On January 3rd, the currently active 4-weeks reward period for Balancer WETH<>wstETH LP will expire. This proposal is to extend the rewards for one more 4 weeks period in January.
Over the past months, the pool has been incentivized with 300,000 LDO per 4 weeks with BAL incentives on top of it. The newly started reWARDS Committee will include the Balancer pool incentives into the January rewards budget and introduce the incentivization plan in its entirety within a few days from now.
The current pool performance looks relatively satisfying overall, the pool is still the deepest LP on Balancer and the 6.5% APY provides a good farming alternative to the Curve stETH<>ETH LP. Balancer LDO incentives perform similarly to Curve incentives in terms of LDO spent per WETH per month and LDO/wstETH per month.
If there’s no controversy over this proposal, the Balancer reward program will be replenished using the Easy Track motion in the coming week.
I have no objection to continuing with the same reward amount for now given the various moving parts with Jan budget and reWARDS committee, but this pool is one where it may make sense in the future to reduce the inventive amounts if the lower trading volume per unit of liquidity continues.
Also on a tangent, what do you think causes the stETH/ETH price in this pool to be consistently lower than in others?
For reducing the incentives for the Balancer pool – this makes sense to me as well, and I believe the options should be covered in the upcoming reWARDS Committee monthly report. One reason why I would probably wait for one more month with these changes is not to interfere with the Curve liquidity shift if we choose to try convex/votium bribes in January.
For price in the pool, I think we should keep in mind the Balancer pool isn’t stETH but wstETH based. What are the calculations you make to see if it’s cheaper to buy stETH in this pool?
Yes, this was my thought also. And re price, you’re right that I was comparing apples and oranges, or stETH prices to wstETH prices as it were…
ETH pairs exist less for facilitating fair-weather trading and more to soak up all the volume which comes with price turbulence, and most of all liquidations. It shouldn’t be judged on the same merits as stablecoins pairs.
We want it to hold when this happens:
Is it APY or APR? Looks like APR. Also does it include staking rewards on ~half the assets? I think it doesn’t.
It is actually an APR, and I believe it does include stETH staking rewards: