Hey everyone. after gathering feedback in the previous forum topic, we have decided to split the original proposal into two - one to relabel the Multichain Warchest as Ecosystem Growth and the other for emission redirection.
This is our proposal to relabel the Multichain Warchest as Ecosystem Growth. Please give your feedback and comments below - we will take them into consideration before we post the vote proposal on our voting page.
We propose to relabel the current Multichain Warchest allocation as Ecosystem Growth to expand its scope. This allows us to provide incentives for PancakeSwap’s upcoming products and initiatives that will fuel ecosystem growth, beyond just chain expansions which was the sole use of the Multichain Warchest.
Why This Matters:
As the late Charlie Munger once said, “show me the incentive and I will show you the outcome.” To remain competitive, the Kitchen will continually ship new products and initiatives, and these will require incentives to kick-start their adoption and set them up for success.
The current Multichain Warchest, which receives ~0.2 CAKE per block, is solely meant to support PancakeSwap’s efforts in expanding to new chains. While the Kitchen will continue its chain expansion plans in a focused manner, there are other planned products in the pipeline like PancakeSwap v4 that do not fall into this category, but would still require incentives.
By relabelling it as Ecosystem Growth, incentivizing PancakeSwap v4 becomes possible as it is a product that, if successful, will contribute meaningfully to the protocol’s growth.
Summary of Proposed Changes
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Relabel the current Multichain Warchest allocation as Ecosystem Growth, and expand its scope to allow its accrued funds and ongoing emissions to be used to grow PancakeSwap’s ecosystem. This includes but is not limited to new products and initiatives like PancakeSwap v4 and expansion to new chains.
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Just like with the Multichain Warchest, to allow the Kitchen to have flexibility in the implementation and use of funds within the new Ecosystem Growth allocation. We are committed to providing full transparency in the usage of funds and will provide regular reports as detailed below.
Transparency and Accountability
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:
as of 5 November 2024
| Chain | DEX Rank (by 7-day Volume) | 7-day Volume | TVL |
|---|---|---|---|
| BNB Chain | 1st | $4b | $1.5B |
| Arbitrum | 3rd | $443M | $16M |
| Base | 3rd | $350M | $10M |
| Ethereum | 7th | $151M | $72M |
| Linea | 3rd | $17M | $7M |
| ZKsync | 2nd | $13M | $3M |
| Aptos | 3rd | $11M | $29M |
| Polygon zkEVM | 3rd | $619k | $347k |
| opBNB | 1st | $396K | $6M |
We will establish regular reporting on the usage of the Ecosystem Growth allocation on the PancakeSwap forum, detailing how funds are being utilized, the outcomes of various initiatives, and any adjustments made to strategies. This allows us to retain flexibility in the use of funds, while still providing transparency to the community.
The Kitchen is also open to community-led initiatives and feedback. We invite the community to make suggestions and proposals on the PancakeSwap forum - we will review and implement them if they display high potential of contributing to PancakeSwap’s long-term ecosystem growth.
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
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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.
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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 specific Hook categories and invite developers to apply. We will also have an open category where we fund effective and useful hook ideas.
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This $250,000 will be sourced from funds that have already accrued to the Multichain Warchest allocation, hence no new emission is needed to fund this 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
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Separately, we ask for 0.05 CAKE / block for an ongoing Emissions Program to reward the most profitable hooks on PancakeSwap v4.
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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.
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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.
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The Kitchen requests for flexibility in the exact implementation of the Emission Program as it may require adjustments to our criteria and incentive rates depending on the initial results. Unused emission will remain in the Ecosystem Growth allocation. The emissions will only be utilized after PancakeSwap v4 is live.
Conclusion
If the community supports this proposal, we will relabel the Multichain Warchest allocation as Ecosystem Growth, and allocate the funds and emissions wisely towards products and initiatives that promote PancakeSwap’s long-term growth.
We appreciate your consideration and look forward to your feedback.