I don’t believe that putting all the eggs in a single basket is the best choice and both services seems to offer serious solutions. Something around 50 / 50, if possible, would be my choice.
Thanks for the answers.
Trial time to be set by DAO voting. 1-3-6 months
thanks, Arrakis proposal is very interesting and well detailed but I am wondering if any other proposals will be suggested ?
I am only interested in the benefits the community enjoys, what will be specific
If both providers are to provide liquidity for HOPR/ETH pair would they in anyway interfere with each others results?
Hi there (esp. to Gamma & Arrakis)
Thanks for your proposal. I think they are, in terms of why we need a a professional liquidity service provider, well formulated. I have some questions relating to the following:
- I can read about the fees. I think that most understand the basic concept. However, I would love to see whether the liquiditiy service provider could be incentivized according to the role he plays for guaranteeing price stability. And if no action is needed, no costs should result for HOPR. Is this something realistic to think of?
- I read that ETH pair is most important and focus should be given to it. Can you spend a few words on the pair with DAI? I experienced it to be a very convenient trading pair and would hope to see it growing in importance.
- HOPR is listed in Coinbase. How does a centralized exchange guarantee liquidity? Can they have issues regarding it or not?
We can guarantee a certain price impact based on trade size amount as that is deterministic based on the ranges that we use. In terms of price stability, we would not be able to gauge that reliably. However, if the DAO were to come to us and say, we want no more than 2% price impact on a 100K purchase, we could most certainly get that done with the current amount of liquidity. In terms of costs, 15% of the swap fees and rebalancing fees is really a minor portion. It’s important to note that Gamma does not charge anything on the liquidity itself, but only takes 15% of swap fee revenue.
So there are pros and cons to using ETH or DAI, which I can illustrate below:
More correlated with HOPR, so a tighter range can be used with less impermanent loss
ETH is the most paired asset on Uniswap, so pairing with ETH would allow for very efficient trade routing
- It’s a volatile asset pair, so the price of HOPR would likely be dragged up or down by ETH volatility
- Price stability - Pairing with DAI is essentially pairing to USD, so there’s less correlation with the volatility of ETH
Less correlation with HOPR, means a wider range should be used to mitigate the effects of IL
DAI is not paired with as many assets as ETH is, so there would be marginally less efficient routing
If I’m not mistaken, GSR is the centralized exchange market maker. Typically these arrangements are loan and option models where a market maker like GSR is loaned some HOPR tokens and use those to market make on a variety of exchanges to provide depth of liquidity. I don’t think any centralized exchange can guarantee liquidity, but the market makers are incentivized to have it there.
I think it is a good idea to have both compete in AMA. Furthermore, I think the percentage of liquidity provided here should be reviewed on a case-by-case basis. I think it would be a good idea to consider the effect of the service and the growth of HOPR to eventually move to one side or the other after a trial period.
Might be an interesting experiment. I don’t have any experience with them yet, so I can’t say yet in what proportions liquidity can be divided.
put xToken on the list too!
Gamma has been very active in responding to the community which was very positive. Most if not all fud was addressed. In the beginning I was very pro Arrakis. I do now have some concerns from Arrakis’ proposal. They will be running a v2 which no one has really used yet. Even with a couple audits without any real live data on their v2 it’s hard to support Arrakis fully.
It’s difficult for me to trust Gamma aftes the failure of Visor and Arrakis doesn’t convince me either. 1 year fees for the liquidity seems too much to me.
security and infrastructure must come first