tldr; If the LP is too deep, the market price can not move.
The conversation about the LP has been too much focused on the rewards, and not enough focused on how deep the LP should be.
It matters less, whether LPs are getting fat rewards, than whether the LP for our only trading pool is at proper depth.
The fat rewards are designed to offset (hopefully) high impermanent loss, but the price will never move if the LP gets too deep. The dilemma is that when people only look at current price, they might overcrowd the pool. This causes the price to not go up, and while those participants might reap rewards for 12 months, this whole project could just fizzle out if the price doesn’t move for 12 months,
I believe market decentralization - but achieving that is a process. And that is probably what @sumamu is trying to achieve.
Education and gradual steps are crucial. If a bunch of people ape into the LP because of the community fanfare and complaints about fat rewards, without understanding what they are doing, it’s just going to backfire on everyone at large.
The rewards will not be fat, they will just be slightly ahead of sentinel rewards.
The price of ZNN will not be able to increase, which devalues AZ and everyone’s stake.
If by some miracle, the price does overcome of the excessively-deep LP, participants will get rekt by impermanent loss.
I hope some people with more knowledge on this subject will chime in on this frequency.
My observation is that you want between 10%-20% of the value of the circulating supply mcap to be in the LP. With ZNN at such a low and undervalued mcap, we would ideally be at 10%.
I think some people are already having this conversation and some have it in their minds, but it is going over the heads of many, and completely missed by even more.
Is there more advantage to having a thin (right-sized) LP and allowing some people to get fat rewards initially, who will then get rekt by IL while we moon back to $26?
It’s hard to speculate because of the time axis, but does anyone have 1 or more permutations for what ZNN market price needs to reach in order for (LP impermanent loss) + (LP rewards) to breakeven over 12 months?
One of my points is to caution people on having strong opinions that may not be fully informed and knowledgeable.
We have a tendency to form opinions on everything, because we are conditioned to do so.
“You always own the option of having no opinion. There is never any need to get worked up or to trouble your soul about things you can’t control. These things are not asking to be judged by you. Leave them alone.”
Amazing read @mr.ztark! You are right about many things and it’s clear you have a good understanding on how these aspects impact the market. You’d bring a lot of value to the community by sharing more insights and educating us.
One thing I fully agree with is George’s point on more discussion being required. I logged in earlier and was excited to see 11 people in here. I should not be excited to see 11 people lol
To ztarks point earlier I think many votes in these polls would change if they had a better understanding of the dynamics at play
Are you suggesting that opening up the LP will bring in new LPers?
I’m not assuming that’s what you’re saying, but I don’t know I believe that someone who is not already zenonized is going to buy a big bag of ZNN and pair with ETH to collect NoM rewards.
I feel like the LP program is a hedge play and incentivized development program designed for aliens. And that we should manage it as such.
…pursuant to this perspective… How about rewinding and framing it more truthfully: like this:
This is a highly incentivized and high risk program that ZNN Aliens may participate in, in order to bootstrap the ZNN/ETH LP. Only the most knowledgeable and risk tolerant aliens should participate. First come, first served.The pool / rewards / etc will be managed and optimized by Sumamu according to industry standards and with respect for the recommendations of subject matter experts in the community.
This is really how it was, but in hindsight, people seem to be forgetting.
No. I think the affiliate program is great but of course there are challenges in drawing a large number of people to a limited bridge.
Maybe a game would work but not sure what can be deployed in time.
Feels like the marketing aspect is the missing link to this entire thing and with $200 volume over 30 days we’re just waiting hoping someone will ape in.
I agree. The eth pair is awesome and carries deeper implications that will be revealed and I look forward too expounding upon, zoon. Once we have this incredible marketing incentive program that mehowz is building, we are going to start to move forward in a very powerful way.
For those who still didn’t vote, liquidity bootstrap is basically more rewards (which were accumulated during these past months) in addition to orbital rewards, so basically the question is : do you want this bootstrap rewards to be given to the 20 persons providing liquidity or more providers should join.
I get that some people want “thin” liquidity so we can finally “moon” but as you can see since the cap was implemented no one is buying lol
I think what the guys above said makes sense, if we have hella deep liquidity at current price ($1.30ish), it won’t move much even on decent volume which makes our whole task more difficult.
Unless you are expecting some big listing that promotes Zenon very broadly where we get attention from the market (like trending on CG and Twitter) then this isn’t a good idea. We have to build this attention and liquidity up in lockstep and it won’t happen overnight.
and you think when the price pump on thin liquidity, it will be easy to get more lp providers so we can’t prevent dumping on this thin liquidity? it’s not that easy really.
We will end up with a shitty chart just like the one we had before on bsc.
cmc and coingeckop reseted our chart, so let’s grow slowly and steadily and don’t ruin this one again.
I would rather just lock the entire bridge (buys, sells, LP) until affiliate is ready (assuming that is 30 days) then release both in parallel OR just lift all restrictions now.
Maybe Sumamu knew nobody would buy and we would spend 30 days arguing amongst ourselves and they are just doing this for their pleasure.