The proposal is to create a new FOX Regen Farm to keep incentivizing liquidity on Gnosis Chain and reward token holders who are supporting the FOX economy.
The FOX-HNY Regen Farm liquidity mining program will finish on October, 2nd. The FOX Regen Farm gives token holders the opportunity to earn rewards for providing liquidity in FOX and Honey and supporting the FOX economy on the Gnosis Chain.
The first iteration of the program successfully attracted $286,624 USD in FOX liquidity on HoneySwap and incentivized token holders to hodl FOX through the downturn of the market. In the incubation phase of this proposal, the signal is to continue with the Regen Farm program.
Hence, this proposal is to create a new FOX Regen Farm for the next 6 months (3rd of October-2nd of April) for the FOX/xDAI pair.
- Increase the liquidity of the FOX token on Gnosis Chain to keep up with the overall growth of the FOX economy on this chain.
- Continue rewarding both liquidity providing and holding of the FOX token.
Currently, there is $286,624 USD in FOX liquidity on HoneySwap, incentivized by the FOX Regen Farm on Gnosis Chain. FOX liquidity and number of holders has grown steadily, reaching a circulating supply of 7,930,246.57 xFOX on 08/24/22 and 1115 token holders. Find here other relevant stats.
This is an effective and tested solution to increase liquidity on the Gnosis Chain, incentivize holding FOX, minimize sell pressure, keep farmers invested in the long term, and require minimal bandwidth from the FOX team.
In the incubation phase, 3 options were suggested to the extension of the Regen Farm program. (1) to terminate the FOX Regen Farm, (2) to maintain the HNY/FOX farm and top off the rewards or (3) to create a new WETH/FOX or XDAI/FOX farm to pair the value of FOX with ETH or a stablecoin. The result was a strong signal to extend the Regen Farm program and soft signals with respect to which token would be the best to pair it with. I’ve seen interest in pairing it with xDAI and am submitting the proposal for xDAI, however would love to hear the community’s opinion on this during the ideation phase.
Regarding the rewards to be allocated, there is interest in growing the liquidity 2X or 3X. Therefore, I will add a poll to get a signal from the community on the number of tokens to be allocated to the Regen Farm program.
Giveth is requesting 5,000 USD and 2% of the FOX rewards to cover the costs of configuring and deploying the farm contracts. Half of both fees would go to the matching fund project on Giveth and the rest to the DAO treasury, where it could potentially be paired with GIV to provide liquidity to both DAOs)
What is a Regen Farm:
In a nutshell, Regen Farms is a liquidity mining solution that Giveth created to get deep liquidity after its airdrop & keep token holders invested on the long run by streaming the rewards over the next 5 years. Soon after, @willy actually noted that this would be a sweet tool for other DAOs like Shapeshift and this is how Shapeshift became the first DAO to create a Regen Farm
- ShapeShift governance process to pass the proposal to Create a New Regen Farm.
- Giveth governance process to Create a New Regen Farm for Shapeshift.
- Final parametrization of the Regen Farm.
- ShapeShift transfers FOX rewards and 5,000 USD to liquidity.giv.eth.
- Giveth team takes care of the setup.
- Giveth transfers ownership of the distribution to Shapeshift.
- Gain liquidity by crowdsourcing liquidity from token holders who will pair up FOX & xDAI in a liquidity pool.
- Incentivize holding FOX. Align the incentives of token holders and the DAO with an outstanding investment opportunity (~75% APR).
- Streaming rewards. This favors liquidity providers that want to be exposed to FOX in the long term & keeps them invested in the DAO in the long run by streaming the rewards over a period of time (you choose the length up to December 2026). This also mitigates sell pressure for FOX.
- Ready-made UI/UX & development support. All Shapeshift has to do is decide the parameters, supply the reward tokens & be in the loop in coordination with our team.
- Tested solution. We already have been using Giveth Regen Farms for the past 6 months and it has worked like a charm.
Bonus: half of the service fees go to donations to fund public goods!
- Cost. Some of the rewards may be farmed by people not aligned with the FOX economy and dumped. It’s worth mentioning that reward streaming mitigates this drawback.
Should we create a FOX/XDAI Regen Farm?
How much should we allocate in rewards for the next 6 months?
- 375k (similar to last time)