Removing - Decreasing MGP emissions on Stablecoin pools

Hey Magpie fam!

I was looking at the emission table of MGP token on docs and and realized a problem on it. Magpie allocates some of it’s MGP emissions on stable coin pools of Wombat. Here you can find the emissions table below :


The problem is weight of these emissions, as you can see on the table above, the MGP emissions of main pool stables equal to mWOM pool’s emission ( 280 ) which is waste of funds in my opinion. Let me deep dive into topic and explain the reasons :fountain_pen::man_teacher:

The main purpose of yield aggregators of ve-token model protocol is acquire as much ve-token as possible. On Wombat ecosystem; acquiring veWOM is essential goal of the yield aggregators because the more veWOM means the more TVL and the more revenue on protocol fees, bribes and shared fees.

To achieve this goal yield aggregators must be careful about the points below:

:point_right: Incentives for converted version of WOM token (mWOM ) must be high enough to attract new users for conversion action. This will bring more veWOM → high boosted APR → more TVL.

:point_right: Price of governance token must stay on healthy level because the APR on mWOM highly depends on MGP price.

:point_right:The peg of mWOM - WOM must stay on healthy level ( Magpie is the best on this )

:point_right: The emissions of governance token ( MGP ) must reduce in time to long term sustainability and price appreciation.

However, if you check the table that I shared above, Magpie has allocated huge part of its emission weight ( 981 /1541) to the stable coin pools on Wombat ( generally Main pool stables ) and if we calculate it (981/1541)*3 = ~1.91 MGP per second allocated to stable coin pools .( Note that 3 is MGP emission per second )

The main concern behind this idea is incentivizing stable coin depositors with extra MGP tokens to have high APR compared to the competitors to have high TVL and high revenue. However, this high MGP emissions causes a price depreciation and value loss on MGP. :small_red_triangle_down:

Here my proposal starts ! :fire:

As I mentioned in the beginning of this thread the main motivation of yield aggregators must be acquire as much veWOM as possible. To achieve this, yield aggregators must protect the value of their token while they provide juicy rewards for staking mWOM to have more veWOM → high boosted APR → High TVL ->More natural revenue instead of unnatural revenue by allocating MGP rewards. If you guys calculate it, you will see that buying WOM tokens with MGP is much efficient than incentivizing the Stable coin pools with MGP token.

Under these circumstances, I suggest Magpie team to reduce - remove MGP emissions that are allocated to stable coin pools. I.e, if we remove all of the MGP allocations on Stable coin pools, we will reduce MGP emission from 3 to 1.1 ( note that this ratio does not include wombat’s WOM - mWOM pool, it has 0.45 MGP / sec) . This means we will reduce MGP emissions ~55% in total ( ~1.55/3.45=0.45 is the comparison of new emissions to old emissions ) which is great to reduce sell pressure on MGP token :white_check_mark:

Also, instead of removing all of the emissions, Magpie can reallocate some part of it for mWOM staking. Let’s say 2 MGP per second total emission in general. So that, accumulated veWOM amount will increase due to high APR on that pool and yet, total emission will reduce ~ 42% ( 2/3.45 comparison of new and old emissions ). :white_check_mark:

Due to the lowering MGP emissions , Magpie will face with some TVL drop at first but in long run, veWOM treasury of Magpie will increase in time, it will attract more users in time with high boosted APR and high TVL will follow it in natural way.

This was a long thread but I had to explain all of the details to you guys! I hope you like my proposal as like my previous proposal!

Stay safe Magpie Fam :heart:


Great information John, totally agree right now we need to maintain a cost effective way to acquire voting power through vlMGP and if the supply keeps growing this will harm the ratio. Let’s put this on chain already lol.


You’re absolutely right for suggesting this, i hope this will go into voting and it will pass :white_check_mark:

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Not bad, not bad. This is a decisive move. We need to try. :grinning:

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Peg is working out great so far and we need to accumulate vewom. We must do it, is good for Magpie and for MGP.

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i think there is a risk by totally removing MGP emission on stablecoin pools, but appropriate reduction in MGP emission might be a good move. There is a need to have more detail calculation on the required emission to keep a healthy apr.

As I always believe, instead of reducing emission, bring more use case of MGP to increase the demand would be a better way.

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