Increase rETH/WETH (0.05%) v3 Gauge Cap to 10% [Ethereum]

[Uisce]

Overview

The Rocket Pool Incentive Management Committee proposes increasing the rETH/WETH (0.05%) gauge emissions cap from 5% to 10% on Ethereum mainnet.

The existing cap has been reached and we believe raising it would provide a promising opportunity for further growth of TVL and volume.

Protocol Background

Rocket Pool is a permissionless, non-custodial and highly decentralised ethereum staking protocol. It reduces the minimum amount of required ETH to launch an Ethereum validator from 32 ETH to 8 ETH by matching node operators with ETH deposited by stakers in the pool. These depositors earn staking yield on their ETH while maintaining liquidity and the ability to utilise the liquid staked ETH in the DeFi ecosystem. As the premiere permissionless & decentralised option in the space, Rocket Pool enjoys a large and passionate community of enthusiasts.

rETH is the liquid staking token (LST) issued by the Rocket Pool protocol. rETH is a value accruing token – as staking rewards accumulate over time the value of the rETH token increases relative to ETH.

In addition to normal trading fees, rETH continues to accrue staking yield while being used for liquidity provision making it a natural fit for liquidity providers seeking additional yield.

Audits
Rocket Pool has received extensive security audits from Sigma Prime, Consensys Diligence & Trail of Bits, reports can be found at https://rocketpool.net/protocol/security
There is also an ongoing bug bounty program with Immunefi for up to $500,000.

Oracle
Chainlink oracle: rETH / ETH | Chainlink

Motivation

At the time of writing the rETH/WETH (0.05%) Pool has a TVL of 9.7M and a 7D Volume of 24.28M, it represents an important part of rETHs concentrated liquidity strategy.

As using rETH naturally provides additional yield over using simple WETH, we hope to see increased adoption across a variety of different token pairs (eg, rETH/WBTC) and having additional rETH/WETH depth will help make routing through these pools more attractive within PancakeSwap.

An increase of the gauge emissions cap from 5% to 10% should be mutually beneficial to both holders of the rETH token and for the growth of PancakeSwap on Ethereum.

Resources

rETH Contract: 0xae78736cd615f374d3085123a210448e74fc6393
Pool Address: 0x2201d2400d30BFD8172104B4ad046d019CA4E7bd

Website: https://rocketpool.net/
Documentation: https://docs.rocketpool.net/

Github: https://github.com/rocket-pool
DAO forum: https://dao.rocketpool.net/

Socials
Discord: https://discord.gg/rocketpool
Twitter/X: https://x.com/Rocket_Pool

[Juapia]

I agree. IMO, it is in line with the benefits for pancakeswap and cake holders. Rocket pool is an important protocol on the eth. And it is interesting for the pancakeswap community to increase the volume and ties in this network. Lets do this! But one question, do you have any prospects of distributing some bribes/vote incentives?

[sparkes25]

Increasing the limit would increase the amount of CAKE going to rETH-ETH holders, but wont add much benefit to pancake.

[Uisce]

Hey @Juapia , thanks for the positive response.

Regarding your question,
The Rocketpool DAO has been providing RPL incentives to encourage the growth of rETH liquidity on PancakeSwap since the end of May, previously these were directed to stakers in the syrup pool.

More recently, RPL token incentives are being directed towards liquidity providers in the rETH/WETH pool via a distribution on Merkl.

While we can’t lock ourselves into any specific approach ahead of time, the incentive committee will continue to examine all options for attracting additional liquidity including the possible use of veCAKE vote markets.

[Juapia]

great! Thanks for the infos. I think all users can find out more now and make a well-informed decision. I think this proposal is even better for caker holders now!

[cheficy]

Previously rETH-ETH was close to the 5% cap but users may have re-allocated votes. So thankfully this isn’t super time-sensitive – @ChefMaroon let’s add this to the next community gauge proposal

[ChefMaroon]

Thank you for your application! The Kitchen has increased the rETH-ETH (0.05%) v3 gauge on Ethereum from 5% to 10% due to its historical TVL and volume performance.