This is the third of four parts of a community drafted proposal that originated from Discord chat and being moved here-
Purpose: The goal of this proposal is to further align the interest of the stakeholders (capital provider, cover buyers, liquidity provider) and the DAO as a whole by encouraging long term stakeholders. We would like to encourage and attract long term capital and liquidity providers as well as provide additional value and utility to long term stakeholders in USF.
Staked USF (sUSF) vote in a gauge to allocate/incentivize coverage volume offered, on a per-risk-pool basis, to one of the policies within that pool. This shall be done in a manner that keeps the risk of the pool unchanged. Two ideas
- Either the volume of coverage that can be bought for a specific project is limited to a certain % of the pool. The Gauge vote can raise that ceiling, by a % depending on the vote result
- Or, a discount on the premium for that policy. This may be a more advantageous solution for everyone (cheaper premium for user and more volume for the DAO)
This will increase the utility of the USF token, and align the interest of all parties. Projects benefits from advertising additional security for their user. As a result, they will buy USF to vote in gauge (and they will keep accruing rewards and fees in sUSF like anyone else, as well), in order to make it easier/cheaper for their users to buy coverage.
Initial feedback on this from Marh- The gauges in Curve’s case are used to incentivize pools.
In our case we have 2 levels:
- Pools for cover buyers and per pool/policy limit in a bucket
- Buckets themselves and the incentive for capital miners