# GIP-09: Update GFI rewards param for Curve LP **URL:** \ **Category:** Proposals\ **Created:** [March 15, 2022, 12:47am UTC](https://gov.goldfinch.finance/t/gip-09-update-gfi-rewards-param-for-curve-lp/860 "2022-03-15T00:47:05Z")\ **Posts on this page:** 6\ **Page:** 1
**Author:** ![alvinh](https://yyz1.discourse-cdn.com/flex035/user_avatar/gov.goldfinch.finance/alvinh/32/102_2.png) [@alvinh](https://gov.goldfinch.finance/u/alvinh)\ **Post date:** [March 15, 2022, 12:47am UTC](https://gov.goldfinch.finance/t/gip-09-update-gfi-rewards-param-for-curve-lp/860/1 "2022-03-15T00:47:05Z")
# Authors @alvinh, @emilyh # Summary Update the configurable `effectiveMultiplier` parameter in the `StakingRewards` contract from 0.50 to 0.75 on the FIDU-USDC Curve LP positions to be staked for GFI liquidity mining rewards. This is important to properly incentivize liquidity to be deposited into the FIDU-USDC Curve pool by bringing projected APYs of staking the Curve LP position closer inline with staking FIDU-only. # Motivation After the successful governance vote and development of [GIP-01](https://gov.goldfinch.finance/t/gip-01-allow-fidu-usdc-curve-lp-positions-to-be-staked-for-gfi-liquidity-mining-rewards/734), the FIDU-USDC Curve LP factory pool has been created ([Curve.finance](https://curve.fi/factory-crypto/23)). However after discussing with Senior Pool LPs, and doing some [spreadsheet modeling](https://docs.google.com/spreadsheets/d/1E1UiGaRq8U62AXKlwnHnvHdD4y-uk_onXABtTua0J7A/edit?usp=sharing), we’ve realized that we will need to change the `effectiveMultiplier` parameter used to determine award GFI tokens for the staked Curve LP position in order to bring the projected APYs of staking the Curve LP position closer in line with staking FIDU-only, in order to properly incentivize Senior Pool LPs to deposit FIDU-USDC liquidity into the Curve pool. Note: There are no changes to the Goldfinch Senior Pool Liquidity Mining program with this update. # Specifications & Requirements ## Key Requirements 1. Update `effectiveMultiplier` parameter from 0.50 to 0.75 in the `StakingRewards` contract ## Background To support staking the Curve LP token described in [GIP-01](https://gov.goldfinch.finance/t/gip-01-allow-fidu-usdc-curve-lp-positions-to-be-staked-for-gfi-liquidity-mining-rewards/734), we perform an additional calculation at the time of staking to get the exchange rate that will be used to convert the Curve LP tokens to an effective FIDU amount. The exchange rate for a Curve LP position will be calculated using the [virtual price](https://curve.readthedocs.io/factory-pools.html?highlight=virtual#StableSwap.get_virtual_price) of the LP token given by Curve. We use Curve’s virtual price to calculate the effective FIDU amount instead of spot prices or live ratios of the FIDU-USDC Curve pool to prevent flash loan attacks. You can read more details about how Curve has been exploited [here](https://www.chainlinkecosystem.com/ecosystem/curve/). ## Rationale Goldfinch governance should vote to change the `effectiveMultiplier` parameter in order to incentivize users to deposit sufficient liquidity into the FIDU-USDC Curve pool. Changing the parameter value from 0.50 to 0.75 will properly incentivize liquidity to be deposited into the FIDU-USDC Curve pool by bringing projected APYs of staking the Curve LP position closer inline with staking FIDU-only. # Benefits - Incentivizes liquidity deposits on the FIDU-USDC Curve pool by bringing projected APYs of staking the Curve LP position closer inline with staking FIDU-only # Downsides - As Senior Pool APYs and GFI reward APYs fluctuate over time, we may need to make additional periodic updates to the effectiveMultiplier parameter