Rewards Evolution

Tech/Network Upgrades
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Great set of changes that I’m fully supportive of making. I think evolving CAR allocations with a focus on active Creator Coin economies + flow controls + better distribution mechanics will achieve much more alignment with Creators, fans and the crypto community.

I’d also like to propose that we increase the CAR allocations to help fuel healthier sidechain activity in Creator Coin economies. The initial CAR emissions published here were designed to be quite conservative as the network first launched. Given the rapidly growing interest and improvements to the CAR designs proposed here and observed already with v2 flow controls, I think we’re in a good state to start to increase CAR rewards to make sure that Creators, fans and the crypto community are rewarded for deeper participation in the network.

I’d propose that we increase CAR rewards and allow the core development team a range of 1x to 4x the published rate. I’d propose we have a bias towards higher ends of the range while we have a smaller creator base to generate greater creator word-of-mouth and drive usage of Creator Coins. I’d propose we dial down the CAR rewards appropriately as we either scale the creator base or the community does not see ROI in terms of increased Creator onboarding and Creator Coin usage. In any multiplier case, the 1M $RLY reward cap would be unchanged.

For comparison, YDVs emitted between 250K-1M $RLY a day. 4x our current emissions would be roughly 200K/day. As we’ve retired YDVs, I think the network can handle increased emissions to generate more positive word-of-mouth by creators and usage of Creator Coins.

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:exploding_head: LOL! Our creators/communities are going to lose their minds when they find out about this!

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That would be a desired outcome :fire:

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Love all of these ideas except:

  • Distribute coin rewards to users as RLY based on pro rata ownership of the coin as opposed to simply increasing the backing liquidity pool

Reasons I dislike this idea:

  1. Over time dead wallets will become a thing. We are simply sending RLY into the void of accounts that will never again see the light of day. Instead of those dead accounts continuing to benefit the remaining active community members, the additional value is siphoned into the void.
  2. We lose out on auto-compounding. Users who don’t want to login every weekend to reinvest their rewards are essentially losing out on gains because RLY doesn’t generate rewards on its own. If anything is shown by dapps like autofarm and pancake bunny, it is that auto-compounding is a valuable feature. I see this as a step backwards, not forwards.
  3. Equitable entry. Everyone in the community who supports a creator deserves equal share of that creators coin rewards, in the form of that creators coin. This will create a more competitive environment for the true believers. If I want to maximize my CC, I need to beat everyone else to enter into that coin the day we get our rewards so I get the best pricing on my entry. Much prefer everyone gets auto-entry into the coin, same block, fair proportions.
  4. The spirit of the idea. This is probably the most minor, because its more of a mentality thing. In the previous system, if you wanted to cash out your rewards, you would have to actively sell the creator coin you believed in. Under the new system, you’ve essentially already cashed out, and now you would have to buy in. I think from a user mentality perspective its a lot easier to decide to cash out once the money is already out of the creator coin. To push the spirit of this idea, try the thought experiment of, why don’t we just distribute CAR as USDC or ETH? Then people can always just buy RLY and buy their favorite creator coins every week with their rewards. You can quickly see the sell pressure that creates on RLY, and while I don’t think it will be as noticeable, I do think it creates similar sell pressure on the creator coins that earned those rewards.

I think this is why you see buyback and burn as more popular than dividends in crypto in general. The only exception to that is staking, but this is hardly a staking system. Staking rewards are almost never given to all coin holders, it is usually an additional required action to provide a benefit with your coin. Given that this is not what is happening with the creator coins, I feel we should stick to the buyback and burn model that works for so many crypto projects.

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Mason - Thanks for your thoughts here. I haven’t been as active in the forums of late, but always appreciate a good discussion on Rally! Here is a quick write-up on why I believe in this system. Also available on discord if you want to discuss too.

I don’t want to lose sight of Kevin’s proposal to increase the CAR rewards and hope to see a proposal perhaps with some options for a 3 or 4x increase.

Also, I imagine Delphi is looking at CAR in general, but also CAR in relation to the alternative creator bonding curve templates they are designing. Look forward to their weighing in on how we can further optimize the CAR, and any considerations for creator communities employing these additional curves.

I saw from your last post and here that you’ve thought a lot about these rewards, and graciously shared that thinking with the community. Always encouraging to see a robust discussion on topics so important to the growth of the network!

