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This proposal asks if Osmosis should cease providing incentives to the NGM/OSMO pool (#463). Passing this proposal will remove OSMO incentives at the next routine incentive proposal.

Details

Osmosis Governance recently removed incentives from EEUR in the light of the winddown of the stablecoin by the E-money team: [Hidden link]

NGM/OSMO retained incentives from Osmosis as the [Hidden link] indicated that the chain would be pursuing other use cases.

Over the last few weeks, multiple NGM pairings have been created with heavy incentivisation of NGM.

This is part of a new strategy by the e-Money team to achieve the following goals:

• Create multiple pools against major tokens to reduce exposure to a single asset (OSMO).
• Join the pools using Treasury tokens programmatically and in a controlled fashion to not adversely impact prices.
• Deploy genesis LP allocation of NGM to incentivise participation by 3rd parties.

This is further detailed in this article: [Hidden link]

The pool has had suitable liquidity for normal trading purposes up to this point and will likely grow further with the addition of these high incentives. The share of OSMO incentives this pool receives will also likely grow as there will be a sustained increase in trading volume from liquidity providers purchasing NGM from the NGM/OSMO pool to join the new pools as well as from the programmatic joining of the pool with single sided NGM to establish the team’s own liquidity.

As Osmosis governance originally incentivised NGM/OSMO as a governance token of a chain with EEUR as its flagship product the Osmosis incentives should also be re-evaluated in line with this new strategy.

This proposer believes it is in the best interest of Osmosis to remove incentives from the NGM pool for the moment until these pools settle and a course is confirmed for NGM.

See the Commonwealth thread for the full discussion.

Commonwealth Thread: [Hidden link]