Staking revenue

Hi All!
I have a proposal from all community about staking!

Simple Summary

This proposal calls to give revenue for staking from DAO treasure.

Motivation

For now, in DAO treasure we have almost 9 million USD. I guess we should use them to give 1inch token holders more motivation to hold 1inch tokens and also to popularize a 1inch project.
Every day in telegram chat we can see messages with content like that - “where I can stake 1inch tokens? Where I can get good APY?”. So why we can’t give benefit 1inch token holders from DAO treasure?
I don’t see any reasons to not do that

Summary

If we will decide to approve and implement this proposal we will:

  1. Pwopularize a 1inch project.
  2. Say thanks to 1inch token holders
  3. Find a real case to use DAO treasure and show to comminute that we can really have an influence on 1inch project with DAO.
9 Likes

You need to first find a way for DAO to earn on it’s own , after then start thinking feeding the stakers which will Dump 1inch 100% and Make sell side pressure even greater .

5 Likes

So are you saying you’d prefer if the DAO focused on earning interest on the funds held by the DAO’s treasury, rather than focusing on distributing those funds to stakers?

If the 1INCH distributed to the stakers is first bought on the open market by the DAO, then there should be no net gain in sell pressure.

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Yes . This route looks more sustainable to keep Dao engine running even in tragic cases like if 1inch get dethroned from it’s chair by a better competitor in future etc. The revenue we generate from surplus will decrease a lot . Leeching it more won’t do any good . Instead we need to act asap to make DAO self earning so if we want stakers to earn we can just tell the stakers to stake 1inch & get the interest earned by DAO distributed to them from the Interest pool.

@Natalia Made the Proposal that 1inch Trading Strategy will earn & make 5% stable Apy for treasury which didn’t worked out & now we’re stuck again in the loop in finding an another way of self earning dao + Forum discussions are low so i don’t think community even care about that much right now .

SAD

3 Likes

Natalia Made the Proposal that 1inch Trading Strategy will earn & make 5% stable Apy for treasury which didn’t worked out & now we’re stuck again in the loop in finding an another way of self earning dao

Good points. For those who don’t know, we’re referring to the dicussion that spawned the creation of the DAO Treasury:

I think what threw a wrench in this plan was that the yields from the first Earn product were lower than anticipated – the plan kind of hinged on yields of ~10%. And those yields had to be structured in a manner that we could trust them with our treasury (didn’t want to hand control of the treasury over to a 3rd party).

Maybe we could look into using Balancer’s boosted pools assuming that 1IP-07 passes?


What about the hybrid approach?

  • % of the DAO Treasury’s revenue goes to the DAO investment fund.
  • % of the DAO Treasury’s revenue is used to secure 1INCH on the open market and is distributed to stakers? ← This would give governance participants more voting power (like what this post is advocating for).
3 Likes

It should but I hate to admit we need more discussions here on such topic . Thoughts of other users etc.

On chain data shows 80% of users sold 1inch rewards during old governance model . We need a bonding structure where people keep the stake in governance & get rewarded at the same time

3 Likes

It should but I hate to admit we need more discussions here on such topic . Thoughts of other users etc.

Yeah. Hoping that the Layer3 contest will incentivize more people to come to the forum and post their thoughts.

On chain data shows 80% of users sold 1inch rewards during old governance model . We need a bonding structure where people keep the stake in governance & get rewarded at the same time

You have a link to this data? Maybe Dune analytics? I’m not challenging the assertion, I just want to be able to review it and cite it.

4 Likes

I don’t think 1inch gonna need a 3rd party outlet hub to get users here . 1inch has grown to a big Company boasting thousand of users . It’s just that you need a refreshing Governance UI that is unique , that’s enough to channelise your users to be quite productive in governace tasks . Layer 3 is good for smaller Dapps that have have not as much wider reach like 1inch .

I have heard you guys working on New Gov UI & if that’s so then make 100% sure you do user feedback very serious & figure out the things they want to be implemented on that as they are the one
who ultimately be using it .

2 Likes

Exciting to see this kind of discussions on the forum.

Indeed, staking has to be incentivized imo but not through simple treasury funds distribution. We ought to come up with more meaningful way to keep the treasury self-sustainable and gainful at the same time.

To provide into farms/pools with the highest APYs is a good start but make claimable rewards be distributed only to active in Governance stakers (not to anyone who stakes).

Thoughts?

4 Likes

Normal Staking APY & boosted APY which includes task based system
We can even include delegation tasks based on the amount & time the tokens are committed to

1 Like

I personally like the idea of reinstating the rewards program. It has a certain degree of marketing appeal and made the name 1inch appear everywhere. It drew in a bunch of people, that sort of disappeared when the rewards did. We need a mix of project appeal but not at the expense of the DAO. I think that a good marketing push would draw the crowd back, and then we can explain the virtues of the DAO. Members of the DAO could get an extra %. We could setup a tier structure, just minimum. Maybe run it for 6 months, a possible extension to 1 year. In the end, people want to make money and be part of a project.

