Discussion: Potential Faucet Improvement

🍯 Honey
#1

One of the goals of the faucet is to help distribute a significant amount of honey to broad and inclusive set of stakeholders. However, we would prefer if people who participate in the faucet don’t just immediately sell the honey because then they aren’t actually stakeholder, to help encourage the behavior we can an add an additional game to the faucet, where honey is held for a user and unlocks some time after they stop claiming, forcing them to choose to accumulate more honey or stop and wait before they can sell. By weeding out people who are interested in selling over the short term we can more effectively target the honey distribution towards users that have a longer term interest in the community success, and make it less attractive to people who want to immediately sell.

As a recap the current faucet mechanism works like this:

  1. each period x% (currently 5) of the faucets balance is distributed to all registered users.
  2. A user cannot immediately claim a distribution, but must register and then come back and claim the next period. If they claim they will automatically be registered for the next period, if they fail to claim in a period their share will be forfeited and they would need to start the registration and claim flow over from the beginning.

This is a pretty simple but elegant mechanism, the faucet will never run out of honey and can support an arbitrary large number of users. It can be topped up via conviction voting, making it a simple extension to the 1hive DAO.

Proposed change:

  1. each period x% of the faucet’s unallocated balance is allocated to all registered users
  2. when a user claims a distribution, they do not receive honey in their wallet but an internal balance is stored and accumulated in the contract along with the block number.
  3. the user can withdraw their balance if they have not made any claims in the last y blocks.

I’m not sure if adding this extra complexity to the faucet is worth it, or if the fact that you can’t immediately sell would remove too much of the fun from the faucet distributions, but thought it was interesting enough to write up and have a discussion about.

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Request to fund Rabbithole campaign
Proposal to top up the faucet
#2

I liked your proposed changes. The current faucet mechanism especially 2nd point is not good, suppose a registered user have some health problems and he can’t access any device to claim the faucet so he lossed what he is doing regularly.

It’s better to change to fair model.

#3

I’m assuming here that the faucet’s unallocated balance mentioned in point 1 of your proposal means the unclaimed rewards from last period, so please correct me if I misunderstood.

Would there be value in creating a sort of ‘staking’ process where users who do not collect their reward immediately opt in to a pool of extra rewards, such as the unallocated funds? This way the fun of immediately claiming still persists, while community members who stick around are rewarded for their loyalty. This could be dynamic, so let’s say someone is originally opted in but decides to withdraw before a certain threshold is met, then their extra rewards will again be forfeited into the unallocated balance.

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#4

I see pros and cons in both options.
I do not like the idea of “punishing” good actors due to bad actors behaviour but i understand we do not need “treasure hunters”.

#5

This was my thought also, having some way to opt in to a pool that offers an additional reward for accumulating. Unclaimed rewards could be distributed to the users who opt in. Could there be something like easystaking on the eth mainnet for stake?

#6

You know it would be interesting to issue a second token say called WAX - whatever you want that goes with faucet/pollen whatever earned HNY.

Then basically construct a value from the wallet HNY and WAX called STAKE = HNY/WAX and force this to be > some MinimumStake and < MaximumStake (say 1). The idea here is if you sell your Honey and want to hit the faucet again - you only get STAKE x FAUCET - same with LP rewards - when you want your LP rewards you get STAKE x LPDRIP amount of DRIP.

My ideal is that this STAKE is determined by the minimum amount of STAKE you had during say the past month or so and using this value to scale rewards encouraging people

  1. To hold Honey for long periods and to maximize their STAKE to get anything out of community LP, faucet and possibly other rewards.
  2. For new people to earn WAX with their HONEY (and not just buy in) to improve their STAKE value above the minimumSTAKE everyone gets…
  3. As one earns more HNY and WAX there is additional incentive to maintain STAKE and not sell HNY. But people have to earn so certain contributions will always earn full HNY - say sourceCred or proposal work. It is just the LP, and faucet and other easy rewards that should have this stake as a key metric for how much of what someone should get is adjusted.

