The goal of this proposal is to ensure that Ruler protocol is running efficiently. Mechanisms, including listing, delisting, and rewards emission, are supporting the protocol as expected.
For Ruler to be an efficient lending solution, it means that
- Collaterals listed have enough borrowing needs.
- RULER emissions can support the above borrowing needs without waste.
Looking and analyzing the data since launch, a more formalized structure for collaterals delisting and Liquidity Mining emission is in need. This proposal aims to structure the following process:
- Collateral types structure
- Delisting process and criteria
- Liquidity Mining emission adjustment
Ruler Collateral Types
There are three major types of collateral on Ruler. Each collateral can change its type through a community proposal at any given time, it will take effect in the next loan cycle.
- Collaterals that have wide-spread recognition in crypto communities, like wBTC and wETH.
- Collaterals that are important to the protocol like RULER as the governance token of the protocol.
- Collaterals that are critical strategic partners, like COVER.
- Collaterals that have some recognition in some crypto communities, like xSUSHI.
- Collaterals that are from strategic partners, like INV.
- Collaterals that are from newer projects without wide recognition and unclear borrowing needs.
Ruler Collateral Delisting Process
If a collateral is not borrowed against sufficiently, Ruler will delist the collateral the month after. Collaterals can be listed again in the future when the borrowing needs are justified.
- Total borrow amount is less than $70,000.
- Borrow/Loan ratio is less than 20%, and rewards reduction is not possible. If rewards reduction is possible, it will be executed before delisting.
- Partner is incentivising the liquidity pool.
- Collateral liquidity pool has no RULER rewards.
- Total loaned is expected to be more than 200k.
Liquidity Mining Emission Adjustment
RULER emission for Liquidity Mining consists of two parts. A base rewards rate for each collateral, and a budgeted weekly extra rewards emission. The distribution of the extra weekly emission is up to the community to decide through a weighted snapshot proposal on the 3rd week of each month.
- Core will receive a base rewards of 50 - 150 RULER/week based on borrowing needs.
- Norm will receive a base rewards of 20 - 50 RULER / week based on borrowing needs.
- Innov will NOT receive any base rewards, requiring partners to provide rewards.
Each base rewards can be adjusted within the type range. For example, wETH (Core) with high borrowing needs will receive a base rewards of 150 RULER/week. xRULER (Core) with lower borrowing needs will receive a base rewards of 75 RULER/week.
There will be an extra 1000 - 3000 RULER / week as extra rewards to the Ruler pairs of the month.
The range is based on the total amount of pairs and the borrowing needs from previous months.
For example, based on the data from March and April, 1200 RULER/week is a reasonable extra reward for May. It will be a ~35% reduction in emission for May.
Note: the team may adjust rewards based on the borrowing needs of the collateral.
Monthly Extra Rewards Voting
The distribution of the extra rewards are decided by the community through a proposal. All collaterals of the month can participate in the voting.
Note: Innov collateral type that is voted on to receive less than 10 RULER / week, will be ignored to save operating resources. Those RULER rewards will be split between the other collaterals proportionally.
- Collateral type structure and criteria
- Delisting process and criteria
- Rewards emission rate adjustment