SUNDAE is currently the governance token of the SundaeSwap protocol. As V4 and the broader Sundae ecosystem develop, should the DAO explore stronger utility and value-accrual mechanisms that give users a clearer reason to hold, lock, and participate in SUNDAE governance?
Potential ideas could include fee discounts, liquidity gauges, governance over incentives and treasury revenue, locked-SUNDAE rewards, protocol-owned liquidity, buybacks, or burns. No mechanism is being proposed today; each would require its own detailed proposal and vote.
Poll
Should the Sundae DAO explore stronger utility and value-accrual mechanisms for SUNDAE?
The SUNDAE token already governs incentives and treasury revenue; Locked SUNDAE already earns rewards (a share of protocol revenue); the SUNDAE treasury already has protocol owned liquidity.
That being said, I’m not sure what “liquidity gauges” means?
Put more directly, I am asking whether locking SUNDAE and actively participating in governance should become more rewarding as the protocol grows. I recognize that SUNDAE already has governance rights and locked holder rewards, and that V4 will improve incentive allocation. The question is whether those existing mechanisms are enough or whether the DAO should explore additional benefits for long term committed participants.
First, whether the current rewards for locking SUNDAE are compelling enough to encourage long term participation. SUNDAE already has governance and revenue rewards, but I would like to understand whether those benefits are expected to grow as the protocol grows.
Second, how future V4 activity and new liquidity opportunities will connect to SUNDAE holders. If they generate more protocol revenue, should the DAO consider ways to strengthen the benefit for users who lock SUNDAE and actively participate in governance?
I am not proposing a specific mechanism. I am asking whether the current structure is enough or should be improved over time.
From my perspective, the SundaeSwap team has made several efforts to engage platform users in governance participation, however it remains low. I would argue that this is a chicken vs egg challenge in the present economic environment. The egg in this case is the past price trend of the SUNDAE token.
Recent changes in support of making yield rewards more sustainable seem to be working. They are helping both stabilize the price of SUNDAE and maybe even reverse the trend and created a price appreciation trajectory.
If SUNDAE becomes more valuable, then engagement will follow.
There was a past idea to limit protocol revenue share to SUNDAE holders that participated in governance voting, but that limitation is not get built (to my best knowledge). The intention was to add an incentive for users to vote on proposals. The v3 UI currently shows these rewards in the users “Portfolio > Votes” tab.
Protocol growth is closely connected to Cardano’s overall network health. We are in bear market atm and chain activity is not what it can be. With all the new services SundaeSwap is bringing online and IF we can get chain activity growth at the same time THEN protocol growth will follow.