I think ultimately this is Balanced Crypto Pie. The question is what is balance.
To me ETH has an upcoming 90% issuance reduction.
Crypto gaming is booming,
DeFi is underwater.
BTC is seeing pushback against POW on environmental front, with a lack of fee growth and nations pushing out miners.
If I were planning rotations, selling DEFI at lows for Play at highs feels in-optimal.
However rotations must be made. Reducing some of that rotation from DEFI++ by shaving down BTC I feel better reflects the market while retaining more exposure to upside we’ve been riding loses to maintain.
At present balance is represent by 3 evenly distributed pillars.
This has an elegance to it we wont maintain shaving down proportionally, but ultimately I think that’s ok.
There is not a lot of liquidity on market of BCP.
$49,090. Its incentives are single asset staking viewed as providing liquidity lower down the stack.
So most users have to redeem BCP to exit. (ETH/BTC/DEFI++)
BCP has 2.2m in in assets providing liquidity for them w/ $207k of that as DEFI++ (w/ no incentives for liquidity elsewhere).
To reduce that to 15% cuts that to below 100k on market (in a three asset pool which has higher slippage than two asset pools, soon to be four asset pool), pushing redemption further down the stack to where liquidity is incentivized.
I think finding ways to keep some liquidity on market is important, unless that’s covered with alternative revamps in farming structure.
Perhaps including ETH in DeFi ++ could natively provide liquidity for +L and +S in such a way that BCP incentivization can also cover liquidity deeper in the stack by proxy without needing additional ETH pair incentives.
Perhaps condensing DeFi++ could help as well.
However at present, too large a reduction in DeFi++ makes it prohibitively hard to enter and exit BCP without high expense or the Oven which is only one way at present.
We should keep this in mind when rebalancing.
To me, with the above considerations, maintaining I’d rather shave down BTC than ETH, but overly shaving DEFI++ may cause problems for users entering and exiting and we should try to offset the impact.