With the launch of the PowerIndex right around the corner, our team has been spending more time finalizing a few tweaks to hopefully help make the launch as successful as possible. At the beginning of this week, we published an in-depth proposal to PowerPool’s forum (which we also sent to clients here). Following up, we wanted to make 2 modifications to this proposal.
The first modification is to increase the Power Index rewards during months 1 and 2. The current proposal has monthly rewards at 400k CVP for the foreseeable future. We would like to increase rewards to 1M CVP in the first month and 700k CVP in the second month. The purpose of this adjustment is to help kickstart the flywheel described above by incentivizing capital to flow into the index early on through a strong yield. This would create strong demand for CVP since its an equally weighted index, which would continue to bolster index reward yields and drive more capital into the index. We visualize the increase this would lead to in circulating supply below in teal, and it’s clearly negligible. Since it’s in the early days, it also comes at a time when it’s most impactful, making the relative value of this slight increase in supply that much higher.