Initial discussion: AAVE reserve emission for safety and ecosystem incentives

Hello all,

Here is my attempt to consolidate the discussion. As Liquidity Incentive will start after the Staking and with the launch of v2, this proposal focuses solely on the Safety Incentives (Staking reward).

  1. The AAVE emission for safety incentives will be set for the first quarter, and re-evaluated each quarter

  2. An initial AAVE emission of 400 AAVE/day for the first weeks until the slash is activated should be enough to incentivize migration and plain Aave staking in order to bootstrap the initial liquidity and gauge stakeholders interest in staking.

These steps describe how the deployment and activation of the different parts of the Safety module will move forward:

  1. Deployment and activation of the Aave Staking in the Safety Module (Without slashing)

  2. Balancer Pool Staking and start of the Aave/ETH incentives

  3. Activation of the safety module functionality which includes slashing and protocol coverage against shortfall

Each of those steps represents different risk level and should be incentivized accordingly when the times comes, for now we need to vote on the incentives to migrate & stake Aave for the step one.

Next steps would be to vote on the reward for Aave/ETH balancer staking and the level of reward once the slash starts.

The offchain signaling tool developed by Balancer is being adapted to let the community signal their approval of this proposal offchain. If the signal is positive, an AIP will be created to implement the proposal and move forward with the on-chain vote, token migration and activation of the step 1 of the safety module.

TL:DR

Off chain signalling then vote on the token migration and initial incentive to stake Aave, before adding Balancer stake incentive + Protocol coverage

7 Likes