Hey guys, we’d like to add support for the DMG-WETH pair for yield farming, so we can encourage growth in liquidity for it on Uniswap. Doing so would be a good interim staking mechanism for DMG, and a good use of liquidity. The APR (denominated in DMG) would be about 20%, using the current price of DMG ~$0.25. If the price goes up, the APR will go up too.
What are the community’s thoughts in making this available?
Why not pair it with USDC or USDT ? Paring it with ETH just makes the price fluctuate alongside ETH, if it’s paired with a stablecoin the price will not fluctuate from the market moves, and get it’s own pace easier over time.
What staking mechanism are you referring to?
I thought there is no staking for DMG holders only mTokens were getting returns.
Please can you kindly clarify?
Thanks
I prefer having m tokens for liquidity - so a DMG to m token first.
I agree with Russ. Lets do a DMG to mToken first (helps the ecosystem). How long will the interim be? When can we expect straight DMG staking?
Thanks!
Anything that is using DMG is ok for me. We need more functions for the token, hope staking is here soon
There is already a lot of liquidity on the ETH pair due to the team’s LP. Would this imply the intention is to eventually remove that? If not, I think it’s better that these pool 2 incentives be within a stablecoin pool instead. And while you’re at that, might as well make them mTokens. Otherwise it doesn’t even increase the mToken TVL, which ought to be where liquidity incentives are focused anyway.
I don’t see how this attracts any liquidity regardless though. Not many would try to straddle impermanent loss on a 10m market cap token for 20% APR. You either buy or you don’t. Also just about everyone is wary of buying into pool 2s now so as a contingency short-term measure for price it won’t do anything.
As much as I like the DMG yield I am receiving from these farms, I wonder how necessary providing liquidity is for these pairs (although DMG-ETH might be the most important) when the underlying mTokens are not being bought. Does the team believe it is gaining a lot from having mUSDC-USDC, mETH-ETH, Liquidity on Uniswap relative to the cost? If not than I don’t know why they would want to add another pool. I do think that if there is going to be yield farming of mTokens and other assets that DMG-ETH is a good one to have, especially if the team plans to remove their Liquidity from Uniswap
Maybe a balancer Smart Pool ( AMPL is the only pool that does this at the moment ) or Bancor 2.1 would fit better, uniswap 50%-50% distribution, is not attractive for holders, as the impernanent loss is really tricky.
Bancor 2.1 claims it allows providing liquidity in only 1 token, which might also make it simple to allow liquidity providers to vote, as long-term holders will have all the incentives to just drop all their tokens in Bancor and have liquidity in the market for a stable price ( I’m not sure what the risks would be right now, for both Bancor or giving Votes to LPs )
Any news on this ? it would be great to get it started already, uniswap DMG-WETH is great, would be cool if existent LP providers can use their UNI tokens to farm the yield instead of doing it trough the interface like the mToken - Token pairing
We’re going to do something with Bancor once v2.1 is live and have been chatting with them.
We’re thinking about doing DMG-WETH, because it would encourage adding liquidity to it while not getting potentially rekt by IL. The team sees the Uniswap DMG-WETH pool as a market trendsetter at the moment, and many MMs seem to use it for rebalancing, arbing, etc. More liquidity on there has generally lead to stronger market dynamics.
Our intention is not to withdraw our liquidity. Rather, our intention is to encourage positive action for the community to help grow the project.
In the long-term having liquidity on a place like Uniswap for mUSDC-USDC (mToken-token) is actually really important. Why? Assuming we have a fluid system and much more adoption for mTokens, the secondary market acts as a failsafe if there is a theoretical run on the bank (the DMM smart contracts, which serves as the primary market).
Suppose everyone withdraws their funds all at once. We can use Uniswap as a backup for people to still swap from mToken to token at a premium, instead of waiting for liquidity to get added back to the smart contracts. If there is excess demand for an mToken, people can also get access to it on Uniswap then.
As we onboard more serious institutional integrations, they’re going to be looking for solutions like this as a liquidity failsafe.
This makes sense - thanks for the clarification
Agree on this- having a secondary market is a nice failsafe and allows for the funds locked in m tokens to continue to be loaned out, amidst trades with other sources of liquidity.
We need more value for the DMG token because governance alone is not enough. Anything that helps create value to utilize DMG token is fine with me