Conditions are hard to digest sometimes, lead actors have very strong subjective opinions about destinations. Listen to the professionals, but you must digest your own narrative, speculate on the destination that you see, and survive long enough for the time horizon to be realized.

I believe Solidly tokenomics inverted the optimal rebase implementation. Circulating supply was the target, whereas maximum alignment would be a rebase against locked ve supply being considerate of newly locked assets after the last epoch snapshot. That's dilution protection. The rebase calculation currently implemented is too simply and needs an equal distribution of assets across the ve userbase to avoid over allocating voting rights to newly locked assets sourced from inflation. Newly locked ve assets have an unfair advantage.

I have reviewed production behavior for Solidly tokenomics. Aside from base layer bribes being non functional, the rebasing functionality is flawed. I'll be frank... I know monetary policy, I know tokenomics, and the calculation is incorrect to achieve the desired effect. An original attempt to convey the flaw was reported here.

Andre's response highlights the flaw that is present in production behavior, clarified in the next tweet.

github.com/solidlyexchang…

Single sided pooling: full risk on exposure, full upside & downside coupled with yield + protocol incentives

Stable coin pair pooling: muted upside & downside, more stable $ valuation coupled with yield + protocol incentives Asset pair pooling: muted upside & downside, more stable $ valuation than a full risk on position, but less $ stable than when pairing with a stable coin. Yield + protocol incentives, no doubt.

The terminology used in #DeFi is misleading. Put into legacy financial terms we have means of capitalizing on vol generating double digit yield, incentivized by inflation neutral monetary policy systems designed to ramp monetary velocity beyond Central Banking's wildest dreams. Icing on the cake -> These systems also manage risk by restricting the affect of volatility on a portfolio. Acting much like an options straddle both appreciation & depreciation is muted in exchange for lucratively capitalizing on vol.