IDO Recap — Liquidity Bootstrapping for pool BSWT-SUI — POL
[TLDR;] More than 386,000 SUI were raised (equivalent to $416,880 USD). POL is a technique to buy BSWT at a lower cost in order to improve stability and long-term liquidity. The issue and solution of Mercenary Liquidity Providers
IDO Recap
BaySwap is the first protocol on Sui to use the Price Discovery approach. Allowing the community to pick the BSWT pricing is a challenge for us in our effort to deliver the greatest fair and innovative alternative for fundraising. In classic IDO, whitelist/og can acquire protocol token at a lower price than the listing price, creating hype and hype for the community that always wants to go first and immediately dump prices at token listing. The price of BSWT is fair for everyone in the Price Discovery Method, and the token is fully unlocked at the TGE, which is the goal of the BaySwap team when developing the BaySwap protocol.
BaySwap IDO stats:
- > 386,000 SUI raised (worth ~410,880 USD). Final price: 1 BSWT = 0.0193 SUI
- 14544 buy transactions. Average 26,5 SUI / transaction.
- Biggest buy: 6079 SUI
We can tell from the IDO results that whales who can join forces for price manipulation do not exist. This is a nice result in terms of BSWT token distribution fairness. As a result, we require an efficient approach to commence liquidity for the pool BSWT-SUI.
CEX Listing:
A CEX listing is an excellent way to attract new investors from their enormous user base. However, listing on CEX has a cost, which ranges from $50,000 to $100,000. We cannot disagree that being listed on CEX right away is a fantastic start for the price increase, but it also limits future price increases. BaySwap’s aim is to produce good-ready items on the mainnet first, then send them to CEX to unleash their full price potential.
Expected CEX listing: End of Q2 2023.
Commitment
Although the BaySwap Core Team token represents 10% of total supply (cliff 6 months, fully unlocked in 48 months), we are going to stake all of them rather than selling after unlocking, which has negative impacts on the protocol and causes community distrust. All data is recorded on-chain so users can verify it themself. As always, we are upfront about everything about BaySwap products from the start. Fair, honest, and transparent are keys to a community project.
Liquidity Bootstrapping — POL
Rented Liquidity
Ensuring liquidity is a serious challenge faced by any cryptocurrency. Without sufficient liquidity in the market, it is functionally impossible to buy or sell a token at a stable price, as any large transaction will cause a fluctuation. Issuers must incentivize liquidity in order to launch a new token. Many projects use liquidity pools and staking rewards to accomplish this, but it is costly. It also has the unintended consequence of attracting cynical investors, who farm the liquidity pool, collect incentives, and then abandon the initiative. This is referred to as “rented liquidity.”
OlympusDAO — 99% POL:
Instead of renting liquidity, as yield farming did initially, Olympus DAO introduces bonds to DeFi. By transferring their LP tokens or other cryptocurrency assets to the protocol, users can purchase discounted $OHM tokens.
This means that the Olympus DEX liquidity is now owned by the protocol rather than the liquidity providers. In fact, OlympusDAO currently owned 99% of OHM liquidity. OlympusDAO also rewards stakers with compounding interest, which makes staking more profitable over time.
BaySwap approach:
Our tokenomics allocate 1% of total supply to the Liquidity Bootstrapping Event. As a result of the Price Discovery Method in the BaySwap IDO, we observe that consumers are confused about how it works (described in the IDO announcement). In this case, switching to the OlympusDAO liquidity bond strategy is a good fit.
Follow Olympus DAO liquidity bonds— in other words, you can buy BSWT by SUI at a discounted price than market price with a locking period.
An example of a possible liquidity bond (notice that it is subject to change depending on market conditions).
- Base price (IDO end price): 0.0193 SUI
- BSWT Liquidity Bond Price = 0.0193 * 80% = 0.01544 SUI with a vesting period of 10 days.
- Limit BSWT for liquidity bonding: 10,000,000 BSWT (1% taken from DAO treasury, replace LBE).
- Start date: TBA.
Goal: BaySwap protocol owns liquidity of pool BSWT-SUI using the liquidity bonds technique. It aids in increasing the liquidity of this pool, significantly increasing liquidity, and resolving the problem of mercenary liquidity suppliers. It should be noted that the BaySwap team does not have access to POL; it is under DAO management.
Buyback and Burning Mechanism: According to POL, the BaySwap protocol generates cash from swap fees. Lending/borrowing functionality, as well as another revenue source from POL lending, will be added in the Q3 roadmap. The POL fees will be used to purchase and burn BSWT via DAO proposal and voting.
Clear picture: Users will get a clear view of how much BSWT they will receive after the liquidity bond using this easy way rather than LBE. This shift is crucial, especially in a bear market.
BaySwap is the ultimate trading platform — as known as a Decentralized Exchange built on Sui Blockchain.
We provide the best solution for traders, with many features supported:
- Efficient transaction fee
- Against high slippage
- Fast, secure, and friendly UX/UI
About BaySwap: https://linktr.ee/bayswap
