Proposal: Make a stability fees and distribution reward for minting VAI

Venus Governance
1

The main use of VAI is circulation, not minting it then just to stake it in Venus to get the staking reward.
If the most of minting VAI didn’t participate in the circulation, then we didn’t need this minting VAI function.

Regulation：

If 24 hours TWAP of VAI Price Oracle rate: VAI/BUSD rate<0.98, charge stability fees from the users who mints VAI;

If 24 hours TWAP of VAI Price Oracle rate: VAI/BUSD rate>1.02, distribute reward to the users who mints VAI;

If 24 hours TWAP of VAI Price Oracle rate: 0.98<=VAI/BUSD rate<=1.02, no fees no reward.

  1. Make a 24 hours the time-weighted average price (TWAP) of VAI Price Oracle (VAI/BUSD, VAI/USDT, VAI/USDC) to determin charging stability fees from the users who mints VAI or distributes reward to the users who mints VAI（every debt will withhold APY 30% stability fees first in each block, after settled actual fees every day then return the rest？）;

  2. The distribution reward will come from the stability fees;

  3. The fees rate will follow the 24 hours TWAP of VAI Price Oracle rate;
    Just Example:
    If TWAP is 0.85, then the APY of stability fees is 15%;
    If TWAP is 0.80, then the APY of stability fees is 20%;
    The highest APY of stability fees<=30%?

  4. The APY of distributing reward:
    If TWAP >1.02, the APY of distributing reward was determined by the staking fees vault, VAI amount and TWAP.
    The APY of distributing reward will follow the TWAP:
    If TWAP =1.04, the APY should be less than or equal to 4%;
    If TWAP =1.06, the APY should be less than or equal to 6%;

  5. The APY of staking VAI:
    The APY of staking VAI should be less than the average supply APY in Venus.

thoughts？

2 Likes
2

The APY of staking VAI should be less than the average supply APY in Venus.

Must charge stability fees from the users who mints VAI.

3

In fact, this APY paid for locking VAI helps the VAI price to be pegged to 1 USD I think. The problem here is that there is no liquidation/fees for borrowing VAI. That should be resolved with the upcoming proposals

4

Yes, it has some help, but if didn’t have stability fees, then this APY didn’t have very much help to peg.

Hope the stability fees can be implemented asap in the future proposal.

1 Like
5

Yep we need this A.S.A.P but the team seem lackadaisical