Proposal to Redirect Emissions for Ecosystem Growth

Governance
1

The vote proposal can be found here. Please comment below if you have any feedback or questions about the proposal.

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To enhance activity and growth across our upcoming products in the PancakeSwap Roadmap, the Kitchen proposes to redirect emissions from our Farms to a new allocation - Ecosystem Growth. Ecosystem Growth is proposed to replace the existing Multichain Warchest allocation.

Why This Matters:

Currently, we are emitting approximately 28,684 CAKE to Farms per day. By reallocating a portion of these emissions, we enhance our capacity to fund other products and initiatives, such as PancakeSwap v4 and other essential parts of our roadmap. Reclassifying Multichain Warchest as Ecosystem Growth will allow us to support initiatives beyond just chain expansions, which are important for our long-term growth.

Summary of Proposed Changes

1. Emission Reduction:

  • Reduce current emissions to Farms by approximately 3,000 CAKE per day (a ~10% reduction), lowering the daily emission from 28,684 CAKE to 25,684 CAKE.

  • This reduction will be implemented in two phases of 1,500 CAKE per day each to minimize the impact on APRs across pools and chains. If the proposal is approved, these changes will occur at the end of the upcoming veCAKE epochs, at the Kitchen’s discretion.

2. Ecosystem Growth Allocation:

  • The 3,000 CAKE per day will be redirected, to a new category called Ecosystem Growth. This allocation will accumulate over time, serving as a warchest to support various products and initiatives, such as PancakeSwap v4, expansion to new chains, and any other products that might need some incentives to bootstrap activity.

  • Ecosystem Growth will replace the existing Multichain Warchest category, including the emissions that have accrued till date, and future emissions.

3. Emissions Status:

  • Importantly, this proposal WILL NOT result in an overall increase in CAKE emissions. The total emission remains unchanged; we are simply redirecting existing resources to maximize their impact.

Decision-Making for Ecosystem Growth:

  • The Kitchen proposes to have discretion in allocating the CAKE allocation within Ecosystem Growth, with the aim of increasing traction of various products and initiatives efficiently.

  • Our aim is for these products to be self-sustaining i.e. CAKE burn generated being equal to or greater than the emissions directed toward them.

  • As seen in our handling of the Multichain Warchest, we have been careful to only use what was necessary, currently still leaving ~0.2 CAKE per block unused out of the originally approved 1.25 CAKE per block (which was later reduced by 0.4 CAKE per block).

  • With our efficient utilization of the Multichain Warchest emissions, we have maintained deflationary CAKE for 1 year while expanding strongly across 8 other chains:

Chain DEX Rank (by 7-day Volume) 7-day Volume TVL
BNB Chain 1st $5B $1.5B
Arbitrum 3rd $292M $16M
Base 3rd $163M $8M
Ethereum 6th $141M $78M
ZKsync 2nd $17M $6M
Linea 3rd $14M $6M
Aptos 4th $9M $24M
Polygon zkEVM 2nd $1.9M $760k
opBNB 1st $477K $6M
as of 30 September 2024

Updated Tokenomics

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This will be the updated Tokenomics structure for our Trading allocation, simplified into two distinct categories. Emissions to Multichain Farms are mostly controlled by our veCAKE voters every fortnight, while emissions to Ecosystem Growth are proposed to be used at the Kitchen’s discretion. The exact breakdown between the two categories is not shown as that might fluctuate depending on how we utilize the emissions.

PancakeSwap v4

For the first use of the Ecosystem Growth funds, we propose to earmark $250,000 and 0.05 CAKE / block to support the upcoming PancakeSwap v4 deployment.

Grant Program

  • Hooks are a key part of PancakeSwap v4, which are add-ons that can be tagged to liquidity pools to enhance their functionality. We need to leverage the broader developer ecosystem to help design innovative and effective hooks for PancakeSwap v4.

  • As such, we’d like to set up a Hooks Grant Program with a total prize pool of $250,000 to incentivize developers to build PancakeSwap v4 hooks. The Kitchen will create Requests for Proposals for various Hook categories and invite developers to apply. We will also have an open category where we fund effective and useful hook ideas.

