[TEMP CHECK] Safety Module Upgrade Part IV - Incentives Management Upgrade

Hey @John_TV_Locke, thanks for the feedback !

2% is not a target, it is the current estimated cover with the new design if the SM was insuring 100% of the Aave TVL (which is not currently the case)
With the market conditions, this number is currently slightly below 2% and will evolve quite often.

Interesting data, thanks for sharing !
We know that reducing the yield for StkAAVE could lead to a reduction of the TVL (which is not an issue if compensated by other categories) and for this reason we accounted for a 30% drop.

As for the volatile & stable LPs, note that your data don’t take into account stables & pegged LPs, which will considerably reduce the impermanent loss risk and could contribute to depositors being more risk adverse.

Additional estimations can definitely be done by reducing the TVL targets to improve the smBPT APRs if the range proposed for volatile BPTs seems too low.

We believe this strategy should start with a trial & grow the incentives progressively to easily finetune/update the distribution whenever needed.

It depends on several parameters such as the price per vote, the assets bribed, the amount of votes required, the veBAL voting supply etc but yes it is possible to attract a good amount of votes with the current budget, which is a great solution until the DAO increases its strategic voting power capacity.

No the max boost isn’t guarenteed on Aura, but all ours estimations are on the base APR (i.e without boost) so even 1.5x boost is great and better than what can currently achieve the veBAL held by the DAO.

This answer was co-written with @TokenLogic.