Abstract
This proposal suggests implementing a staggered buyback schedule for Magpie’s regular monthly buybacks to mitigate price impact and prevent potential exploitation. The buyback funds, generated from the Magpie Treasury’s SubDAO token holdings, buy back the corresponding SubDAO tokens. By gradually spacing out the buybacks, starting with a 20-day period in the first month, increasing to 25 days in the second month, and extending to 30 days by the third month, Magpie aims to ensure a more stable token market, ultimately benefiting the overall ecosystem.
Motivation
Currently, Magpie’s monthly buybacks can lead to significant price impacts due to the large volume of tokens purchased in a short timeframe. This situation creates opportunities for users to exploit these buybacks for profit by timing their trades, which can lead to market manipulation and volatility. To address this issue, we propose spreading out the buybacks more evenly throughout the month.
This approach aligns with Magpie’s strategic objectives of maintaining a stable token economy and protecting the interests of all Magpie stakeholders. By mitigating price impacts and reducing the chances of exploitation, we can create a more stable and healthier market environment.
Specification
Implement a new schedule for Magpie’s buybacks, spreading them throughout the month to reduce price impact and potential market manipulation.