This proposal would directly remove OSMO incentives from stIBCX pairings.
Background
Osmosis governance removed incentives from most pools in Proposal 638. stIBCX maintained incentives due to its recent launch, and due to being composed of other assets that maintained incentives.
stIBCX is the only non-Quote asset currently incentivized by Osmosis in a non-derivative pairing.
As can be seen in the Incentives Adjustment for March 2024, the Liquidity Provider Fee Subsidy Rate is currently 500%, meaning that these pools are incentivized by 1 OSMO for every 0.2 OSMO of fees paid to LPs.
These high subsidy rates are intended to be a short-term bootstrapping mechanism and stIBCX has not reached self-sustaining liquidity or volume in six months.
Similarly, this lack of volume means that Osmosis is still well below the breakeven point for emissions, spending 15x what is generated from Taker Fees.
As stIBCX liquidity has stagnated over the past six months, this proposal asks that the Osmosis incentive spend on this grouping be ended as an inefficient spend with no resulting liquidity increase.
Target On-chain Date: 18th March 2024