| id | Title | Status | Author | Description | Discussions to | Created |
|---|---|---|---|---|---|---|
| TIP-97 | Rewards Buckets modification for Thales Marketplace Trading Incentives | Implemented | padzank (@padzank) | Change Rewards Buckets for Trading Incentives to pro-rata rewards for ITM Buy Volume, OTM Buy Volume and Discounts Buy Volume | https://discord.gg/rPpPcMXSeU | 2022-10-17 |
This TIP proposes to modify Trading Incentives for the Thales Marketplace by introducing reward buckets of Buy Volume of positions that are In The Money (Current Asset Price is in favor of the position on time of position purchase), Buy Volume of positions that are Out The Money (Current Asset Price is not in favor of the position) and Discounts Buy Volume, to replace the currently set up buckets.
Currently, the Trading Incentives rewards are rewarding traders in four separate buy volume buckets which are: UP token, DOWN token, Ranged Markets and Discounted Tokens Buy Volume. This TIP proposes to more effectively push for balancing the AMM by optimizing the incentives further by introducing a new system of awarding In The Money token buyers, Out The Money token buyers and Discounted token buyers equally.
This TIP additionally proposes to prolong the Trading Rewards incentive program for additional rounds (2 weeks) after the regular 7th round is ended. This means that the Trading Incentive rewards will last until November 16th 2022..
The new emissions are to be as following:
- 5,000 OP + 7,000 THALES pro-rata towards In The Money token Buyers
- 5,000 OP + 7,000 THALES pro-rata towards Out The Money token Buyers
- 5,000 OP + 7,000 THALES pro-rata towards Discounted token Buyers
The goal of splitting Trading Incentives program to 4 pro-rata buckets of UP, DOWN, Ranged and Discounts buy volume was to organically balance the AMMs market exposure. If a certain bucket is overbought, the rewards will be higher for the underbought bucket meaning that traders are incentivized to balance the AMM. However, the effectiveness of the initial distribution was not sufficiently optimal in that goal because the effect was highest rewards for traders buying ITM options (Current Asset Price is in favor of the position on time of position purchase). This way, the rewards are not effective at balancing the risk in times of low volatility markets. To achieve global AMM balance, a more optimal approach is to have balance between ITM and OTM buying across the board.
By introducing the buckets that will incentivize organic balance between buyers of positions that have Current Asset Price in favor of the position and buyers of positions that have Current Asset Price not in favor of the position while also incentivizing Discount buyers to bring in even more balancing impact, the AMM should be balanced to a much greater degree with a much larger organic impact.
This TIP entails the Thales Treasury DAO to allocate additional 15,000 OP and 21,000 THALES tokens towards continuation of Trading Incentives program for additional 2 weeks after the current program ends.
This TIP additionally entails the Thales Treasury DAO to continue the rewards distribution for Trading Incentives program under a new model with the following details:
- 5,000 OP + 7,000 THALES pro-rata towards In The Money token Buyers
- 5,000 OP + 7,000 THALES pro-rata towards Out The Money token Buyers
- 5,000 OP + 7,000 THALES pro-rata towards Discounted token Buyers
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