4 Likes

I think a great Idea would be sending a simple 20% to the treasury, 20% to buying and burning 1inch token and the rest goes back to stakers and bonuses can go to those who participate in governance like the post roxan shared

That way it would still allow the treasury to earn while also appealing to the stakers and those who enjoy burning mechanics.

4 Likes

Here are the example -

Governnce UI , Although Many things can be added

Xp based on Tasks

2 Likes

20% to buying and burning 1inch token

Personally, I hesitate to buyback-and-burn (BB&B) 1INCH with treasury funds this early in the project’s life (early meaning anytime before late 2024).

We’re currently at 415M of the 1.5B total future supply of 1INCH [source]. So, the supply is schedule to roughly triple over the next 3 years… there is no way we’d BB&B enough 1INCH over the next 3 years to make the supply deflationary.

Instead, at this stage, I think those funds would be better used to reward Governance participation (to make the DAO more robust) and grow the 1inch Network Protocols.


I look at BB&B as analogous to dividend payments in trad-fi. Just like Amazon in the early 2000’s, I believe 1inch DAO should focus on growing its protocol and making its decision making process more robust before much effort is put into BB&B.

However, my mind isn’t made up on anything in DeFi. I’m totally willing to hear out arguments advocating for BB&B. I just wanted to explain where I’m coming from.


My opinions on this topic are 100% personal and I do not speak for the 1inch Foundation or any other 1inch contributors.

2 Likes

Hi there,

I think some form of revenue sharing with stakers would make total sense, as long as the revenue distributed is coming from a sustainable source. I was looking at Token Terminal to see how the DAO revenue has evolved overtime, and I am very surprised with what is being reported there: monthly revenue were around $3-5m between January and May 2021 (with an astonishing $16.4m in Feb 2021) and completely collapsed after that to ~$50-75k/m in the last 3 months. This period of high revenue coincide with the 1inch liquidity mining program, but I don’t understand how that would have boosted revenue, especially as trading volumes have overall continued to growth after the program ended (1inch dashboards and analytics). Maybe this is an issue with what Token Terminal record as revenue.

Is there any analytics available somewhere to understand the various sources of revenue and their development over time? I think that’s a key element to understand before deciding to distribute any fund from treasury to stakers without jeopardise the long term sustainability of the protocol.


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https://app.intotheblock.com/coin/1INCH

1 Like

I was looking at Token Terminal… Maybe this is an issue with what Token Terminal record as revenue.

That is definitely an issue with Token Terminal, I don’t know where they are getting their numbers from but they are not accurate. Maybe they are counting airdrops, liquidity mining, and/or gas refunds? I have a little breakdown of the revenue below.


1inch DAO Revenue Stream

The 1inch DAO Treasury’s revenue stream is from the Swap Surplus. All of these funds go straight to the DAO’s Treasury and the spending of these funds is governed by the DAO participants.

The Swap Surplus varies from trade to trade, but a rough estimate is ~0.01% (one basis point) of 1inch Aggregation Protocol volume. This sounds like a small amount, but 1inch has insanely high trade volume since the protocol has a majority of the DEX Aggregator marketshare.

Here’s an example of the revenue numbers we’re talking about using the last 7 days of data (this is a slower weak than usual)

7-Day Revenue Calculation

  • 7d Volume = $2.4B
  • 7d DAO Revenue = $164K
  • Revenue as a percent of volume = 7d DAO Revenue / 7d Volume = 0.007%

Historical Revenue

The 1inch DAO Treasury was launched 170 days ago and has collected ~$9M in revenue.

1inch DAO Treasury

Address: 0x7951c7ef839e26F63DA87a42C9a87986507f1c07

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Is there any analytics available somewhere to understand the various sources of revenue and their development over time? I think that’s a key element to understand before deciding to distribute any fund from treasury to stakers without jeopardise the long term sustainability of the protocol.

The closest thing available right now is the 1inch Dune Analytics Dashboard that you already mentioned. The other ones I know of are just analyzing the 1INCH token and have nothing to do with the 1inch Network itself.

This whole discussion really shines light on our lack of a purpose-built 1inch Analytics Dashboard – I think the 1inch Network would benefit immensely from it.

3 Likes

we need Applicants for such Dev works that can be funded exclusively by DAO . 1inch Labs i think alreadystacked up with various projects so it’s no use giving them more burden which will delah the product release even more . Layer3 seemed lacking in dev work listing so we need to find alternative . Maybe this have to be included in the governance

Community vote in for a feature
published on governance UI that directly pings the work on twitter & other socials
Developers were asked to put forth their Bid amount to completethe work

Something like that

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we need Applicants for such Dev works that can be funded exclusively by DAO . 1inch Labs i think alreadystacked up with various projects so it’s no use giving them more burden which will delah the product release even more

I think that’s a great idea! Are you willing to take the lead on this proposal? I can offer my services with editing.

Now is a good time to make a proposal seeing as the 200 1INCH prize is currently uncontested.

1 Like