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This program will compensate gas fees paid for governance and price request votes, distributed in the form of additional UMA tokens. UMAâs governance is incentive-based: any voter who votes correctly is rewarded with a share of the .05% total supply inflation.
Gas fees represent a fixed cost to voting, and the rewards are proportional to token balances. This means that token holders with smaller balances may actually lose money to vote. The recent rise in gas fees has led to frequent complaints across the DeFi space and within the UMA community.
Gas price have been on an upward trend with periods of dramatic highs
While reduced participation by smaller voters does not affect the game-theoretical properties of the protocol, it is inconsistent with UMAâs fundamental mission: Universal Market Access. Furthermore, prominent and helpful members of the UMA community are being discouraged from participating. While the protocol may not technically require their participation, the growth of the ecosystem benefits from their contributions in the form of mindshare.
The goals of the program are to:
- Increase voter turnout.
- Generate goodwill amongst the UMA community members, especially by demonstrating that their voice is heard.
- Increase the likelihood that farmers will turn into voters.
- Increase qualitative voter participation, such as in discussing UMIPs or helping to resolve price requests.
Distributing tokens in this way is consistent with the community token distribution plan.
The primary goals of that plan are to encourage wider distribution of the token and to put the token into the âright handsâ of governance participants. This program rewards those who are already voting and does so in a way that the recipients are still âpayingâ for the tokens.
The required qualifications for the gas rebates are defined broadly to ensure democratic participation. Any voter who reveals their committed vote is eligible for rewards regardless of whether they voted with the majority. However, this program will NOT include a 2-key voting setup and any other fees associated with $UMA token transfers.
The $UMA that each voter needs to be paid is determined and a list of eligible addresses ( only addresses that voted with more than 0 $UMA will be eligible) is put together. The rewards will be distributed along with the weekly liquidity mining rewards. This will apply retroactively to August 29th and include the votes to approve renBTC as collateral and for the price resolution of the yUSD-SEPÂ token.
As this program is being administered by Risk Labs and is not coded into the protocol, RL reserves the right to modify or amend it at any time.
Voter Gas Fee Rebate Program was originally published in UMA Project on Medium, where people are continuing the conversation by highlighting and responding to this story.
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