xTRIBE Tokenomics Upgrade

The TRIBE token is critical to the governance and success of the Tribe DAO. This proposal seeks to improve and expand TRIBE’s capabilities for Governance and utility in the Tribe ecosystem.

Summarizing Current TRIBE Tokenomics

TRIBE is used to manage and protect PCV and the FEI peg. TRIBE can be used to backstop PCV in the event user FEI goes below an acceptable level. Additionally, buybacks from PCV equity further incentivize effective PCV management.

Currently, a large portion of TRIBE rewards go to FeiRari pool 8, and over 10% of the circulating TRIBE supply is locked there. There are a number of shortcomings with this approach, but the most obvious are:

  1. TRIBE locked in FeiRari can’t vote on DAO governance proposals or other protocol initiatives
  2. TRIBE locked in FeiRari isn’t autocompounding

Proposal - xTRIBE

To resolve the conflict of active governance participation and yield generation, this proposal introduces the xTRIBE token. xTRIBE effectively addresses those concerns as well as further empowers and incentivizes holders to participate in Tribe ecosystem:

Features of xTRIBE:

  • Votable on the DAO with multi-delegation capabilities
  • Autocompounding emissions
  • Percentage of buybacks redirected to TRIBE holders
  • Ability to direct emissions through a similar mechanism to Curve gauges or Tokemak reward direction. Note this does not include locking (vote-escrow like Curve), and xTRIBE will be a fully liquid extension of TRIBE.
  • xTRIBE is ERC-4626 compatible, making it available as a plugin on Fuse and any other project that integrates the standard.
  • Can be used as collateral in Turbo with the largest revenue share out of any token. Maximizing the productivity and utility of xTRIBE.

By improving alignment of governance and yield, and adopting the new vault standard for tokens, xTRIBE empowers TRIBE holders and increases participation in DAO governance.

Autocompounding Rewards

Similar to xSUSHI, all rewards sent to the contract from fees are autocompounded for holders. xTRIBE leverages this mechanism and further improves upon it by distributing new rewards over a week instead of all at once to protect against MEV and other attacks (inspired by xERC20).

These rewards can come from buybacks and emissions and future products that plan to benefit xTRIBE holders.

The existing TRIBE in FeiRari pool 8 and RGT in pools 6 and 7 will be automatically upgraded to xTRIBE.

Voting and Multidelegation

Like TRIBE, the voting delegation of xTRIBE will be non-transitive. I.e. you can’t re-delegate a delegation.

However, xTRIBE will introduce the concept of multi-delegation to allow greater governance participation. xTRIBE holders will be able to delegate their vote to multiple addresses as opposed to currently being able to delegate to only one.

Multi-delegation solves potential issues with single delegation where giant voting blocks of TRIBE can easily dominate the outcome of a vote. By creating a multi-delegation algorithm, aggregating contracts can easily “pass through” delegation rights to their holders.

Reward Direction

For example, assume 1000 xTRIBE is allocated on the gauges, split 80/20 between fFEI-8 and fFEI-6 and the TRIBE per second is 50. In this scenario, 40 TRIBE per second will go to pool 8 and 10 will go to pool 6.

TRIBE holders will control the whitelist for gauge destinations. This can be extended to automated mechanisms in the future such as “most TRIBE staked” or some kind of TRIBE burning tribute.

The reward direction mechanism will be designed to be fully general and compatible with Fuse, so that new teams can apply their liquidity mining directly on top of the Fuse lending platform, either TRIBE or their own project token. This has the potential to kick off the “everything wars” where all new projects use emissions control to incentivize liquidity on top of Fuse.

xTRIBE will increase the voting accessibility, composability, capital efficiency, ease of use, and utility of TRIBE.

The base code is already developed as an open source utility in flywheel-v2 and ERC4626 repos, and will be audited by ConsenSys Diligence in April.

Can’t wait to hear more thoughts from the community on this proposal!

22 Likes

xTribe provides a much needed solution for the farmers on the FeiRari. Now they will be able to vote on their favorite color for the FeiRari.

8 Likes

Really excited about xTRIBE! There are many benefits for xTRIBE holders with auto-compounding, emissions control, and more participation in governance, and alignment of governance with yield, and in the future there will be even more opportunities to benefit xTRIBE holders.

4 Likes

Excited about this proposal both as a small TRIBE holder and from the point of view of Volt Protocol, which will hold the TRIBE it receives in the token swap (pending DAO governance) as xTRIBE. Used in Turbo, xTRIBE becomes a cash flow asset, similar to the plans for the VCON token. Strongly in favor.