In responding, I wanted to recall first what are the Community Activity Rewards from a network perspective?

Community Activity rewards are a subset of Network Usage Rewards (something like 5B or 7.5B RLY allocation), so that we keep this as our North Star: this idea that these rewards should further incentivize network usage. The “Community Activity Rewards are designed to specifically reward creator communities who actively participate in the Rally Network.” (From blog post)

The blog post also notes that everyone benefits when the $RLY is added as backing to the creator coin instead of going to individual users.

However, @daddyfatsax points out that in practice this wasn’t true…hence the redesign here:

“I believe the current reward design began with the thinking that consistently increasing total liquidity backing a coin is one of the strongest indicators of the health of a creator coin community and should therefore be the basis of a reward system that benefits the entire community. However, the mechanics of the calculation and distribution mean we’re not quite incentivizing positive movement in this indicator; instead, we’re enabling active traders to capture rewards independent of their effect on this metric, and we’re generally increasing/concentrating the volatility of a creator coin around the timing of reward distributions.” -DFS

The pro rata distribution of $RLY directly to CC holders seems to absolutely solve for this issue (active traders in a CC will only capture their pro-rata share). I don’t think you contend with this, but I want to make this point. It does create other potential issues that you outline, but do those issues outweigh the potential for active traders to capture rewards? No, not in my opinion. I’ll outline my thoughts below. Reminder for myself - does this system check the two boxes? 1. Further incentivize network usage. 2. Reward community members for their contributions to the network.

“1. Over time dead wallets will become a thing. We are simply sending RLY into the void of accounts that will never again see the light of day. Instead of those dead accounts continuing to benefit the remaining active community members, the additional value is siphoned into the void.”

Because RLY has a fixed supply, taking RLY out of circulation benefits all RLY and CC holders. I don’t think we should scrap the proposal or optimize around the smallest set of inactive users. Let’s design for the bread and butter users.

“2. We lose out on auto-compounding. Users who don’t want to login every weekend to reinvest their rewards are essentially losing out on gains because RLY doesn’t generate rewards on its own. If anything is shown by dapps like autofarm and pancake bunny, it is that auto-compounding is a valuable feature. I see this as a step backwards, not forwards.”

Very important here. The change proposed here is precisely for these users who aren’t logging in each weekend, and have been seeing their gains being scooped up by active traders. This has forced savvy supporters to sometimes painfully sell their CC before the drop to protect their investment in their creator. This is strictly broken.

Instead, under this system CC holders now realize the gains in RLY. They might miss out on FURTHER gains by not reinvesting in CC’s, but at least they have captured their share and will continue to do so in perpetuity based on their CC holdings. Active fans will almost certainly take this opportunity to use RLY to purchase more of their favorite CC anywhere across the RLY network.

However, you do raise an additional opportunity here that should be considered where RALLY could create an option for CC holders to opt-in to have their RLY rewards from a single or all their CC’s immediately reinvested back into the corresponding coins at the weekly rewards drop. Seems technically possible, though I don’t know if there would be any regulatory concern here.

"3. Equitable entry. Everyone in the community who supports a creator deserves equal share of that creators coin rewards, in the form of that creators coin. This will create a more competitive environment for the true believers. If I want to maximize my CC, I need to beat everyone else to enter into that coin the day we get our rewards so I get the best pricing on my entry. Much prefer everyone gets auto-entry into the coin, same block, fair proportions.

I think it is preferable to create a system where folks are racing to enter a coin at the end of each week than racing to exit under the current system. See above for creating an option to opt-in. I’d also add that for most supporters, this system allows them to maintain or grow their stake, but protects them from a depreciating interest in their creator."

“4. The spirit of the idea. This is probably the most minor, because its more of a mentality thing. In the previous system, if you wanted to cash out your rewards, you would have to actively sell the creator coin you believed in. Under the new system, you’ve essentially already cashed out, and now you would have to buy in. I think from a user mentality perspective its a lot easier to decide to cash out once the money is already out of the creator coin. To push the spirit of this idea, try the thought experiment of, why don’t we just distribute CAR as USDC or ETH? Then people can always just buy RLY and buy their favorite creator coins every week with their rewards. You can quickly see the sell pressure that creates on RLY, and while I don’t think it will be as noticeable, I do think it creates similar sell pressure on the creator coins that earned those rewards.”

