Modified by: [pending FIP number]
I propose the implementation of a 20% ragequit function (similar to FIP -196) for the FRAX/DAI Gelato Uniswap Pool to address the needs of community members who wish to re-allocate their capital.
Implementing such a function represents a negligible risk to the protocol as the pool barely has any trading volume since May 2022. Furthermore, the TVL of the pool has only decreased since April 2022, leaving the pool currently at ~$2.9M TVL. Both facts highlight that the pool has had minimal adoption, making it an ineffective and non-productive way to direct capital.
With a 20% ragequit fee, community members will be allowed to exit their position and direct their capital to more productive avenues.
It is important to note that the Gelato network no longer looks after G-UNI pools as it was spun out into Arrakis Finance. There have also never been additional incentives for the gauge from Gelato’s side.
- For: Implement the ragequit function for the FRAX/DAI Gelato LP pool with a 20% fee.
- Against: Do nothing
While we appreciate the effort to improve our protocol’s governance, we believe this proposal is not in the best interest of our ecosystem. We value the importance of maintaining locked liquidity, which serves as a crucial factor in the stability and resilience of our protocol. We understand that a 20% ragequit function may offer a tempting opportunity for a short-term profit, but we firmly believe that long-term sustainability should always be our top priority.
Frax Core Team
Hey @amirnader could we come back to this proposal? I see no legitimate reason why it never actually went up for voting.
I believe in the current situation implementing a 20% ragequit function on this stable/stable pool is actually a win-win for the protocol as we attempt to reach 100% CR for FRAX. The gelato pool has only $2.9M locked liquidity, outside of the Gelato pool we still have another Uniswap FRAX/DAI pool with $16.9M locked liquidity which means we have a total of $19.8M FRAX/DAI liquidity present on Uniswap. In my opinion, even without the Gelato pool, 16.9M FRAX/DAI liquidity is more than sufficient considering the volume that pool actually sees on Uniswap. The last 24H volume on this pool was $10K. Live stats can be seen here: Uniswap Info
I believe the opportunity here for the protocol to make a potential ~$600K (which can be used towards raising the CR) far outweighs any potential negative impact (there really is none?) unlocking this small 2.9M TVL pool could have. It’s Important to know that the 2.9M Pool is only locked for another ±500 days anyway.
So the case is really:
Keep 2.9M of idle FRAX/Dai liquidity locked for ±500 remaining days and earn nothing.
Implement Ragequit to potentially earn $600K to be used towards raising the CR.
I’d also like to note that this is one of the very few pools remaining where a ragequit function can even be implemented. The newer pools don’t have the migration function coded in so there isn’t any need to worry about setting a bad precedent either. I think we should take advantage of this opportunity to give the protocol a chance at making a nice amount of profit while we still can. Especially at a time where we are trying to get to 100% CR asap.
Agree with you @FraxiG, I believe there is sufficient liquidity outside of the Gelato pool that barely receives any trading volume.
This proposal is up for voting here: Snapshot
Hey, thanks for this! I see the vote has successfully passed. What are the next steps?
It is on the to-do list of the core team to implement. Probably it will be available in less than 2 weeks.