If a proposal suggests adding $500,000 in liquidity to a pool in, e.g., a DAI-HOPR pair, how do you interpret that?
$500,000 DAI plus equivalent value in HOPR
$250,000 DAI plus equivalent value in HOPR
In a comment on one of our proposals, @satopin writes:
“If there is “68.2m HOPR and 4.7m DAI” liquidity as mentioned in the medium article, and the sum of all the four proposals is 1.35m in liquidity (0.5m + 0.5m + 0.25m + 0.1m), where does the rest of the liquidity of 3.35m go? Is it going to stay in the HOPR-DAI pool on Ethereum?”
I addressed that question in the thread, and will make a separate post, but for now I want to focus on the numbers, because I want to make sure everyone is on the same page.
In that comment, @satopin focuses only on the DAI numbers. I’ve also run into this potential ambiguity in internal talks with @SCBuergel. When I talk about providing liquidity, I generally mean the total on BOTH sides of the pair. Is that how most people interpret it, or am I in the minority?
First of all, excuse me that I am not so familiar with the terminology in DeFi space, and I was guessing what “$500,000 in liquidity” would mean.My first understanding of this DAO proposal was to distribute ALL of the current liquidity in HOPR-DAI pool on Ethereum, and that lead me to the understanding $500,000 should be the size of one of the pair otherwise the number would be too small.
So, if I understand it correctly now, the size of the current HOPR-DAI pool is about 9.4m in liquidity and we are actually talking about a smaller portion of the liquidity (1.35m/9.4m) than I thought…
No worries. I’m not super familiar with it either, so I wanted to make sure I wasn’t being unclear. Yes, we have around 9m in liquidity to distribute, so the current proposals are for around 15% of that.
Given the market cap of HOPR is just shy of $10M with the maximum coin supply of 1,000,000,000 at $0.11 this equates to circa $11M. Are you looking to put the entire HOPR funds into one project? There is a saying in Crypto and investing “Don’t put all your eggs in one basket” and I hope I am misunderstanding or there is additional funding from the initial raise, but would need this clarified before voting.
So none of the DAO funds are currently available to the HOPR Association. Everything raised at launch was put into the Uni v2 liquidity pool (now migrated to Uni v3). None went to the team or project. So there aren’t really HOPR cash funds in scope in that context (HOPR Association has its own funding and supply of HOPR tokens in treasury).
The DAO liquidity is currently around $8-9m TVL, down from around 20m at launch. This is mostly due to impermanent loss (the initial $20m was also unrepresentative - our launch used a price finding mechanism which some people didn’t understand, so the price was artificially high for some weeks after launch)
By staking rewards I guess you mean the HOPR staking program? That’s funded by the Association from treasury, not from DAO.