SSV Should Increase its Revenue Network fee to 10%

Governance SSV Token
42

I think this might be a more promising direction

2 Likes
43

Its a great idea, and its much better than status quo, though I am still in favor of a network fee denominated in ETH and then having that ETH directly go towards buying SSV via a DEX and then having that SSV burnt.

The reasoning is:

A stake and earn modal requires significant investment in new technical infrastructure, education, and UI/UX. These programs are quite complex in practice for all stakeholders.

A SSV network revenue fee denominated in ETH on top of the existing operator staking reward fee is simple to understand and simpler from a development standpoint to implement.

There is far less code required, in comparison to a stake and earn modal, to have that ETH revenue immediately buy SSV on the open market via smart contract and then burn that SSV. There are also less amount of aggregate transactions required, which means less unnecessary fees.

44

Seems to me that giving rewards to SSV stakers actually aligns incentives much better with long-term token holders, doesn’t it? Buybacks might lift everyone equally, but directing value to stakers specifically strengthens the alignment between those securing the network and those holding for the long run.

1 Like
45

The issue I have with the stake and earn modal:

  1. Have to educate users on how to do this - most users of crypto don’t understand how to activate staking. There are time and money costs to educating users on this new staking system
  2. Development costs - the development costs are higher for this sort of system. It likely requires some sort of vault infrastructure and a degree of maintenance of those vaults. Build time is longer to implement. Audits for those vaults are also likely required. Its significantly more complex.
  3. Entering and exiting into the staking vault are more fees that are passed on to the user. If I want to stake $100 SSV, and the ETH network is congested, than 20%+ of my intended stake could be eaten up byEthereum network fees just getting into the staking vault. Its cost prohibitive. More than 50% of the wallets holding SSV have less than $5,000 worth of SSV in their wallet according to Etherscan.

I see your point about aligning long-term incentives. If that is the case, lockups that go alongside higher percentage of rewards makes sense.

That being said, I still think the buy and burn modal is superior for the network compared to the stake and earn modal.

1 Like