Don’t accommodate the sellers but give them a reason to hold onto their fei and tribe tokens.
We are focussing on fixing the symptoms and not addressing the root cause. The main root cause is the valuation of the Tribe tokens. $1.3B were raised but only 30% were preswaped to Tribe. At the moment tribe has very little value to the speculators; however, many preswapped investors are really upset since tribe is only at $2. The original Tribe FDV/PCV and circulating /PCV approximates tribe value to be $3.32. May I suggest that you open up the war chest of ETH and start buying Tribe tokes until it goes to $4.65 (this is assumption of 50% preswap at $1.3B calculation)? When Tribe goes up, people will keep tribe and fei tokens to provide liquidity to get more tribe tokens. Give the speculators a good reasons to keep their fei and tribe tokens. Please don’t accommodate the sellers, we want to encourage the hodlers.
You have to remember that Fei is supposed to be $1. You will need to have both Fei and Tribe to provide liquidity on Uniswap. If tribe is $5, then you will need five Fei. When people provide liquidity, they will get more tribe tokens; hence, an incentive to buy and hold both Fei and Tribe. Everyone will want to hold their fei-tribe if they can get 200 to 300% APY. This is what defi is all about, YIELD, YIELD, YIELD. Other defi sites will want to compound the APY; hence, this will increase FEI demand back to $1. Currently, people just want to sell both Fei and Tribe because they got Tribe for free and they want their Fei converted back to ETH or USDC.
There is nothing wrong with the fei protocal; hence, don’t play around with it. We would not have this problem if there were on 50,000 or 100,000 ETHs contributed to the genesis. The fact is that we got more than 600,000 ETHs. Just image using 100,000 ETH to buy back tribe tokens and distribute them to liquidity holders or preswappers. Just think that 500,000 ETHs and not 600,000ETHS were contributed to the genesis.
Ultimately, we want to be like MakerDAO where 1 Fei = 1 DAI = $1, and 1 tribe = 1 MKR = $2,200 USD.
It is basic macro economic of supply and demand. Currently there are $1.3B of fei but there is no demand and everyone is trying to get out. The fei protocal is trying to burn/penalize for selling fei. It is a vicious cycle since there is too much supply. Instead of modifying the protocol, you create a greater demand. This way sellers can get out and hodlers will benefits from holdings. Fei is supposed to handle $100B+ in the long run. Yes 1 tribe will be greater $2,200 if the team can get through this.