While we are still in early adopter territory, I think we should continue to optimize the network for supporters above all else - even those supporters that fall into the backers category (to borrow from the user archetypes of supporter/farmer/backer that you outlined in your earlier post). Ultimately, I believe that building a robust network that can incentivize “supporters” is what will determine the success of the platform. To that end, distributing $RLY governance tokens to Creator Coin holders seems like an elegant way to incentivize further platform participation and activity, particularly for supporters. The greater risks of the previous system were clearly manifested for several communities, and so I support this in the absence of a better proposal to incentivize and rewards communities that grow network usage.

Cheers,
Grand

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“I believe the current reward design began with the thinking that consistently increasing total liquidity backing a coin is one of the strongest indicators of the health of a creator coin community and should therefore be the basis of a reward system that benefits the entire community. However, the mechanics of the calculation and distribution mean we’re not quite incentivizing positive movement in this indicator; instead, we’re enabling active traders to capture rewards independent of their effect on this metric, and we’re generally increasing/concentrating the volatility of a creator coin around the timing of reward distributions.” -DFS

Yes, I read and responded to this original post. I have also read the blog post talking about the spirit of the design. Maybe I’m misunderstanding how the pro-rata distribution is calculated, but I don’t see how it solves people jumping into a coin right before the reward, getting their distribution, and then selling after. The flow controls, seem to help a bit with that, but I don’t see how this change does. Unless what you are saying is it is time based, on how long they were in the coin, and in that case I feel like this is a strictly worse implementation of paying the rewards out block by block like almost every single other defi project does. Why are we trying to reinvent the wheel?

“Because RLY has a fixed supply, taking RLY out of circulation benefits all RLY and CC holders. I don’t think we should scrap the proposal or optimize around the smallest set of inactive users. Let’s design for the bread and butter users.”

I don’t think it benefits them. Take it to the extreme: why don’t we just remove all the RLY rewards to come from circulation? If it benefited RLY and CC holders, it would seem reasonable. But then you realize that using the RLY rewards in a smart way is far better then not using them at all, isn’t that the entire reason we have a reward program in the first place? Then you have the fact that this should’ve been a reward to a particular ecosystem, and instead that ecosystem is getting no reward, so you are hurting a specific CC community that could have benefited from their own rewards, to ever so slightly (or not at all imo) benefit the overall community.

“Very important here. The change proposed here is precisely for these users who aren’t logging in each weekend, and have been seeing their gains being scooped up by active traders. This has forced savvy supporters to sometimes painfully sell their CC before the drop to protect their investment in their creator. This is strictly broken.”

We agree the current model is broken, we disagree this is a helpful change. You could easily collect the RLY and then dump the coin. The active trader wouldn’t change behavior at all, and the supporter would still need to sell to prevent the loss.

“Instead, under this system CC holders now realize the gains in RLY. They might miss out on FURTHER gains by not reinvesting in CC’s, but at least they have captured their share and will continue to do so in perpetuity based on their CC holdings. Active fans will almost certainly take this opportunity to use RLY to purchase more of their favorite CC anywhere across the RLY network.”

Money from one pocket and into the other. You could probably make a formula for this. Off the top of my head maybe: old CC holdings = new CC holdings + RLY distribution
The net is the same, the only difference is you sold some of your favorite creators coin and now you can buy it back to have more coin worth the same amount.

“I think it is preferable to create a system where folks are racing to enter a coin at the end of each week than racing to exit under the current system. See above for creating an option to opt-in. I’d also add that for most supporters, this system allows them to maintain or grow their stake, but protects them from a depreciating interest in their creator."

I think it’s preferable to have a system where users aren’t punished for not logging in at a specific time, period.

While we are still in early adopter territory, I think we should continue to optimize the network for supporters above all else - even those supporters that fall into the backers category (to borrow from the user archetypes of supporter/farmer/backer that you outlined in your earlier post). Ultimately, I believe that building a robust network that can incentivize “supporters” is what will determine the success of the platform. To that end, distributing $RLY governance tokens to Creator Coin holders seems like an elegant way to incentivize further platform participation and activity, particularly for supporters. The greater risks of the previous system were clearly manifested for several communities, and so I support this in the absence of a better proposal to incentivize and rewards communities that grow network usage.

