AELIP-31: Deal Fee Rewards

Author
StatusApproved
ImplementorTBD
ReleaseTBD
Created2022-08-10

Simple Summary

This AELIP proposes to provide deal fee rewards to stakers prior to the AELIP-14 buyback and distribution mechanism going into effect. The proposal is to use a proportion of the initial buyback for AELIP-14 and distribute it to historical stakers in pool 1 and pool 2.

Abstract

Looking back, pool 1 and pool 2 stakers received inflationary rewards but no deal fees. Pool 1 is supposed to receive 2/3 of the deal fees and 1/3 of the deal fees. With AELIP-14 however, instead of distributing fees, AELIN from buybacks will be awarded. The proposal is to take 50% of the AELIN rewards from the initial buyback happening in the future and to create a merkle tree distribution to historical stakers for them to claim.

From the launch of pool 1 until the initial buyback, 2/3 of the AELIN in the merkle tree distribution will be awarded across the period proportionally, and from the launch of pool 2 until the start of VELO rewards the other 1/3 will be distributed across pool 2 stakers.

Motivation

The goal is to reward those who are staking in pool 1 and continue to stake in anticipation of future buyback rewards as well as this historical distribution, while also rewarding prior stakers in pool 2 who were told they would get deal fee rewards, but have not as of yet.

Specification

Overview

During the initial buyback 50% of all AELIN will go to a merkle tree distributed to historical stakers. Out of this 50% amount, 2/3 will be given to pool 1 and 1/3 will be given to pool 2.

From the launch of pool 1 until the initial buyback, awards will be given proportionate to ownership percentage of the pool over time. Same goes for pool 2, but pool 2 calculations will stop at the point of the initial VELO rewards, since pool 2 rewards ended at that point in time.

Rationale

Since the distribution rewards historical activity and not future staking activities it makes sense to use a merkle distribution instead of a StakingRewards contract. Future stakers will continue to be rewarded under AELIP-14.

Technical Specification

The same merkle distribution contracts for the initial AELIN pool will be used again for this distribution and will be put in a claim page in the UI.

Test Cases

n/a

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