Temperature Check: Solution for LQ Staking and Aquafarmers Problem

After internal discussion within Liqwid Labs and further refinement in the #gov-discussion discord channel, the official recommendation of Liqwid Labs is to
not pursue the temperature check as originally posted by @castler.

Instead, we would like to propose the following alternate renumeration proposal:

  • On the date that the proposal passes, reset all staking clocks and do a 1-time
    credit of 3 months.
  • Institute a temporary 2x additional aquafarmer boost for a period of time starting on the date the proposal passes, and equal in length to the amount of time:
    • from 2023-04-23; the date proposal 0 passed. Before this, no staking rewards were earned, and thus the aquafarmer boost did not matter.
    • to the date this current proposal passes

This is the simplest solution and has the benefit of allowing the team and community to move on from this technical challenge.

Additional assumptions and rationale for not pursuing a more elaborate solution include:

  • Getting boosts into the hands of aquafarmer holders more quickly, decreasing the opportunity cost of a more elaborate solution. Although early adopters may lose a comparative advantage, we believe that that the impact of this will be small and offset by the doubled aquafarmer boost.
  • Developing an elaborate solution would be expensive in terms of time and money, and doesn’t provide long-term value to the protocol or users.
  • Obtaining conclusive data on how many users or how much LQ would be negatively affected by the simpler solution would be at least as hard as developing an elaborate solution; we assume from informal data (such as the number of aquafarmer trades on opencnft) that this number is relatively low. Specifically, we assume that most aquafarmer holders that would be negatively impacted would not have sold their highest-tier aquafarmer during this period.

Finally, there are some difficulties with other proposed solutions (including @castler’s and others floated in the chat):

  • Any solution that attempts to distinguish between people who “restaked” during the single-address stakeover versus those who staked for the first time during that period appears to be at least as technically complex as supporting multiaddress wallets in the first place.
  • There are some concerns about the above solution being equal, but not equitable. In our estimation, both the number of users who would lose a comparative advantage and the magnitude of that loss is small.

Full disclosure: some of the above assumptions are based on technical data and intuition that may not be easily verifiable by the community. However, initial discussion around these assumptions and the proposal itself seems to have fairly broad consensus. We are willing to hear opposing viewpoints (especially those that are able to quantifiably challenge our assumption), but our current stance is that a majority of the voting community will support this proposal if put to a vote.

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I have a reasonable bag and was staked with a multi-address wallet. Not too worried about “perfect” solutions here. The opportunity cost is pretty important at this stage of the game. We need to create well established pools while we have a first-mover advantage, and I would rather see resources move in the direction of a cleaner/more robust marketplace vs getting lost in solving a problem for greener days.

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I can not edit my post starting this thread. But as I said in discord: in many cases the most simple is also the best solution. So I am endorsing this proposed solution from Liqiwd Labs.

I am biased, because I had to restake with my single adress wallet, but I do think everyone benefits at least a little bit and I am not really sure about the disussed ethical problems of not giving early users additional benefits. But even if someone feels a bit uneasy I really hope they see the advantages of solving this problem without too much time and effort being needed from the team, so they can work on something else.