4 Likes

This is pretty exciting.
Some thoughts -

  1. Auto-compounding is awesome
  2. I don’t want more work, having to direct emissions blah blah blah is another job. As a holder I want passive income and a voice in the direction of the project, not some mini game where I can lose money by not learning the meta strategy
  3. I find myself really loving the looksrare tokenomics model where I get Auto-compounding rewards in the governance token as well as a share of revenue the platform generates. Would be cool to stake and get tribe + fei
1 Like

Exciting proposal, there’s a lot to like here.

I like this perpetual reward mechanism. The parameters of the buyback program itself will cause the reward to fluctuate, as will market conditions, yet it still feels like a more dependable reward than the current TribalChief emissions that are trending towards zero over the next 12 months. At the very least, it provides the opportunity for greater upside.

2 Likes

Love the proposal :slight_smile:

Especially, I love the fact that we’re getting all these cool upgrades to TRIBE, but also that this introduces a lot of new open-source primitives (xERC4626, ERC20MultiVotes, ERC20Gauges) that will be able to be used by other projects, too. Great work!

Looking forward to “self-repaying loans” using xTRIBE collateral :eyes:

8 Likes

Strongly in favor. will definitely increase on-chain governance participation. also like how it integrates successful ideas from other defi games and avoids known pitfalls.

1 Like

possible bribes ? like Votium :eyes: :eyes:

Hi @joey

I am a huge fan of the tokenomics upgrade. Multi-delegation is super cool.

I have been looking into Tokenomics ideas over at Index Coop. So these questions are in the interest of learning more :slight_smile: I really like the proposal. Can you provide some colour around the following points to help me improve my understanding.

  • xTRIBE as collateral, if some can borrow TRIBE, I think we may see a recursive lending and borrowing loop, like stETH and ETH on Aave V2 Markert on mainnet. It would be delta neutral and could be cycled 3-3.5 times with a high LTV ratio.

  • Will the receipt token (fxTRIBE ?) for depositing xTRIBE into a Fuse pool be able to vote ?
    (I suspect the answer is yes, but just want to confirm)

  • Thinking back over the xSUSHI loss of capital on Cream last year, I am assuming xTRIBE can not be borrowed on any lending market as this potentially opens up the same attack surface area. Might be uneconomical, but could be a tail risk.

  • Is there any time-lock period when going from TRIBE to xTRIBE ?

  • With the xTRIBE determining 100% of the TRIBE distribution across the gauges. Was there any consideration to separate this up say 60% determine by xTRIBE and 40% determined by an internal team ? I noticed Balancer has a liquidity team that allocates a portion of the BAL rewards and was wondering if that was considered here.

I found this article interesting, so I thought I would share it here. It if for general ideas for people who like going down the tokenomics rabbit hole on other protocols. Introducing veRev — a Yield Distribution Mechanism | by UXD Protocol | Mar, 2022 | Medium

Great proposal. I am really looking forward to seeing this implemented and xTRIBE in GMI.

1 Like

I think this or something like it would be great. some large portion of incentives could be xTRIBE decided, and then other portions of the incentives could be determined via other pods/proposals/entities/strategies. makes sense to maintain that flexibility and structure

2 Likes

This is possible but not currently a part of the proposal. TRIBE is unborrowable on pool 8 currently due to the rewards APR but this could change if voted.

Fuse v1 will be tricky to implement this, but Fuse v2 should be yes. There is no release date for this, but it will be after Turbo, xTribe, Tribe Launch, and Vaults.

xTRIBE uses new xERC4626 which is not susceptible to the donation attack CREAM suffered.

There is no lockup planned in either direction, although this is an interesting feature to consider.

I think it is smart for 10-25% to stay with a pod that is managed through the DAO

2 Likes

Very cool proposal! I’d like to throw out the possibility of locking 80/20 TRIBE/FEI (or WETH) BPT instead of TRIBE into xTRIBE, or perhaps offering a second “xxTRIBE” for 80/20 BPT.

It would increase capital efficiency quite a bit compared to having a huge pile of TRIBE sitting there that doesn’t increase on-chain liquidity or earn trading fees.

3 Likes

I also proposed this initially, and after discussions with @storm, we realized that since the protocol owns PCV ETH, can mint FEI, and has a TRIBE treasury, it would actually be better to manage separately the concerns of TRIBE liquidity and governance / user holding. Not a topic for today because IDO funds (FEI/TRIBE LP) are still locked/vesting, but over the long term it will give more control on liquidity depth to the DAO if it manage itself the liquidity of TRIBE, instead of relying on incentives and user behaviors (sort of a LaaS but for itself).

6 Likes