RE: Welcome to my Hatchet-Job: Polycub Liquidity Pools & Sustainability Models
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I like posts like this, they should spark discussion.
First for the personal decisons. Everyone should be carefull not to overexpose them self to a new project that is experimenting and trying out new things. The project can fail no matter how well intenioned it is. Its just how things are when you try new things. If succeds ... then bingo. Everyone should looks at this as a type of fun/casino, trying out new stuff... the whales you mentioned that are locked, I know few of them and it is no bigie for them if it all goes to zero .... btw landing should help them out
About the project itself, the volatility and the stability you mentioned. You are saying we should opt for stable asset with yields. How do you propose we get there? To have a stable asset you need big initial liquidity and a small marlet cap, that will gorw slowly.You did well looking at the the liquidity vs the market cap. How can we seed a 1M liquidty at start for example, instead of 100k?
Even if it is a 1M, it still nothing and whales outised our domain can move it with ease. Looking for stablity in crypto is very chalenging. At the end of the day you cant learn without doing something. This is another itteration, and it has it pros and cons, a lot of new things added. Hope we all learn from it .... and yes it is still early to judge
I wrote a lot about this in the original post and linked to more info:
https://peakd.com/hive-167922/@edicted/more-on-why-decreased-inflation-equates-to-a-lower-token-price
Our entire concept of how inflation and deflation works is not correct.
Manipulating inflation creates a delayed reaction.
I have blogged about this many times.
If we jack inflation to the moon today, that jacks yield up to the moon, today.
That makes all investors want to buy more because the APR is absurd.
But APR is measured per year, so the actual dilution of that inflation doesn't not happen until a year from today.
So we can jack up inflation today and get investors today,
and not have to pay the price for it until a year down the road.
Taking yield away makes farmers not want to be there, immediately.
Again, we don't get the benefit of reduced supply for quite some time later.
Big investors and whales will know the price targets,
and we can even set up automated systems to accommodate the price manipulations.
The only real problem, is supply shock (which nobody actually believes is a problem because everyone wants number to go up). So price goes up, the network moves to decrease inflation, but price goes up again, so the network decreases inflation more aggressively, and price goes up again. This is clearly a supply-shock situation, and lowering yield will no longer lower the price, and we can even consider it a money attack on the network and too much money is coming in for the network to handle.
In this edge case the network has to go back into price discovery, which I now realize that I haven't even explained. In price discovery we let the network pump and dump on purpose with all yield being allocated to one or two farms, and that's it. That is the only way to truly gauge the price and stop inflation from bleeding out of the system.
To recap:
TLDR:
It's absurd to think that we can statically manipulate yield and emission/inflation/interest rates and think that's somehow going to work in our favor. We have the tools to be better than a central bank by exponential margins and legit everyone in DEFI is fucking this up. It's embarrassing. Like... imagine everyone talking about how incompetent the Federal Reserve is, and then having the Federal Reserve come over here and watch how we are doing it. It's laughable. We would get laughed at.
We clearly need to be dynamically adjusting to the situation at hand and cutting out all the bullshit that has negative estimated value. Allocating yield to a BTC/ETH pool is a negative EV play waste of money. Every time. How does that serve us? It's a one trick pony.
The first DEFI coins got away with it because DEFI was new and they were the only game in town and they wanted to get the attention of big money. That shit isn't going to work anymore there are a million DEFI coins and no one gives a shit if we allocate yield to BTC/ETH other than the bots that join in while it's profitable and dump on us and the legitimate LEO whales who use it as a risk-free strategy to premine the token. Like, no. Veto that shit immediately.
Obviously this comment is now like a post long so just trust that I'll be talking a lot more about this.
Ok so few things are clear and I can agree with them
So we need a presale .... unknow how this will go and how much will be sold/seeded ... also till now everyone was getting the token for free, not sure how will they react when you ask them to pay :) Lets say it achives some moderate levels ... be awere this will create another problem, those who entered the presale will like to dump fast
For the high yield in the xPC I agree, imagen 50% penalty went to pcub/usdc, pumping liquidity.
For the two above we already have experiance and its tested and can confirm with higher level of certinty (not a 100% :))
Now for the rest ... changing yield dinamicly from xPC to PC farms and hoping this will result in more price stability is a big question mark. Cub increased the single pool apr recently and the effect was negligigble. It can be tested but I imagen a drastic moves in yields will be need for it to have affect. Lile from 0 to 100% and the oposite.
I read the post and the conversation between you to feel smart...didn't work.
Maybe by this time next year I can fully grasp your articles
The effect wasn't negligible at all.
It actually crashed the price even more than it would have otherwise.
You are trying to isolate one variable when three different things happened.
The biggest variable here is the pCUB launch.
It was obvious that people were going to sell CUB and LEO to participate in the project that had 10000% yields. It did not matter that APR to single staking was increased from 30% to 60% because it's competing with 10000%. In fact it should have been decreased and the LPs increased to add liquidity to the system because we knew there was going to be high volume.
Better yet, don't start the new network with 10000% APR and waste a bunch of money for no reason, pulling in liquidity from CUB and LEO and then bleeding that value out to bots & kingdom whales. This is not rocket science. If you want a sustainable token then make a sustainable token. Opening with 10000% is known to be unsustainable. Stop giving an advantage to people that join within the first five minutes. Stop saying, "Oh don't worry we will make this sustainable later." No, make it sustainable now.
im looking forward to your DEfi launch edicted. Mad scientists like you should all be having a crack at this problem....every time a new experiment is launched, something new is learned. Its just a shame that everyone feels the need to shill their projects as if they were golden unicorns when clearly no-one really knows how this stuff is going to play out. A lot of starry eyed minnows have their savings at stake! We should be protecting them with clear warnings and grounded expectations. This is like taking an experimental vaccine....
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lol. I am the top one...
Neurotic, emotional, doomed to flounder
It actually super reminds me of the wLEO hack because I was like oh shit that sucks for khal and I didn't try to message him for like 3 days lol