Proposal for external incentives on Osmosis

I am proposing that we provide external incentives for the SOMM/OSMO liquidity pool on Osmosis. With all the positive excitement around the proposed staking rewards, I think it’s important to also incentivize those who provide liquidity on Osmosis. This is a popular and successful feature on Osmosis, and it will provide more reasons for people to hold the SOMM token. This proposal will have a positive impact on the Sommelier project; I was thinking about it a while back, and now I want to take the chance to be proactive about it.

With that said, I drafted the following language and I hope I can get some advice/input:

I have left the amount of SOMM and duration of the rewards open because I would like some advice/input. I feel the start date should be before the staking rewards go live, because it’s clear that already there’s a lot of increased demand for the SOMM token. However, I welcome the good advice of people with more experience than me. I would also gladly volunteer to be part of any multi-sig, and I am sure there are other individuals that the community knows and trusts to help with that.

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Fee auctions will also be starting at the same time as staking rewards.

The initial auction looks like 2.6k of fees but somm liquidity will be needed for people to participate in the auctions which we expect there to ongoing to demand for somm liquidity for this.

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Very supportive of moving forward.

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Great initiative, very much in support of adding external incentives to liquidity providers!

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