Keep in mind, the assumption that all TVL would shift to the new 3CRV pool if we moved some rewards is not gauranteed.
Think about the original DeFrost-3CRV farm and when we removed the rewards. It became deprecated, yet, if my memory serves me, around $10M TVL stayed in that farm for weeks.
The idea here would be to leave some emissions in the DeFrost Boost Farm to appease those that choose to stay there (we’re already at 3%± APR on that farm, going a little lower won’t make much of a difference at this point in the grand scheme), but also transfer the H2O/AVAX emissions to the new 3CRV pool.
Due to the current composition of the Curve pool having a little over $1M in av3CRV and the current TVL of the DeFrost-3CRV Boost Farm being $16M, we can easily determine that with a new 3CRV pool users would need to close some of their H2O positions if they want to participate. Through this new 3CRV pool we would be making it so beyond the H2O vaults the only way the lion’s share of the MELT emissions become accessible to users is through depositing USDT/USDC/DAI into the new 3CRV DeFrost pool which would directly then benefit the disproportionate weights in the Curve pool, and finally, help H2O regain peg.
The team has also been discussing temporarily increasing emissions on av3CRV deposits to mitigate diluted rewards from all TVL shifting to a new pool, and to also ensure the rewards are incentivized enough.
All of this would need to be voted on via governance.
I will revert back to the fact of the matter here; the only way H2O remains sustainible at peg, is if there is more av3CRV in the Curve pool. The only way we get more av3CRV in the Curve pool is by incentivizing USDT/DAI/USDC deposits.
We can talk all day about maybe this will happen or maybe that will happen…The fact above still remains.
If anyone has a better idea on how to incentivize av3CRV deposits, I’m all ears. Please come forward.
We can’t attack one side of the coin (H2O by increasing stability fees,etc) and completely ignore the other side of the coin, av3CRV weight in the Curve pool, otherwise we’re doomed to a vicious cycle of;
Users using the platform for its intended value proposition, H2O vaults, and de-pegging H2O, again…and again…and again…