January Wrap-Up
Ahoy, maties!
Another quarter is behind us, and the pirates have weathered another storm. The market is showing some signs of life, with people talking and new faces appearing in Discord daily.
The team didn’t slow down. We planned, built, and shipped through the entire bear market.
Let’s hoist the colors and get started.
The Great Restructuring
On January 23rd, the good doctor posted an announcement. We are officially cutting back APRs on our legacy pools to reduce inflation. The recent move got us down to 30%, and we’d like to get to 20% by the end of Q2 2023.
“As part of our plan to focus on sustainable paths to generate revenues in order to reduce our dependence on inflation, we just executed a full revamp of our farms. Yields have been drying up everywhere and is impacting our revenue by quite a big margin.
A couple of points:
We will focus on bribing to scale our LQDR liquidity instead of direct LQDR spending into our own pools.
Target APR for remaining traditional pools will be actively managed with a crawling peg, meaning we will try to keep in within a range of + 20% from the yields offered on our partner’s DEX”
This is all part of our plan to move from an inflationary model to an emissionless version, which will help Liquid Driver with long-term sustainability.
What does this mean for users?
Going forward, we’re implementing a three-pronged attack. The first focuses on Shadow Farms, the second is utilizing the capital efficiency of the bribing mechanism on Solidly forks, and the third is the new “profit maxi” Liquid Wrappers.
For nearly two years, our users have farmed LQDR as hard as possible. Now it’s time to make some moves with your gains. We’re encouraging pirates to try out the Pirate Party pool on Beethoven X. It’s a weighted 80/20 pool with less impermanent loss than the standard 50/50 model. We’re currently incentivizing this pool with LQDR, and Beethoven X is matching it with BEETS. This is a temporary arrangement. Once the pool generates enough volume, the votes will be capped, and we can move back to bribing fBEETS voters.
We hope to grow the liquidity here to attract more attention to the pool and hopefully raise fees for the LPs.
Per a recent announcement -
“As a bonus, the pool now has lowered swap fees (and possibly lowered further), meaning the volume and thus fees could increase significantly as more swaps are routed through it.”
Upcoming Product Releases
With each passing day, we come closer to releasing our newest products, which make up the second prong of our attack. The first live product will be liveTHE, directly followed by liveEQUAL and liveVELO.
Why are these wrappers so powerful, and why are we so excited?
Well, first of all, because it is the latest evolution of Liquid Wrappers. Secondly, they’re what we like to call a “pure profit” product — meaning there is:
- No LQDR used to make it happen or incentivize
- Possesses long-term sustainability
- Is beneficial to Liquid Driver, xLQDR holders, and our partner projects
- The models can easily be replicated to fit the needs of new partners — and maybe even future partners with a little something extra going on ;)
Unfortunately, there’s no such thing as a free lunch. Dr. Liquid has tigers to feed.
In the case of liveTHE, there is a performance fee of 18.5%. 10% for the purpose of self-bribing the liquidity pool, and 8.5% which will be distributed to xLQDR holders. Despite these fees, our wrappers will still perform similarly to the traditional lock-and-vote model that most, if not all, of us are familiar with.
Moving out of your locked veTHE position will come with a penalty fee. This is to deincentivize users who want to liquidate and dump their position and to help sustain the product’s peg.
There will also be a weekly cap on supply for the same reason. These fees will likely be waived for the first week to build up liquidity. Users will have two options. You can stake your liveTHE or LP it with THE for THE rewards.
And the Gods Descended
For the last several weeks, Liquid Driver has used its bribing power to vote for its own pool on Thena. Now we’ll start bribing pools that will be the most profitable to our xLQDR holders. That’s what you guys locked up for, right?
We’re about to deliver.
Starting with the next epoch, we will begin optimizing a share of our votes for max revenue for our holders. Now that emissions are slowly decreasing on Thena, we feel this is the best time to adjust the strategy, as we’re happy with our current veTHE holdings.
That being said, you know we love our capital efficiency. So we’ll continue to bribe Equalizer and Thena weekly for the foreseeable future.
Sailing Forward — The Cross-Chain Future
The future of LQDR looks really bright with our shadowfarm and live wrapper combo strategy.
LQDR is building an empire. We’re after ownership in multiple DEXs on multiple chains. We will deploy wrappers across multiple chains.
There will be an abundance of revenue streams for xLQDR holders.
And Shadow Farms V2.
I’m done, guys. There’s only so much excitement one group of pirates can take.