WAX effectively is used to track how much HONEY a user has been given/earned relative to how much they have sold and hence creates the STAKE percentage defining their ‘investment stake’ in the community based not just on how much WAX they got (work or other) but also how much HNY they have left relative to the amount they got.

This is an idea I have been toying with ever since carl in r/ethtrader with DONUTs created our vote=minimum(DONUTS, CONTRIB) where posts earn DONUT and CONTRIB where CONTRIB is a non-movable token and DONUTs are the value token that can be traded and exchanged for value.

There are some issues with this STAKE model regarding people doing work needing to sell HNY to live (no-one can maintain a full 100% stake expecially the serious contributors) so one can just alter the STAKE minimum based on the amount of WAX - anyone with over like 10 or 100 WAX basically gets a higher STAKE min

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#7

2 weeks nothing from faucet what gives

#8

Personally I think the user should be able to vote on proposals with their faucet HNY even when they haven’t extracted it & I think the best way to do that, without polluting conviction voting (to check for allocated balances in the faucet), is to put it in their account and apply restrictions where necessary.

I think you could use the token manager vesting functionality. That way the user could still vote in proposals.

Alternatively you could register the faucet as a token manager hook and block transfers of any amount that makes the balance less than the amount earned from the faucet, until they stop claiming, or some other condition is met.

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#9

This reply suggests to me we would remove the “clalim()” function. @lkngtn Can you clarify if you meant to imply that the register() -> claim() process would change?

#10

I like the Topic… I’m a long term holder and a investor/trader with that said, what happens if I sell 60% of HNY at a good price and buy back in at a good price ?

#11

I like the topic too, if I am understanding this correctly then I think this is quite a good idea from willjgriff (quoted). What if you set the limit based on, you can only withdraw if the balance is more than current distribution period?

#12

I think if we made it so you don’t immediately get the honey, it would definitely be a nice to have for people to be able to vote with the honey they have claimed but not withdrawn. But I don’t think we would want to add a hook as this ads some overhead for every token transfer and also create means that the faucet contract itself becomes super critical infrastructure.

Also if we used the vesting functionality I think it would only work if we allowed the faucet to mint tokens which wouldn’t really fit in our model where all distribution routes through conviction voting.

I also think its okay if we assume that a large part of peoples honey cannot be used to vote, eg if you are providing liquidity you also are not able to vote (same for staking in celeste), since conviction voting adjusts dynamically based on active stake it sort of creates a balance where you might be able to earn some additional yield by not participating, but the people who do participate end up having more influence on distribution.

#13

Frankly, due to the large quantity of people registered, the amount of HNY per claimer is so small, I wouldn’t bother changing anything.

If you let ‘account’ gather X amount of HNy before they can claim it, then anyone that would want to sell it anyway, will do it then. This would only shift the very light selling pressure in 48-hr cycles to a much stronger weekly (or so) selling pressure.

Those who want to keep, keep and those who want to sell, sell, and with the current low reward, most of the latter probably won’t come back anyway.

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#14

Disclaimer: I still have all the HNY i received from the faucet.

Rather than imposing HODL behaviour, though, I would rather find ways to stimulate it. For example find incentives to pool HNY in HoneySwap (yield farming kind of ideas). For example LP’s could be dropped additional Honey if their pool (e.g., HNY/xDAI) reaches a certain threshold. Etc.

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#15

We already have LP farming called honeycomb (https://hny.farm/) but disable as of now due to some issues regarding conviction voting

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#16

oh thanks! I didn’t know about it!

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#17

it would be very cool if when we claim faucet, instead of have HNY in wallet we can have parts of the XDAI/HNY farm, but i don’t know if it can be possible.

it will a good start to incentive people to add liquidity to the pools

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#18

No, we are not going to giving the other tokens here. There is a purpose for giving HNY tokens.

#19

it’s just a way to have more chance they hold instead to sell

#20

I like the idea of registering again after claimming. More ppl could visit honeyswap again :slight_smile:

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