
This is the first proposal by the Mirror Steering Committee. We are introducing it before the vote on allocating funds to the committee completes given that the community have voted overwhelmingly in favor of our formation, and since it requires no funds to push forward, we can have more time to discuss the proposal.
At the beginning Mirror was the first dapp on Terra, this necessitated incentivizing people to move between Terra and the Ethereum Network hence the need for Ethereum based Mirror emissions. Currently these are 50% of all emissions. However, as time has passed, and Terra has become one of the largest blockchains in the world, this has become a hindrance to Mirror. Most of the pools that are incentivized have very little trading volume. The mTSLA-UST pairing is averaging under $40,000 of volume per day over the last week without a single trade on some days.
This is clearly a vampire pool that serves no value to Mirror and should have its rewards removed immediately. This has been mentioned repeatedly over the last year.
Do Kwon actually mentions the issue with maintaining pool parity with Terra in his v2 post over a year ago. This has clearly not been the case. Currently 50% of all emissions occur on ETH focused on the original pools. Two tokens are no longer in their prior form, but emissions continue to this day to those pools. The mVIXY and mIAU pools no longer have functioning oracles and continue to emit every block. mVIXY holders receive over 14% per day on their liquidity with no fear of being liquidated. There is obviously no liquidity for this dead token, nor has there been for many months.
However, there is a major issue that prevents easily changing the ETH based Mirror rewards; the contract keys have been burned. This will require a migration to a new Mirror token. The community will needs to express our desire for this major error in the original deployment, and solve the problem sooner rather than later. There is ~40m (~$55m) remaining to be distributed on the ETH side between MIR and mAsset liquidity incentives which serve no purpose. Mirror can easily afford to pay for this error to be fixed instead of paying a small number of users in dead pools. TFL would need to either take on this task themselves to rectify their error or work with the community to find suitable developers to take on this task.
What a YES vote means: Express support for ending ETH emissions via a MIR token migration
What a NO vote means: Express support for 50% of MIR emissions to go to a vampire farm
No tokens are to be transferred in this proposal as it is dependent on what TFL decides.
NB: You may recognize some names from the MSC in the prior posts, especially regarding v2 upgrades.