[DAO Discussion] Amendment to CMP #3

[DAO Discussion] Amendment to CMP #3


This CMP seeks to amend the 10 days before the end of the quarter time-weighted price average calculation outlined in [CMP #3] - Protocol Compensation Overhaul to instead use a calculation of the time-weighted price average over the entire quarter.

Community Interest:

  • I would like to see a formal proposal
  • I am not interested in seeing more
0 voters

High Level Details:

[CMP #3] - Protocol Compensation Overhaul was designed to align team compensation with token holders. However, in doing so, it did not incorporate the concerns raised by community members regarding the time-weighted price average calculation for holders over the preceding 10 days before quarter close. This CMP serves as an amendment to CMP #3 to address these concerns while keeping the remainder of [CMP #3] unchanged.

Provide Low Level Details:

With the passing of [CMP #3], there are concerns that the time-weighted price average calculation conducted in the 10 days prior to the end of the quarter creates disconnects between the Volta team and holders. Specifically, there is no longer any incentive for the Volta team to conduct profitable buybacks during the quarter. Instead, the incentive is to raise the price only at the end of the quarter, which can easily be front-run since the 10-day window is known beforehand. Furthermore, since buybacks are no longer incentivized, the decreasing market price has the capacity to result in lower Volta prices on UwU for Volta deposits. This leads to a reduction in the amount holders can borrow against their Volta, and it creates significant liquidation risks for holders already borrowing against their Volta (Looping excluded).

For these reasons, an immediate amendment to [CMP #3] is needed to address these concerns and further align the Volta team with Volta holders. To achieve this, this CMP introduces an amendment to the time-weighted price average for the 10 days before the close of the quarter described in [CMP #3]. Instead, the watermark is to be calculated at the end of a given fiscal quarter by the time-weighted price average over the entire quarter up until the close.

Since we are currently within a quarter, the time-weighted price average for the current quarter is to be calculated from the end of voting on this CMP to the closing of the quarter.

Since a DAO Discussion is meant to introduce a proposal, not all information may be available at this stage. The discussion should be used to measure the community’s interest in what is being proposed. If the minimum requirements are met, it can be submitted as a Request for Comments.


I think if we vote this kind of CMP and it will be applied after 1Q end, that will means next big payout for team. (Because Average price for 1Q will be around 150±$ ? )

High watermark is set at $195. Price needs to be above this for performance fees to be paid out. Same for subsequent HWMs.

Sounds like this CMP would change this:

Ah ok forgot about that. So… pamp? :smirk:

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