P4 – New Staking Rewards Formula

I agree with this proposal

3 Likes

Wow amazing, thanks team

1 Like

This is a good development

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This proposal will attract long term stakers

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I really like this proposal, let’s do it!

1 Like

this is awesome, it will be good for long term stakers

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I think this will have a very positive impact on the project.

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Overall, the idea is good. It could have a positive impact on stakers in the long run. We’re looking forward to the launch of voting on this topic.

1 Like

What benefits can be obtained by staking wct?

3 Likes

Next generasi

Good job

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Good proposal.Very good.

2 Likes

Overall, I believe this proposal is a strong and well-considered step toward improving the sustainability and attractiveness of WalletConnect staking. The introduction of a power-law based APY model is an interesting and promising approach.

:white_check_mark: Positive aspects

1. Strong early-stage and low-participation incentives
The new formula provides higher APY when total staked weight is low, which is very effective for bootstrapping participation and maintaining engagement during slower market periods. This should help keep the network attractive even when overall activity declines.

2. Better long-term sustainability
As participation increases, the APY naturally decreases, which helps control emissions and supports the long-term health of the network. This adaptive behavior is a meaningful improvement over a flat or overly rigid rewards structure.

3. Encouragement of long-term commitment
By shaping rewards around network conditions rather than fixed targets, the model appears to better reward long-term stakers and consistent participation, which is aligned with the goals of network security and stability.

:warning: Points that could be improved or clarified

1. More transparency around parameters and assumptions
It would be very helpful to provide additional explanation on how the constants (e.g., A and B) were chosen, what data or scenarios they are based on, and how often they might be reviewed. This would improve trust and make the model easier for the community to evaluate.

2. Risk communication around very high APY ranges
In low-stake scenarios, the model can imply very high APYs. While this is attractive, it would be good to also clearly discuss potential risks, such as inflationary pressure, short-term farming behavior, or market impact, so participants can make more informed decisions.

3. Guardrails and extreme cases
Consider clarifying whether there are soft or hard bounds on APY outcomes, or what governance mechanisms would be used if the formula produced extreme or unintended results.

4. Tooling and simulations for the community
Providing simple charts, tables, or an interactive simulator comparing the old and new formulas across different staking levels would greatly improve understanding and allow stakers to better anticipate real-world outcomes.

:compass: Strategic suggestion

A phased or closely monitored rollout could be valuable — for example, introducing the new formula with a defined evaluation period, during which real network data is reviewed and parameters can be adjusted if needed based on observed behavior.

:+1: Conclusion

The proposed power-law reward formula has the potential to significantly improve staking dynamics, incentivize participation during weak periods, and enhance long-term network sustainability. With clearer documentation, explicit discussion of risks, and accessible simulation tools, this proposal would likely gain broader confidence and support from the community.

5 Likes

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3 Likes

Good for long term n DCA for staking

3 Likes

I think it’s a good idea to change the APY formula but i would propose to even it out a little more. now its 80% - 8,04% i’d think 40% - 10/11% would be better

1 Like

I think this is a good and needed update.
The old formula was too flat and not very competitive. This new power-law formula makes APY higher when staking is low and reduces it when staking is high, which feels more smart and market-based.
It will attract more stakers in bear market and still stay sustainable in bull market. Overall, I support this change as it improves incentives and long-term alignment. :+1:

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WCT Stakers. That’s very very good

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Typically, how long will we see this proposal is moved to the Voting stage?

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  1. How will the protocol mitigate mercenary capital and subsequent sell pressure? The proposed formula offers a massive 80.5% APY at lower stakeweights. This is a magnet for yield farmers who stake for short-term gains and immediately dump rewards. How does the Treasury plan to manage the potential surge in circulating supply during this high emission phase to prevent a death spiral for WCT?
  2. Why is the decay more aggressive than the linear model at high participation levels? Under the new formula, once the network hits 50M+ stWCT, the APY drops significantly lower than the original linear model (e.g. 12.7% vs 17.7%). Doesn’t this tax the network’s success and potentially disincentivise new long-term participants from joining once the ecosystem has matured?
  3. How about implementing an APY smoothing or guardrail mechanism? Instead of a pure power law function, consider a hybrid model or a cap and floor system.
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Huge for wct stakers

3 Likes