The general direction of this proposal looks good to me. Bolstering RPL liquidity and cross-chain rETH liquidity are both worthy goals. The numbers do seem a little RPL-heavy, though. Especially bringing the RPL/ETH incentive cap up to 50% means RPL liquidity becomes an equivalent goal to rETH liquidity. I think rETH liquidity should still be the primary focus, as the core protocol product.
Some additional questions/remarks on the proposed protocol-owned RPL/ETH liquidity.
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Why choose fully POL here instead of incentives/bribes as has been our approach with rETH?
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Full-range liquidity is less capital efficient than actively managed liquidity ranges (uni v3.) As you mentioned, maybe we should we consider partial ranges around current price as well with a portion of capital. Downsides are of course risk of going outside of range and requiring more active management by the IMC.
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It’s not quite clear to me how relevant the comparison is to the size of Lido’s LDO/wstETH incentives and active liquidity. Shouldn’t this be about the liquidity required for our own goals (a more smooth/stable NO experience around obtaining and selling RPL?) Or do you reckon more liquidity is always better to that end?