Latest Governance Proposal Now Live!
Proposal to Introduce Liquidity Mining for AVT on Uniswap
Proposal Overview
This proposal requests 9000 AVT from community treasury to introduce a liquidity mining program to the Aventus Network in order to incentivize users to provide liquidity to decentralized exchanges by rewarding them with additional tokens.
It is based on the recommendations made by MVP Workshop as part of the Aventus 2.0 token redesign project (see Aventus 2.0 Tokenomics Report).
How it Works
Currently, most AVT tokens are traded on Coinbase (over 90%). To diversify this risk, it is necessary to distribute the volume across multiple exchanges.
However, creating a new pool on a decentralized exchange represents a cold start problem. It is necessary to create a framework which incentivizes liquidity in order to create a self-sustaining flywheel effect where incentives attract liquidity, improve price execution, and increase volume market share.
As AVT is listed on Coinbase, a major centralized exchange, this proposal is for a liquidity mining program on Uniswap, a major decentralized exchange where AVT is already listed. Given most tokens on Uniswap have a pool for the ETH token, this liquidity mining program will run for the AVT/ETH pool.
Based on research and analysis conducted by MVP Workshop, this liquidity program will last three months, and be phased in gradually up to a desired incentive level of 4000 AVT per month.
Rewards for this initial pilot test are currently planned as follow, but may be amended as needed to optimize the scheme:
- First month: 2000 AVT
- Second month: 3000 AVT
- Third month: 4000 AVT
The total cost of the liquidity mining program would therefore be 9000 AVT. To achieve a large volume, it is not enough that only the TVL is high, but it is necessary that the token swap fee is small, i.e. 0.05%.
Following the conclusion of the liquidity mining program, the liquidity providers will have the option to keep their pool.
Finally, while there are existing solutions that can be leveraged for the Aventus liquidity mining program (the most obvious solution being provided by Etherscan), these solutions are generally complex, with multiple steps and poor user experience. As such, if this proposal passes, Aventus Services has committed resources to develop and deploy a custom dApp for the Aventus liquidity mining program.
Benefits to AVT Community
Providing liquidity triggers a positive feedback loop, i.e. creating a self-sustaining flywheel effect, where additional incentives attract liquidity, improve price execution, and increase volume market share.
Research and analysis conducted by MVP Workshop indicates that similar liquidity mining programs have produced sustained improvements to total value locked (TVL) and market share even beyond the duration of the incentives, suggesting that such programs can create a foundation for long-term growth and stability.
If this Vote is Approved
If this vote is approved, 9000 AVT will be used from AVT community treasury to fund rewards for liquidity providers.
Aventus Services has committed to set up the liquidity mining staking program on behalf of Aventus Network for the benefit of AVT holders, and develop a custom dApp for a seamless user experience.
The Aventus Network marketing team will ensure that the community has access to sufficient education on the benefits and risks of liquidity mining, as well as instructions on how to take part in the program, via written blog & social media content, AMAs and video tutorials.
MVP Workshop Aventus 2.0 Tokenomics Report
Analysis of Uniswap Arbitrum Liquidity Mining Program
How to Vote
Please note that if you have staked all of your AVT on the Aventus Mainnet, you can still vote by using the Aventus-compatible governance platform.
To vote on this Aventus Network governance Dapp:
- Go to https://voting.mainnet.aventus.network/
- Ensure you have the PolkadotJS browser extension installed on your browser.
- Click on “Connect Your Polkadot Wallet”
- Once your wallet is connected, click on the proposal you want to vote on.
- Choose the option you want to vote for.
- Sign the voting message.
Vote weight:
- 1 vote per AVT
To vote on Ethereum (via Snapshot):
- Go to gov.aventus.network.
- Click on the “Connect wallet” button in the top right corner. You can vote using any of the five compatible wallets supported by the platform.
- Connect with the wallet provider that you used to stake your AVT or where you hold your AVT.
- Click on this proposal to vote on it.
- Choose the option you want to vote for.
- Sign the message via your wallet.
Vote weight:
- 1 vote per AVT
