I'd like to propose a new way that we can utilise GVT in GV Funds instead of the current system.
I believe the 1% mandatory hold in Funds is undesirable because it does not permanently remove the token from circulation. When an investor joins a Fund, 1% is allocated to GVT. When the investor leaves, the 1% is now sold. There is no benefit at all to GVT holders. Additionally, when a manager rebalances their fund, if GVT has risen in value, it is sold to maintain the 1% requirement when a manager rebalances their Fund. Obviously this means that when GVT drops in value, there is more being bought. But, with utility tokens, it’s important to reduce velocity. The team removed a majority of this velocity when they added multi-currency support to the platform, but I think we can improve it further.
When Funds are rebalanced, they pay fees to Binance/Huobi to execute the transaction. For example, when I rebalanced my DeFi Basket Fund today, I added 50 AAVE with a fee of 0.15 AAVE paid. This is approximately 0.3%. I propose that we add a fee (0.1-0.2%? 0.4-0.5% total?), which is used to buy GVT and hold until the end of the quarter, then sent to the burn address. By adding AAVE to my Fund, approx. 2 GVT would have been purchased and removed from supply forever. This means that there is only buying pressure from the use of GV Funds.
The team can charge the additional fee as a right to use the Funds product. It would not be a hindrance on usability, and we are removing the mandatory holding of a particular asset in a Fund.
If you do consider this, it would be good to put it to the community first to gauge proper sentiment.
Thank you for your time.
Customer support service by UserEcho