I’d like to be clear that I’m not advocating for no change. I’m just advocating for not this particular change. I felt this way about the response to my last post too, so I didn’t bother to follow up. It seems like the developers here are pretty certain they have it figured out, and as much as they ask for community opinions, they don’t seem to hold much influence. I’m not saying I’m guaranteed right either, but it feels like I’m wasting my time to write.

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I know you’ve said you’re disinclined to respond further because your ideas are being dismissed but I’ll try to engage you once again nonetheless. Your specific feedback here is kind of a tough response to incorporate. At the risk of being unfair or diminishing your response, this type of advocacy is effectively asking others to continue proposing alternatives until they land on one you like. Could you instead propose a preferred alternative?

As I see it:

  1. The specific piece you’re advocating against is distributing the rewards as RLY.

  2. The current implementation uses that RLY to purchase and psuedo-burn creator coins. I say psuedo here because a technical burn would release the RLY from the bonding curve liquidity pool while the current implementation leaves those RLY in the bonding curve to the benefit of other participants.

  3. Another alternative would be to purchase and distribute the creator coins.

Both 2 and 3 have the undesirable property of encouraging back running the distribution against the bonding curve to receive disproportionate reward share.

Separate from the distribution mechanism, all 3 benefit from improved timing. Per block would be best but the challenge with per block is that it relies on manual claiming in every implementation I’ve seen to avoid to computational overhead of actually distributing every block. So to avoid introducing a claim and avoid massive/constant delivery overhead, automatic distribution hourly seems like a good balance of improving timing and mitigating delivery overhead without introducing a manual claim.

The only other alternatives I can think of would be ones in which the rewards distribution happens in creator coin (either via creator coin distribution or psuedo burn) while either dynamically modifying the behavior of the bonding curve supporting the continuous liquidity pool or introducing additional locking/vesting to shape user behavior post rewards delivery.

I don’t disagree with any of the reasons you dislike the approach; but I think a similar set of dislikes is present for each of the alternatives I can think of. And considering the relative pros and cons of each, this is where I’m landing and why I’m specifically advocating for this approach. I would happily welcome an alternative that has a superior set of pros/cons but I have been unable to identify one so far

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I think there is a more fundamental misunderstanding, yes. And these would clear up some of the following points you make. It’s about what this proposal solves, and if that is better or worse than doing nothing at all in the short term.
So first, the key distinction here is that prior to this proposed change, folks would jump in and take ALL the community distribution as opposed to “their” share because it went directly to the CC economy where the first to sell post rewards captured the CAR. This exploit has to be addressed and I see this proposal as aiming to do just that, albeit imperfectly, while working towards a complete solution. If we accept that reasoning for this, then I think it sorts out some of the issues. I could be so very wrong with this, but it’s how I understand it.

Now with the change in place, trader will be limited to “their” distribution in RLY instead of the whole movement of the CC with the big purchase, because the CC price remains unchanged post rewards and each fan is given their pro rata share. While the community may not benefit directly, all the community members certainly benefit directly proportional to their “contribution” - even in the scenario here trader comes in and nabs some portion.

Recognizing that this goes half way to a more complete solution that is in the works, I’m in support of it. One might advocate for the alternative option to disable rewards all together until a complete fix is ready (see #2 below), or allow traders to continue on with this exploit. The first option of all these feels far and away better than these in my opinion, because not making this change leaves an unacceptable exploit in place that hurts current communities. With no other proposals in place that address it…I vote for continuing to iterate towards something better.

Second, in terms of the pro rata distribution, according to DFS the next iteration will compute rewards at the hourly level. I saw this in Discord, and it solves most of your issues with this solution though you may still advocating for CAR to be distributed in CC because you feel it will have more positive effects on network usage. Fair enough if so.

Separately, you did not address the idea of having users opt in to have their share of rewards converted to CC in an automated fashion…any thoughts there?

Finally, I think we may discover unintentional benefits to the Rally network by this direct reward to creator fans in lieu of the past system. Consider that fans will collect this from across their Creator coin holdings, and may use this RLY as an opportunity to explore more creators that they never would have sold CC to support. Furthermore, in seeing this RLY in their wallet, they’ll immediately recognize the benefits of participating in a creator coin economy that just wasn’t apparent before to your average fan, since coin prices just change all the time anyway.