value. These changes will go through governance voting, as the community should decide what behavior to incentivize with the `effectiveMultiplier` parameter. # Voting YES vote: Approve a change to update the `effectiveMultiplier` parameter from 0.50 to 0.75. NO vote: Reject the proposed changes. # Resources [GIP-01: Allow FIDU-USDC Curve LP positions to be staked for GFI liquidity mining rewards](https://gov.goldfinch.finance/t/gip-01-allow-fidu-usdc-curve-lp-positions-to-be-staked-for-gfi-liquidity-mining-rewards/734) [Goldfinch Senior Pool Liquidity Mining program](https://docs.goldfinch.finance/goldfinch/protocol-mechanics/senior-pool-liquidity-mining) ---
**Author:** ![nisa](https://avatars.discourse-cdn.com/v4/letter/n/49beb7/32.png) [@nisa](https://gov.goldfinch.finance/u/nisa)\ **Post date:** [March 16, 2022, 2:43am UTC](https://gov.goldfinch.finance/t/gip-09-update-gfi-rewards-param-for-curve-lp/860/2 "2022-03-16T02:43:33Z")
Hi Alvin/Emily - As usual you are doing great with the proposals - kudos on that. Just to make sure I got this correctly - this proposal is to update the technical parameter for the approved proposal GIP-01 without impact to any rewards distribution or anything - is that correct ? Thanks, ---
**Author:** ![alvinh](https://yyz1.discourse-cdn.com/flex035/user_avatar/gov.goldfinch.finance/alvinh/32/102_2.png) [@alvinh](https://gov.goldfinch.finance/u/alvinh)\ **Post date:** [March 16, 2022, 5:56pm UTC](https://gov.goldfinch.finance/t/gip-09-update-gfi-rewards-param-for-curve-lp/860/3 "2022-03-16T17:56:20Z")
Thanks @nisa ! Yes – this proposal is to update a technical parameter for the approved proposal GIP-01. The updated value will make it so that the GFI rewards for staking the Curve LP position are more closely aligned with the APYs that users receive when staking FIDU-only. If we do not update this parameter, the GFI rewards for staking the Curve LP position will be significantly lower than staking FIDU-only. As a result, it’s unlikely that we see meaningful FIDU-USDC liquidity deposited into the Curve pool, and so the benefits of GIP-01 would not materialize. ---
**Author:** ![nisa](https://avatars.discourse-cdn.com/v4/letter/n/49beb7/32.png) [@nisa](https://gov.goldfinch.finance/u/nisa)\ **Post date:** [March 17, 2022, 3:43pm UTC](https://gov.goldfinch.finance/t/gip-09-update-gfi-rewards-param-for-curve-lp/860/4 "2022-03-17T15:43:10Z")
I thought technical parameter update comes as part of technical implementation after council approval and we did not need an explicit proposal to update that. I might have had wrong assumption on that. I support and vote yes for this proposal because this is an update to technical parameter for the previous approved proposal. Thanks ---
**Author:** ![nisa](https://avatars.discourse-cdn.com/v4/letter/n/49beb7/32.png) [@nisa](https://gov.goldfinch.finance/u/nisa)\ **Post date:** [March 24, 2022, 9:12pm UTC](https://gov.goldfinch.finance/t/gip-09-update-gfi-rewards-param-for-curve-lp/860/5 "2022-03-24T21:12:00Z")
@alvinh - can you push this for snapshot vote ? ---
**Author:** ![nisa](https://avatars.discourse-cdn.com/v4/letter/n/49beb7/32.png) [@nisa](https://gov.goldfinch.finance/u/nisa)\ **Post date:** [March 24, 2022, 9:54pm UTC](https://gov.goldfinch.finance/t/gip-09-update-gfi-rewards-param-for-curve-lp/860/6 "2022-03-24T21:54:28Z")
This proposal is now up for voting on snapshot. [https://snapshot.org/#/goldfinch.eth/proposal/0x478aeb76c14d6d944558fdf4ec68d4cbbeace464f8d1d7364bcd2442e807c73e](https://snapshot.org/#/goldfinch.eth/proposal/0x478aeb76c14d6d944558fdf4ec68d4cbbeace464f8d1d7364bcd2442e807c73e) You have 72 hours to vote ! **edit: 03/29/2022:** Council has approved this proposal !