This forum post is to discuss the upcoming Governance proposal for SOMM incentives to bootstrap liquidity for the SOMM-nUSDC concentrated liquidity pair (pool 1372) on Osmosis. This proposal is set to go to vote on Monday, January 15, 2024.
Description
This proposal is intended to authorize a one-time transfer of 122,500 SOMM from the community pool to a to-be-created multi-sig address [TBD] on Sommelier. These tokens will be used to incentivize liquidity on Osmosis, the largest DEX in the Cosmos ecosystem and predominant SOMM liquidity hub over a period of 60 days. The total amount of tokens for the proposed program represents 0.102% of the tokens in the community pool.
The SOMM-nUSDC pair is different from the existing SOMM liquidity options in that it pairs SOMM against a stablecoin rather than against another volatile crypto asset. Therefore, rewards to bootstrap this pool provide yet another option for those interested in providing SOMM liquidity. Additionally, deep token liquidity is critical for enabling SOMM integrations in other DeFi applications within the Cosmos ecosystem as it is required for liquidations, oracles, etc.
In the future, Sommelier may want to launch similar programs on Osmosis with different parameters - any future program is outside of the scope of this governance action and will require a new proposal. In the event that there are unused funds, those funds will be returned to the community pool.
The multi-sig will be composed of a mix of early developers on the Sommelier Chain as well as contributors to the Sommelier ecosystem. An updated list with the participants in the multi-sig will be listed below:
This proposal, if accepted, will spend 122,500 SOMM from the community pool to a to-be-created multi-sig address [TBD] on Sommelier, to be distributed to incentivize liquidity for the SOMM-nUSDC concentrated liquidity pair (pool 1372) on Osmosis over a period of 60 days.