I see it as the difference between me telling you that your dollar is with $1.25 now, and me actually giving you a quarter to spend. I think fans will be absolutely stoked. The visibility of CAR for fans was a big issue, and now I’ll be curious if fans take notice in a new way.

I think it will also be fascinating to see and study how CC holders deploy this Rally, and to use that data to further inform network rewards. In short, I see this as an opportunity.

Perhaps most importantly of all

I think it is so important for members of the community like ourselves to feel empowered to speak freely. And I can’t speak for devs, but I value the time you’ve taken to express your thinking here and engage with me as a complete stranger on this topic and project we both find interesting. So again, thank you and I don’t feel that you’ve wasted your time here at all. Engaging this way is how we develop a better understanding of the project, and even grow personally in our ability to engage in these discussions in a positive way. It’s our collective loss if we don’t feel heard and stop engaging.
-Grand

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“Your specific feedback here is kind of a tough response to incorporate. At the risk of being unfair or diminishing your response, this type of advocacy is effectively asking others to continue proposing alternatives until they land on one you like. Could you instead propose a preferred alternative?”

My preferred alternative is to change the reward distribution timing to hourly, since as you explained per block would require a claim function and I agree that’s not a great solution. Hourly with jittered randomness should fix many of the problems, and I’d love to see what the system looks like with just that change.

“So first, the key distinction here is that prior to this proposed change, folks would jump in and take ALL the community distribution as opposed to “their” share because it went directly to the CC economy where the first to sell post rewards captured the CAR. This exploit has to be addressed and I see this proposal as aiming to do just that, albeit imperfectly, while working towards a complete solution. If we accept that reasoning for this, then I think it sorts out some of the issues. I could be so very wrong with this, but it’s how I understand it.”

This is what I was trying to get at with my one pocket to another metaphor. Let’s go through an example: 4 members all own $800 of a $.80 coin. A RLY reward boosts the coin to $1. 1 of them chooses to sell right after the rewards to exploit the system and capture the entire reward for themselves. They sell all 1000 coins, pushing the price down to $0.80, the remaining three people have the same amount of money as before the reward.

Under the new system, each member would have $800 + $200 worth of RLY (It would probably be less RLY because of the way RLY pushes the bonding curve, but I’m rounding my numbers for the example). The one member who wants to run with the profit can now sell all $800 (1000 coins), pushing the price down to $0.60. The remaining members have $600 + $200, or $800 the same as before. But, the remaining individual CC ecosystem will actually have less RLY backing it then before by default, making it harder to consistently grow their economy unless all users are constantly logging in and reinvesting their RLY. So the end result is the same for all users, but slightly worse for the CC.

I’ll revoke this opinion if someone can show me through actual example how the math works out to be more beneficial to everyone given the person selling right away.

“Second, in terms of the pro rata distribution, according to DFS the next iteration will compute rewards at the hourly level. I saw this in Discord, and it solves most of your issues with this solution though you may still advocating for CAR to be distributed in CC because you feel it will have more positive effects on network usage. Fair enough if so.”

Yes, I am a huge advocate of this. Hourly rewards distributions fixes the problem, we don’t need to take the additional measures.

“Separately, you did not address the idea of having users opt in to have their share of rewards converted to CC in an automated fashion…any thoughts there?”

I really like that idea, and support it entirely. If it was turned on by default but users could turn it off, I would be fine with that as a happy medium.

“Finally, I think we may discover unintentional benefits to the Rally network by this direct reward to creator fans in lieu of the past system. Consider that fans will collect this from across their Creator coin holdings, and may use this RLY as an opportunity to explore more creators that they never would have sold CC to support.”

I don’t think this is a good change. You earned the rewards because you were in a specific CC ecosystem, the benefits should mainly go to that CC ecosystem. Especially when you consider that it is necessary to constantly increase RLY holdings to continue to get rewards. If we continue to employ the mentality that rewards should be split across the greater rally community and not maximize benefit to the individual CC ecosystem, I think many creators would choose other ecosystems as they can’t capture all the value they bring in Rally. I’ve talked with a few creators about this, including my fiancee Allie, and they agree. We want to make the system as attractive as possible to a large creator, as large creators will already bring a ton of value to the overall ecosystem as it is.

“I see it as the difference between me telling you that your dollar is with $1.25 now, and me actually giving you a quarter to spend. I think fans will be absolutely stoked. The visibility of CAR for fans was a big issue, and now I’ll be curious if fans take notice in a new way.”

