PRELIM: A Proposal to Overturn Current Staking Mechanism

New Proposal Discussion
21

Do you think staking is driven by loyalty or by greed, mostly?

  • why do you think it’s greed to stake?

As people can stake and still offer nothing to the projects we’re involved in or to Ethlizards itself, is it really loyalty?

  • How is this different to your proposal?
  • implies something different means worthiness of receiving investment.

As I mentioned, I think loyalty is helping the projects we invest in, building utility for other lizards, offering marketing services, creating content and whatever else you can think of and doing that consistently. That’s the sort of loyalty I think should be rewarded.

  • Sure yet what does that have to do with your proposal?
  • what is The Reward?
  • what is considered enough?

This was one of them. You have mentioned what you think and I see that I may be nitpicking yet I’ve sent you mentioned engagement and greed in a few replies to conversations. I also note this was in response to someone and maybe you don’t think this yet it’s been used to boost your argument, in my opinion.

I’ve also asked how your proposal helps small investors when the opportunity to earn extra on your small investment is gone?

I being intense and I am voting yes to have the proposal put through. I guess I’m thinking why when the projects just started should we go down an unproven (?) Road. My understanding was that our value was the investments and connections not how much you could sell your lizard for including possible redivs in the price?

I’ll look for more.

22

Hey all,

The debate has been great so far, and thanks to cryptish for putting the LIP together. I haven’t seen a case for non-weighted staking put forward so I present one here for your reading pleasure. I think it offers a few benefits over non-staking. Look forward to your response!

Non-weighted Staking

  • I propose we have a staking contract, in a similar vein to YFI vaults.
  • Reward ETH should be injected into the staking contract by the council on liquidating a position.
  • Rewards accrue to each staked Lizard per block, on a linear or curved schedule.
  • Lizard owners are able to claim their rewards from the contract at any time.
  • When unstaking, any rewards will automatically be claimed.
  • Staking isn’t weighted. 1 LIZ = 1 LIZ.

Benefits

  • Rewards are smoothed. No lump sums. More stable price floor.

  • We can generate an accurate APY based on the current floor price of a liz and the reward per block.

  • Owners can move their Lizards to a different wallet and only lose rewards for the time they are unstaked.

  • New owners can immediately start recieving rewards.

  • In times of mass panic (ie. Kieran gets busfactored) many people may list their Lizards. Staking rewards people to stay staked.
    a) Holders will need to unstake before they list their Lizard.
    b) When they unstake they increase the rewards given to every other Staked Lizard.
    c) This increase helps offset and loss in value per Lizard, and helps restore confidence / increases the value proposition to new buyers.

Marketplace Value.

  • The market would price a Lizard based on rarity + (current APY or future predicted APY).
  • This is simpler than needing to work out the rewards attached to each Lizard.
  • If each lizard has a different amount of rewards attached, this would completely override the established rarity structure.

Against The No Staking Approach

  • Manual snapshots are time consuming, and can be front run by insiders. With staking the council doesn’t need to be concerned with who owns what.
  • Complicates the valuation for each lizard as buyers need to consider the rewards attached to an individual Lizard instead of just the general current APY.
  • Following on, this muddies the rarity structure.
  • Requires a smart contract to claim from anyway.

One last thing, when I stake my lizard, I would consider it to be Lounging in the Lizards Lounge. Perhaps we could build a cool UI around that idea, or come up with something better :slight_smile:

3 Likes
23

Hey @yeehah, thank you and appreciate your response.

I have a few comments about your proposed option as there are some issues with how that would work.

“Rewards accrue to each staked Lizard per block, on a linear or curved schedule.”
Cryptish - There are over 6,000 blocks per day, so this would be intense. If you mean this should be updating a smart contract, this would be so costly that it would wipe out the vault in a day or two. Let me know if I’ve misunderstood you here.

“Lizard owners are able to claim their rewards from the contract at any time.”
Cryptish - They can already do this with non-staking.

“When unstaking, any rewards will automatically be claimed.”
Cryptish - The team can’t really transfer rewards to each lizard as this would costs thousands of $ over time. You have to have each lizard manually claim, instead.

“Staking isn’t weighted. 1 LIZ = 1 LIZ.”
Cryptish - Agreed on the 1 liz = 1 liz, this is also an important part of my LIP.

Couple of other points

Whichever way we go, the market will take into account rarity only if the market decides to. Staking or non-staking won’t affect this. It’s simply down to the market to decide if they deem rarity valuable or not.

You refer to “rewards” a lot, is this rewards for staking or revdis?

