LEAP-14: Reimburse LYRA to LPs

Author	jake
Status	Implemented
Created	2022-01-12

Simple Summary

Core contributors discovered a bug in the off-chain script used to calculate LYRA rewards for LPs of market pools. This resulted in 179,332 LYRA being distributed incorrectly. This LEAP proposes that LPs are reimbursed the 179,332 LYRA in the upcoming token distribution on Fri Jan 14 2022 07:00 UTC. These tokens will come from the Liquidity Rewards distribution.

Abstract

The bug in question can be found in the lyra-lp rewards script. LPs who requested withdraw but did not execute their withdraw before the next round started were still included in reward distribution for the next round, despite their liquidity not being locked in the pool. Over the 5 rounds of liquidity provision for markets, this accounted for misallocation of 179,332 LYRA, meaning some LPs were over and under-rewarded. This LEAP proposes that under-rewarded LPs are reimbursed the 179,332 LYRA and that over-rewarded LPs are not slashed or penalized in any way (as it is impractical to do so). LPs will be reimbursed in the upcoming token distribution on Fri Jan 14 2022 07:00 UTC from the Liquidity Rewards distribution.

Motivation

LPs that were under-rewarded deserve their fair share of rewards for providing liquidity.

Specification

Overview

The script used to calculate rewards will be modified to determine how much each LP was under-rewarded in past rounds. A distribution event will be created specifically for under-rewarded LPs. The bug will be fixed for all future rounds. These changes will be published to the lyra-lp rewards script.

Configurable Values

179,332 LYRA was misallocated and will be rebistributed to LPs.