I disagree. As someone who manages one of these communities daily, I see people getting excited about their portfolios increasing, and more so about the coin going up in value. The coin price is a major talking point, and the health of the coin is majorly determined by its price. Having to explain daily why the coin hasn’t moved in a month but “hey, at least its generated some amount of dividends that got spent around the rest of the rally ecosystem” doesn’t sound like fun for me. Most people don’t invest in dividend stocks or understand that value and the few financially savvy people who do will probably realize like I do you aren’t gaining any value, you are just shifting your value from one pocket to the other.

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Thanks for your response and continued discussion on this. Let us recognize that in both these examples, there’s an assumption that the agent had already purchased the coin. I think there’s a fundamentally different challenge and question of disincentivizing early adopters/supporters from exiting a coin vs. a bad actor jumping in last minute to capture rewards and exit. I don’t think the distinction is too important for the purposes of this debate.

In both examples, we recognize that the bonding curve design is such that each creator coin brings incrementally more RLY backing a CC economy. Each withdrawal similarly takes out more RLY than the following.

In the first example, by exiting after the rewards drop with all 800 coins they ensure that the maximum amount of RLY has been withdrawn from that creator economy. They’ve done the most damage possible. Whether the bad actor here joined last and brought the coin from .6 - .8 or joined earlier isn’t the biggest issue.

If in your second example, the agent exiting drops the coin from .80 to .60, then that same agent was responsible for bringing it from .6 to .8 with their 800 coins. Again, regardless of their entry point (last minute or earlier on), they only exit now with 25% of that community’s rewards.

This agent, motivated to maximize their gain, will take 100% or 25% your community rewards. I’d argue that they are entitled to 25% as part of the community (very important caveat that this only applies when proper time based vesting of rewards is active). Again, operating here on working towards the best system. Everyone holding CC is entitled to an equal share, and the system is evolving to better align that with time based rewards and so on. But returning to this scenario, you now have 3 fans holding 75% of the rewards in RLY. We should expect their propensity to add it back in to be high and introducing an automated way to reinvest to increase this. I think you’d argue it belongs to the community, and I would reply that the community is an aggregation of the holders.

Here’s the most important part - the creator is the largest holder of CC in their economy. These examples don’t capture that. In the first example, agent made off with 100% of the gains, yet in nearly every existing CC economy now, the majority of the rewards will now go to the Creator. Now the creator will have MORE control, and more agency in determining how to distribute their communities rewards since they personally have captured the lion’s share. This resonates with Rally’s core mission and how it intends to empower Creators.

That’s how I see it, and it is good to hear your insights on a specific community and I hope there is a channel for Creators to share more of this with fellow creators and the core team beyond this forum! There are some real challenges around coin prices given RLY volatility and Bonding curve designs that I think will improve as the project matures and gains wider adoption, but I see the proposed solution as a viable option for preserving rewards for communities and in fact empowering Creators.

The last disclaimer is that I’m just working off your math here and the calculus is likely more complicated, also that an early adopter can capture somewhat larger share than the RLY they put in for the CCs depending on their entry point, but that this proposal goes a long way to protecting communities from those coming in last minute.

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It’s still the same thing regardless of when they entered. They take the same amount of the reward, you are just analyzing it in your head differently. You give someone 20 $1 bills, or you give them $20, it’s the same thing. You aren’t getting more because there are more bills. It’s a silly argument but it’s the same thing. Whether you give the reward in RLY or in CC, the person runs away with the same amount of value if they jump in last minute and exit immediately after. We fix this with distribution timing, not with the RLY distribution. Let’s change the timing and not the CC distribution for the many reasons I’ve stated previously.

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But the pro-rata distribution isn’t giving someone 20 1$ bills - it’s giving 20 individuals 1$ each. And while $'s don’t appreciate, additional CC to the curve does and allows the bad actor (or first seller) to capture that appreciation instead of the community. The fundamental difference is that RLY or CC aside, the distribution directly to individuals can’t be stolen by a single bad actor. Period. As it can be under current design. Some folks wouldn’t ever jump in if there wasn’t this promise of rewards - and they won’t in the future when this is fully patched. What this does now is preserves the rewards, albeit in a distribution you remain unsatisfied with. And that’s a fair disagreement.

