Shield Mining Rewards Update #2

The Problem

Shield mining is rewarding the CLAIM/DAI Balancer pool with too much $COVER, which in turn, drives users to market-buy CLAIM covTokens with the sole intention to shield mine, raising the cost of coverage.

As shown above, the APY for the CLAIM pools is significantly higher than the NOCLAIM pool

The Solution

In ~24 hours, we will adjust the ratio of rewards to CLAIM/NOCLAIM pools from 30/50 => 5/75.

The Goal

By decreasing the allocation to the CLAIM pool and transferring the rewards to the NOCLAIM pool, we want to facilitate equal APYs between the CLAIM and NOCLAIM pools. This will remove the incentive for users to outright buy CLAIM tokens and shield mine, but rather incentivize users to be liquidity providers for both the CLAIM and NOCLAIM pools. This should dramatically reduce the buying pressure on CLAIM tokens and instead make it more affordable for those seeking coverage.

Projected APYs with implemented change and assuming CLAIM and NOCLAIM priced at $0.05 and $0.95 respectively



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