As part of the discussions with my proposal Thoughts on incentives and community building, i have spoken with multiple players in the space and have come to the conclusion with many that for a successful deployment of the community pool we also need to increase the current tax rate that is charged in order to have a larger pool of funds to use for future deployments.The current tax rate is 2% which we would propose raising to 10%, we have spoken to multiple validators and community members in the space who all see the value in being charged a higher tax rate in the near term to be able to fund the ecosystem in the more long term.
The reason for the increase is that there are several interesting projects in the space that could benefit from liquidity but at current prices the pool is only roughly ~$5-7 million. The pool should be relatively price agnostic as we want to cast a wide net with the amount of projects we can support and thusly ingrain TIA in the ecosystem
After these discussions and before bringing it to vote, iād love to hear the opinions of the more broader community.
The reason for the increase is that there are several interesting projects in the space that could benefit from liquidity but at current prices the pool is only roughly ~$5-7 million.
Can you please elaborate on the interesting projects?
Why is ~$5-7M insufficient to fund projects and what amount is necessary?
The only successful community spend proposal was Pay for IBC middleware audits which cost 8,568 TIA (approx. $55,000 USD). The community pool currently has 1,259,068 TIA ($7,302,598 USD). In other words, the community pool has enough TIA to approve 146 similar community spend proposals.
As highlight in this post there are several projects looking to use $TIA on the base level. Additionally there are notable defi projects in the space looking to support TIA at the core. Think AMMs, lending protocols, interest rate derivatives for TIA stakers etc not just in the cosmos ecosystem but more eth aligned. For large players like this they require more support liquidity than say $55k to work efficiently. For example for a liquid AMM pair it would require at least $1 mil right off the bat. Healthy markets require deep liquidity and to cast a wide net these $7 mil are not enough.