  • This $250,000 will be sourced from funds that have already accrued to the Multichain Warchest allocation. We ask for discretion in the exact implementation of the program. All funds will go towards rewarding developers on an as-needed basis. Unused funds will remain in the newly labeled Ecosystem Growth allocation for future use.

Emission Program

  • Separately, we ask for 0.05 CAKE / block for an ongoing Emissions Program to reward the most profitable hooks on PancakeSwap v4.

  • We understand hook developers may face difficulty in attracting liquidity despite having built a great hook. Hence, we propose to reward hooks that have displayed good market traction with CAKE emissions to direct even more liquidity towards them.

  • Hooks that come through our Grant Program will be rewarded with some CAKE emissions to start. However, to continue receiving CAKE emissions, hooks will need to regularly generate high revenue, which will lead to more CAKE burn.

  • The Kitchen requests for discretion in the exact implementation of the Emission Program as well. Unused emission will remain in the Ecosystem Growth allocation.

Conclusion

We believe that these proposed changes will significantly enhance our ability to support ecosystem growth via various new products and initiatives, leading to sustainable growth and improved user experience. If the community supports this proposal, we will implement these changes and redirect a portion of CAKE emissions to foster innovation and development within our ecosystem.

We appreciate your consideration and look forward to your feedback.

1 Like
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You beat me to it!

Was just about to post this as a thread-honestly speaking I’m a little saddened that I’m not seeing any of this proposal being directed towards the ambassador program.

I feel that under ecosystem growth that would be sort of inherently implied that some allocation would go to it, considering to my knowledge at the moment they’re actually is a new allocation for the program and my associate to do some really impressive work and help the PR for the platform.

I’m curious on yours and honestly anyone else reading this’ Feelings about that, and if I maybe just am unknowingly sounding selfish However, it happens, speaking with certain key players in the program, and not only with the enhanced ecosystem.

This would significantly add to the ecosystems social ranking in the industry being much more effective.

As it stands I’m grateful to be a part of the project but I think we can all agree PCS Lords are engagement would improve significantly due to all the more traction it would gain via an allocation of really any sort for the content creators / data analytics, etc

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Honestly, I don’t think this type of proposal “at the kitchen’s discretion” is right without first knowing what the real percentages or portions of “cake” are that they are already handling “at the discretion” as a retail investor.

This proposal really leaves me with many doubts and I’m only left with the feeling that they will be using resources - furthermore, it will be cake - to use them “at the discretion” which sounds, with all due respect, “we will do what we think is convenient” and that may not always be the best for the community and ecosystem.

It leaves me quite disappointed, and in my opinion there are already resources - more than enough, unless there is more transparency - to finance this or other initiatives.

Previously, juicy APR incentives were offered only as a reference, which ultimately brought down the price of cake, due to how unsustainable this ultra-inflationary model was.

Now it seems curious to me that there is no proposal to create a “community fund” perhaps with the same resources, removing the so emphatic “at the discretion of the kitchen” since essentially we also remember, the ecosystem does everything, and although there is trust in the chefs and the kitchen, we are all human and we can make mistakes at some point, and I think that should not be chosen by a few given that some time ago, in addition, “governance/decentralization” was created and that is why we are also here, and not directly in a cex to give another example.

We also believe in the potential of dexes and I think pancakeswap is very high on the list, but maybe I’m just misunderstanding this proposal, and I insist, if there were any proposal, project, affiliate or other related to v4 it should not be a “discretionary” decision and rather it should be a “community and decentralized” decision or in the worst case with “discretion prior to community approval”.

With much love, we need to rethink this in a better way.

Being realistic, for me, and many old investors in my personal opinion, I do not understand how a proposal of this embargo and significance can really be something positive for the ecosystem, and again, with all due respect, but also for us who, like me, chose to trust a large part of our capital for more than 4 years, this is a lack of respect due to the lack of transparency and concrete and real explanation of what will really happen with this diversion of funds.

With all the love in the world, greetings and my best wishes.

1 Like
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Very astutely put my friend

couldn’t have said it better myself…

2 Likes
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I believe that after the community voted on this proposal, my words most likely reflect what many wanted to say, or thought, or felt, so according to the votes this proposal was rejected by the vast majority.