Pause STKR Farms

The following is a proposal to pause the STKR farms, which currently distribute STKR to 3 LP pairs (XTZ/wXTZ, ETH/STKR, XTZ/STKR).

Background: At present moment, we distribute nearly ~400k STKR per month to all of our farms. This is equal to $12k-$16k per month or $144k-192k per year. We can implement a fee on LP tokens, which may be 5%. This would equate to $50k in fees if we round up the current farm capital from $780k to $1M.

However, we would need to push out new farm contracts to enable fees. This would require users to migrate to the new farms and with a fee in place, all users may not migrate so our fee could be less than $50k. Please note I am assuming no large changes in capital deposited in the farm given the relative stability over the last few months.

The proposal is to do the following: end the existing farms on Dec 8th without pushing new farms.

Instead of distributing STKR to the farms, fees from other projects should be allocated to buyback STKR. Most should actually be used to build new projects. At this point, airdrop recipients have likely cashed out or forgotten about STKR and hence, the farms are where we bleed STKR the most and reduce value. This proposal could help build STKR back up in the short-term.

Notes:

  1. We may lose liquidity in wXTZ and STKR, but if funds are devoted to repurchasing STKR, trading fees and price action may reintroduce liquidity organically.
  2. The STKR farms benefit Staker as a marketing tool and may be the main benefit.

I like the STKR farms.

I do also want the value of STKR to rise and basic economics states the value of an asset will depreciate when supply increases which is the current status of the STKR ecosystem.

This proposal will be similar to a bond buyback or stock buyback program.