MIP49: Staking Rewards

I believe it “fixes” the issue as you can withdraw it after resigning your nationality for ideological reason and move to El Salvador or some under-war country. ( after-all taxes are here to solve issue that lead countries to civil war)

You just need to commit it or pay taxes. :slight_smile:


I imagine ppl locking their MKR over here and with the rewards buygin more MKR to locked it again (don’t know if it’s possible a harvest+buying+lock again button), so we ensure even more the protocol.

Excellent proposal !

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Moving this back up for Visibility.

In desperate need to motivate Community members to participate in Governance–including but not limited to on-chain Voting. Please have your say. If you’re waiting for an L2 solution–it’s ways away–which means we are probably looking at a poultry Voter turnout going forward.

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+1. With all the opportunities on Ethereum to have productive assets that have yield + upside, I feel like MKR is not particularly desirable. It’s my only asset that I can’t really put to work, and the ways I can put it to work, decreases protocol security :frowning:


I like the idea of ‘governance rewards’, but currently there is the issue of gas fees eating any sort of revenue a person makes from said ‘governance rewards’. Also, we should aim to keep things relatively simple in concern for how protocol profit is handled. By keeping the buy and burn method as a way to provide a price floor I feel way more comfortable investing in MKR than I do in any other crypto. All currently revenue should go to a greater and greater size Stability Buffer so that we may further protect the protocol.

I see where you are coming from, but due to gas fees and the stability buffer a governance reward for MKR would act as a gimmick that would only benefit the few whales who could afford the gas costs and own enough MKR to make it profitable for them.


I posted this on another topic–but this is what you get when you don’t provide incentives:


Times up. Lets get it done.

I kind of agree with this, honestly.
Now even setting up a wallet for voting costs >300usd in gas fees. Crazy.

Something that could be done cheaply in the short term is an initiative (just like Sourcecred) of the following type:

  1. Governance devotes a certain amount of DAI/month to incentives
  2. The DAIs are periodically (e.g., once/month, just like SourceCred now) manually sent to the addresses of the MKR holders in the form a xDAI (i.e., on the xDAI chain).

Gas fees on xDAI or in the order of 0.00001 usd.

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Hey everyone!

I really apricate all the feedback and thoughts that have gone into the idea of Governance Rewards. To me, this is a proposal about keeping the protocol safer and allowing reasonable incentivizes to aid to that end.

With that said, I would like to move this MIP forward as soon as possible provided the community thinks it will add to the security of the protocol. So are there parts of this MIP that you think need to be edited to safeguard the protocol? Are there changes I can make that could ease the perceived tax burden of the Rewards?

Basically I would like to put this MIP forward in the next monthly Governance cycle and I’m wondering if there are edits I could make to improve it during its RFC period, or perhaps some changes that would make the MIP more palatable for those unsure. Either way would love some feedback, so thanks for the engagement!


I would just urge against issuing a receipt veMKR token in this process. Nothing against time locking MKR (I’d sign up for max), just want to avoid a MKR → veMKR taxable event.

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@prose11 reward in MKR if possible, not DAI. Otherwise excellent proposal. Just possible we will have to invest in an MKR tumbler or similar at some point.

Like a balancer smart pool? Other protocols are making smart treasuries, which may be good to learn from

@Uncle I do not now the details of Balancer, I am working from the assumption that at some point all the worlds’ governments will have worked out how to trace every single blockchain transaction. In this case our pool of contributors could be limited to those few living in crypto-friendly countries. As we can’t all live in Switzerland some generalized tumblr/zk-fixer for ERC20 would be highly useful. Both for the spread of DAI and for the continued MKR-related governance.

Yeah, way different. I was just thinking of a Maker controlled MKR/DAI pool that is freely tradable on the market but only Maker can add/remove liquidity, which might be nice to tap into for MKR payments

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@Uncle That is MIP31? Right?

Please feel free to add feedback there.

Actually Day is better for the protocol, we lend all Dai as backed value. More dai are out more money we make.

yes - but this is related to tax purposes. Holding MKR passively = capital gain ->capital gain tax (maybe 25-28%). Actively using MKR for voting and getting compensated could result in this getting taxed as work (!!!) = tax of 30-50% !!!. This “interpretation” is what we need to avoid. Compensating with MKR is better in that regard, but not a potential show-stopper.

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Oh, I have already expressed my point of view on it.


@cmooney @brianmcmichael :eyes:

Assuming veMKR ever comes into fruition :slight_smile:

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There is another MIP for this one probably MIP42

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This sounds like a Yearn Vault material. It could claim the DAI rewards and use them to buy and compound the underlying MKR amount.