If it’s rewards for staking, where are these coming from? Who’s paying these rewards and what pile of money are they taken from?

24

Thanks for the feedback.

There are over 6,000 blocks per day, so this would be intense. If you mean this should be updating a smart contract, this would be so costly that it would wipe out the vault in a day or two. Let me know if I’ve misunderstood you here.

The short answer is fancy maths calculates it on the fly while claiming.

Longer answer: One of the things an Ethereum contract knows about its execution environment is the current block number (block.number). So the idea for each NFT you track in the contract the last time (block) the reward was claimed, then you can calculate how much is currently owed based on the total ETH in the contract, number of staked nfts and the rate of dispersal. So you don’t need to do multiple transactions to keep it up to date, instead it gets calculated on the fly during the claiming process.

This isn’t a new concept for devs - its very similar to the original stakingrewards.sol contract from Synthetix. This video has a really good explanation of how it works for that contract:

The team can’t really transfer rewards to each lizard as this would costs thousands of $ over time. You have to have each lizard manually claim, instead.

Yep each owner would have to claim manually, hopefully they can claim for all their lizards in one transaction. While each owner would bear the cost of the claim, it would reduce the workload on the team, and also they don’t have to worry about accidentally airdropping to the wrong addresses.

I understand people have been burned by Ethereum fees in the past (looking at you ILV staking) but the (long term) solution to that should be moving to an L2.

Whichever way we go, the market will take into account rarity only if the market decides to. Staking or non-staking won’t affect this. It’s simply down to the market to decide if they deem rarity valuable or not.

Not sure I agree on that. One of the things about collections with rarities is that you want to protect the existing rarity at all costs or you are hurting the people that invested in the rarer traits. I dunno, I see your point, but I think making the purchasing decision more complex doesn’t really help anyone.

Rewards = revdis, was just thinking from a technical perspective, my bad.

One for you - You mention a snapshot of holders - is this a manual process, with the idea of airdropping the full revdis to each liz at or shortly after the time council liquidates a position? Or do we have a claim contract where you verify your account and get paid out accordingly. The latter would be required to have any revdis attached to a Liz at point of sale, which means owners still need to pay eth fees to claim. I dunno just found this a little confusing.

25

Hey @yeehah.

Will checkout the video soon!

So, with non-staking, holders would claim manually, too, so there’s no worry of the team airdropping to the wrong address, either.

I’m not understanding your point regarding rarity. Why would non-staking affect rarity in any way?

I think there’s some confusion between us regarding my proposal. I’m saying, on our dashboard, you show a total value of ‘current net worth’ per lizard. This is essentially just a quick check of the coins we’re invested in and their current price vs. the price we bought at. Really easy to do and would just show everyone the current value. You can do this with staking or with non-staking, but my argument continues to break down why non-staking and no weight-based calculation is also more attractive to newcomers. We tell new buyers that they will receive an equal position in these investments, per lizard, if they buy right now.

Traits aren’t a factor in terms of staking vs. non-staking. If you own a rare trait, you can still price it slightly higher than others when you sell, if you think people would prefer it.

For your last question… claiming is going to be the same process no matter what happens. The council take a snapshot (of either holders or stakers, depending on how we proceed) and then assign the ETH values to each address. Lizards then manually claim this from the contract.

I think there’s a lot of confusion around, would love the chance to chat to people on a voice channel or something as it’s much quicker when clearing things up!

1 Like
26

Was just going to suggest this. When the back-and-forth becomes this complicated, a voice chat is much more efficient.

1 Like
27

Ah yep ok I get it now re dashboard. I still think it having a different valuation metric to other projects may be a downside. Still not a fan of snapshotting as its corruptible, and I still think we should stream revenue instead of assigning it lump-sum. Anyways it looks like the LIP is across the line! Congrats! :handshake:

28

Hey @yeehah.

Just want to say that these things you’ve mentioned aren’t related to this LIP, just to clear up any confusion.

“having a different valuation metric to other projects may be a downside” - This is how Ethlizards will work regardless of staking or non-staking. Any new buyer will check our investments before purchasing. Ethlizards is based on this idea, that we have another metric outside of rarity.

“Still not a fan of snapshotting as its corruptible” - We’re going to use a snapshot either way. This isn’t related to my LIP. You could always create an LIP regarding how we go about this.

“I still think we should stream revenue instead of assigning it lump-sum” - Same as above. It’s not something my LIP is bringing in, this is another process that we could talk about on another LIP if you wanted to.

The first vote we have at the moment is only the prelim, so we’ll vote on the LIP next!

Thanks