[PROPOSAL #52][REJECTED] ATOM 🤝 Osmosis: Allocate Community Pool to ATOM Liquidity Incentives

• Moderator edit to add link to on-chain proposal: Mintscan - Chain explorer by COSMOSTATION [ATOM Osmosis: Allocate Community Pool to ATOM Liquidity Incentives] Proposer: Sikka [ATOMs should be the base money of Cosmos, just like ETH is the base money of the entire Ethereum DeFi ecosystem. ATOM is currently well-positioned to play this role among Cosmos assets because it has the highest market cap, most liquidity, largest brand, and many integrations with fiat onramps. ATOM is the gateway to Cosmos. In the Cosmos Hub Port City vision, ATOMs are pitched as equity in the Cosmos Hub. However, this alone is insufficient to establish ATOM as the base currency of the Cosmos ecosystem as a whole. Instead, the ATOM community must work to actively promote the use of ATOMs throughout the Cosmos ecosystem, rather than passively relying on the Hub’s reputation to create ATOM’s value. In order to cement the role of ATOMs in Cosmos DeFi, the Cosmos Hub should leverage its community pool to help align incentives with other protocols within the Cosmos ecosystem. We propose beginning this initiative by using the community pool ATOMs to incentivize deep ATOM base-pair liquidity pools…

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I will be voting no on this for now. I think we need to have a unified view of how and when to spend funds from the community pool for LP rewards, not just for Osmosis, but for all the other DEXes that will ask as well in the future. At the very least I think we should wait to subsidize AMM/lps until the gravity bridge is live and working, so liquidity can come in from the Eth ecosystem to earn yield as well. This would also help get more DeFi users from Eth familiar with the Cosmos ecosystem.

You have my support, but I saw a vote No with Veto. Not sure if it means, what I think it means. Any thing to add?

We at Tendermint believe that having more than one healthy cross-chain DEX in the Cosmos ecosystem is bullish for DeFi in the interchain. We are extremely supportive of the work and effort from the Osmosis team, and we ultimately believe that Cosmos Hub support for liquidity growth in ATOM pairs in various DEXs makes a lot of sense. However, the Tendermint team is making a recommendation against Prop 52 because this is not the right time to decide on this topic. • Most importantly, Osmosis has already succeeded at being a major ATOM trading locale. The ATOM/OSMO pool has $16.6M in liquidity, and over $1M volume in 24 hours, which is close to 1% of all ATOM trading volume, less than a month after launch. A $1M grant to incentivise more liquidity does not seem necessary in such a vibrant market, or likely to be a significant driver. • The determination of how much and when/where to deploy ATOM incentives on various DEXs should be after the Gravity DEX pools are established and settled. Gravity DEX’s deployment will change a lot of features of the trading environment, and the Cosmos Hub community should have all possible data to support deciding where to deploy incentives. • The…

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Dear Cosmos community, The Citizen Cosmos validator has voted ‘no’ on prop 52: • To our knowledge, there are no previously studied cases in the crypto space, where the base asset of a network is given as an incentive for farming. I.E. ETH is never given as an incentive for providing liquidity in a farm, for let’s say, the ANT/ANJ pair or the ANT/YFI pair, etc. This puts us in an unclear situation, where we cannot measure the possible risks this actions might cause to ATOM. In our opinion, handing out ATOM to the same players on the market that already have ATOM will, most likely, cause these players to carry on dumping the asset onto the market. Hence, leading to more weak hands. This is just simple reward / 0 at stake psychology. We need more new hands, not handing out ATOM to those already in possession of ATOM for the sake of handing out ATOM - this will NOT make the token more attractive, but rather the opposite. • The natural distribution of OSMO is yet unfinished. It is hard to make any decisions or any judgments based upon the existing statistics of ‘5 minutes ago’. We, the ATOM community, need more time to study the case and the economic behavior of these…

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