I’m strongly against the proposal for a few reasons:
-
It doesn’t make much sense to incentivise migration → this will set a bad precedent where every time a new version of the protocol comes up, LPs will expect some sort of incentive before they migrate. Rather, the new version should be “so good” such that liquidity providers will want to migrate to take advantage of the new protocol.
-
stAAVE distribution does not really help incentivize long-term holding as 10 days is way too short and cannot possibly be considered long term in anyway. SNX escrow period is 1 year, and Sushi swap liquidity mining vested 2/3rds of the rewards after 3 months.
-
Running liquidity mining programs after the protocol has been live and successful for such a long-time feels like a step backwards, especially if the plan is to incentivise the current existing pools which are working along just fine. There is a reason why uniswap themselves decided to stop their liquidity mining program, and yet their growth is coming along just fine.
I think it will make more sense for the protocol to focus on bridging to real-world assets, and perhaps giving out AAVE to incentivise people to build out peripheral protocols that connect AAVE to real-world assets.
As an aside, a more effective liquidity mining programme would to just incentivise the demand side (so we can give out half the amount of tokens). Incentivise demand will push up interest rates sky high, and supply will follow. This is way more effective than compounds liquidity mining programme. If we were to incentivise demand and supply, that would kind of be like an Curve giving out governance tokens to people who make swaps on the protocol.