Look, I don’t want to go on here on this subject. What I will add is that elsewhere in the forums I’ve mentioned that if any community felt that they were exploited by some of the flaws we’ve been hashing out here on the network design, that I think many would certainly hear out a petition to make it right by that community. Particularly if there’s ample evidence of harm done, and you may want to propose a fund from the treasury to compensate those communities in some form. I’m curious how the Rally voting community would respond. Others might say it’s simply doing what a rational financial actor would do, though I would argue it’s up to the community to decide.

Creators put a lot on the line as early adopters of Rally and the success of the platform is riding on them 100%. There’s a lot of risk to bringing in their communities to this growing space and a lot of time and energy educating their fans. This might not be the case for Allie’s community, but regardless it’s something I’ve considered but putting it out there again in case there’s a creator that wants to run with it. I also don’t know if the first round of creators received any special considerations to compensate them for the potential risks they’ve taken on, and I can imagine compelling reasons to not go down this road and stay focused on improving things moving forward. Just wanted to remind that the community is listening and available here, at least when we aren’t busy with our real jobs!

Anyway - good discussion and best of luck with your community!

Peace,
Grand

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this is only true if the bonding curve slope is constant (i.e. straight line). since we’re on a curve where that slope could be increasing, the total value that person receives is not the same between the two delivery methods. with potentially increasing slope, the user could extract more value if rewards were delivered as liquidity in the bonding curve increasing creator coin price than they could if rewards were delivered directly to their account pro rata. in your 4 user example and the $20 bill you mention – it’s not so much a $20 bill vs 20 $1 bills as it’s the difference between setting a $20 bill on the table and allowing each of the 4 users to race for it winner take all with the others left out vs. just handing them each a $5 bill.

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Isn’t there an inflection in the bonding curve? What if we are at a decreasing point of the slope, then the RLY rewards method is worse. I guess your argument will be most creators are still on the upward slope. I wonder how much worse the CC version is than RLY distribution even at the worst part of the slope.

In any case, these problems are much more easily addressed with the hourly timing. So at that point how do you weigh the cost of the slope adjustment vs all the other costs I’ve mentioned previously. At the very least can we put this SPECIFIC change up to a community vote. I’d like to see if the community would vote for the change if it isn’t bundled together with other changes we all want.

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i guess to be clear i was speaking to the specific construct of your example. whether the user choosing to sell receives more, less, or equal amounts of the liquidity + rewards made available in the two methods is dependent on:

1 - their percentage ownership of the coin
2 - the magnitude of rewards delivered
3 - the magnitude of supply change caused by the rewards delivery

the changes in slope are what allow the above 3 elements to create non equal values between delivery via CC vs delivery vs RLY but the magnitude and direction of the difference is dependent more on the factors above than the slope change itself.

at any rate, splitting the proposal in two and isolating the delivery piece (liquidity behind cc or pro-rata to holders in RLY) to it’s own separate proposal works for me.

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Nice one keep up the good work

1 Like
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I like this idea of splitting up the proposal to get a clear signal on just the distribution method.

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Hopefully, this is the right place to bring up this topic, I have been an avid member of the community since January and have been fascinated by the work being done here. I just wanted to talk a little about my experiences being a liquidity provider for the network.

I find it interesting that one of the sacrifices made while providing liquidity to the rally network is that of voting power. While the price hike today was profitable overall, I found myself losing around 30% of my total staked rally, which resulted in about a 15% loss of my current voting power.

I have been enjoying throwing in my vote, however small, to help contribute to the governance platform. It is a great feeling to play a part in building this community, so providing liquidity and voting has been my go-to method to help where I am capable.

Seeing what voting power I have begin to decrease was disappointing, though I am by no means upset. I am glad to see Rally grow and succeed, I just wanted to bring to light a possible unintended disincentive for staking a large portion of one’s RLY into the network.

From what I have read in the forums, liquidity provider pools seem to be the lesser talked about topic in the discussion of evolving the rewards programs for the community. I was wondering if there were any plans to address the eventual increase in impermanent losses, leading to a decrease in voting power for LP’s, as the market grows. I am not the most technically savvy person, so I wanted to bring it up to you all and see what your thoughts on the matter were.

Thank you,
Rain

2 Likes
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@RainRaith LPs should be greatly improved with the release of Uniswap v3. Greater returns & less impermanent loss.