Updating the reward computation

[julien51]

Context

In the initial design of the protocol reward, the protocol distributes tokens based on 2 aspects:

• the "growth" contributed to the network in terms of revenues
• capped by the has spent by the transaction.

The initial idea was that we needed to find a way to reward based on the economic contribution but make sure that there is no benefit to abuse the protocol by sending "fake" transactions, since the gas paid is more than the value of the governance tokens received.
At this point, the main consequence of this is that it penalizes the use of low gas networks like L2, because the reward will be lower on these for the same value contributed on a network with high gas costs.

Consequence

Therefore, we should remove the cap based on gas, and change it to a cap based on the fee paid. Since the protocol now has fees, the reward should be based on the fee paid.

The fee is also proportional to the value contributed, so to simplify things, we should replace both measures by a computation of the reward based on the fee. However, in order to incentivize recipients to "hold" on to the tokens they receive, the reward received should be 1/2 of the value of the fee paid.
Example: For a 10 USDC transaction, if the fee is 1%, then the reward should be $0.50 worth of governance tokens.
Of course, if a fee is taken in a token for which we don't have a "conversion" to the governance token, then, no reward should be disyributed.

[Nwachimereze1-hub]

Context

In the initial design of the protocol reward, the protocol distributes tokens based on 2 aspects:

• the "growth" contributed to the network in terms of revenues
• capped by the has spent by the transaction.

The initial idea was that we needed to find a way to reward based on the economic contribution but make sure that there is no benefit to abuse the protocol by sending "fake" transactions, since the gas paid is more than the value of the governance tokens received. At this point, the main consequence of this is that it penalizes the use of low gas networks like L2, because the reward will be lower on these for the same value contributed on a network with high gas costs.

Consequence

Therefore, we should remove the cap based on gas, and change it to a cap based on the fee paid. Since the protocol now has fees, the reward should be based on the fee paid.

The fee is also proportional to the value contributed, so to simplify things, we should replace both measures by a computation of the reward based on the fee. However, in order to incentivize recipients to "hold" on to the tokens they receive, the reward received should be 1/2 of the value of the fee paid. Example: For a 10 USDC transaction, if the fee is 1%, then the reward should be $0.50 worth of governance tokens. Of course, if a fee is taken in a token for which we don't have a "conversion" to the governance token, then, no reward should be disyributed.