[Proposal] Liquidity Pool Handling 2.0

OceanDAO Round 2
#1
  • Name of project: Liquidity Pool Handling 2.0
  • Team Website (if applicable): -
  • Proposal Wallet Address: ty(*mandatory; must have minimum 2000 OCEAN already in wallet to be eligible. This wallet is where you will receive the grant amount if selected).
  • The proposal in one sentence: Creating a DAPP to extend the handling of liquidity pools on Ocean Protocol.
  • Which category best describes your project? Pick one or more.
    • [x] Build / improve applications or integrations to Ocean
    • [ ] Outreach / community (grants don’t need to be technical in nature)
    • [ ] Unleash data
    • [ ] Build / improve core Ocean software

Project Overview

  • Description of the project:

The idea is to create a suite of functions in a DAPP that can achieve the following:

  • Dissolve a liquidity pool and send back fair shares to the people that are in it by assessing the amount of tokens/liquidity pool shares that the participants own and then splitting up the Ocean in the pool accordingly and sending them to them. This will cost the dissolver ETH and possibly some of their own tokens.
  • Rebalance a liquidity pool by minting new tokens and sending them to the liquidity pool as well as the token holders. This will also cost the invoker ETH to do the transactions. But this could then be used by e.g. the Swash pool or old pools to fix their token : Ocean ratio.
  • Airdropping an amount tokens of a new pool to pool and token holders of a new pool. This is helpful to reward participants/contributors in a dataset when an algorithm is created out of that data.

These functions will be extensively tested on Rinkeby to make sure they work.

  • What problem is your project solving?
    Extending the options liquidity pool providers have while also creating mechanisms that benefit the whole ecosystem.

  • What is the final product (e.g. App, URL, Medium, etc)?
    Open source project on GitHub as a repository.

  • How does this project drive value to the Ocean ecosystem? This is best expressed as Expected ROI, details here.
    These features will enable pool creators to end their pools. This feature alone is extremely valuable. If you look at the unrest that was created by rug pulls or the end of the Atlantis project. This just makes the whole process smoother.

  • Token holders currently: 24,476
  • Token holders that might sell their tokens because of rug pulls in the future: 1%
  • Avg. holding per holder: 30K Ocean (613 Mio / 20K holders)
  • Sell off of Oceans = 24,476 * 1% * 30K = 7.34 Mio Ocean
  • Expected impact of extra 7.34 Mio sell off for Ocean on USD price : -10% (for reference, a sell of 300K USD would induce +50% slippage on Uniswap)
  • Expected impact on Ocean network total value: -15.3 Mio USD (10% on 153 Mio USD)
  • Likelihood of sucess: 80%
  • Bang = 80% * 15.3 Mio = 12.2 Mio USD - here the sign of the value does not matter, not having a loss is also a win
  • Bucks = 10K Ocean = 0.0037 Mio USD
  • ROI = 12.2 / 0.0037 = 3’297
  • Note that the long term community impact will be much bigger, and it was not included in this ROI calcluation.

Project Deliverables - Category

IF: Build / improve applications or integration to Ocean, then:

Project Deliverables - Roadmap

  • Any prior work completed thus far? No
  • What is the project roadmap? That is: what are key milestones, and the target date for each milestone.
  • Dissolving a pool -> end of March 2021
  • Rebalancing a pool -> end of February 2021
  • Airdropping to a pool -> end of April 2021
  • Please include the milestone: publish an article/tutorial explaining your project as part of the grant (eg medium, etc).
  • Please include the team’s future plans and intentions.
    • Any maintenance? No
    • Foreseen or possible additions? More functions if there is interest by the community

Project Details

If the project includes software:

  • Are there any mockups or designs to date?
  • An overview of the technology stack?
    TypeScript + React.JS + Ocean.js

Team members

For each team member, give their name, role and background such as the following.

Robin Lehmann

  • Role: developer

Additional Information

Any additional information, custom fields, or images you would like to add? For example: Any grants or fundraising to date?

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DataX : Build Unstake + Manage Stakes features + StakeX Docs
DataX : Build Unstake + Manage Stakes features + StakeX Docs
#2

Seems my ROI calcs were not so bad after all :wink: :joy:

This infrastructure project makes a lot of sense for many datatoken/pool creators !!

1 Like
#3

It will be open source so it can also be used for more scripts.

A use case that might also be interesting is that people might want to transfer a liquidity pool from one wallet to another which has to be managed with the creating smart contract.

Another one would be to be able to merge several liquidity pools into one. Or merge multiple liquidity pools into a new one.

But I am certain that this proposal will create sufficient meta functions and code that new use cases can be implemented with much less effort.

#4

What’s the status of this?

#5

This proposal is a tough one - the assumptions that I had were shared by other people, here I discuss it partially with Trent:


Unfortunately after further discussions with Manan and Alex C. it is not so easily possible to move an Ocean pool created on the Ocean marketplace to another blockchain or dissolve it at all. I will not disclose the technical details here due to the potential for abuse but it just simply is not so easy.
So the next step is to find a social solution for this and I have been in talks with some members of the community and the team and working towards a solution that will still work.
Regarding the other goals, the second one is not this easily possible because the ratio of a Balancer pool cannot be changed retroactively. To just dilute the pool a solution can be found here:
https://github.com/cryptaldev/price-your-pool / https://priceyourpool.xyz/

The solution to airdrop tokens was delivered as part of the Votes-4-LPs proposal as the resulting strategy can easily map out all the participants in an Ocean marketplace data pool.

#6

[Deliverables checklist]
[ ] Dissolve a liquidity pool and send back fair shares to the people that are in it by assessing the amount of tokens/liquidity pool shares that the participants own and then splitting up the Ocean in the pool accordingly and sending them to them. This will cost the dissolver ETH and possibly some of their own tokens.

This is impossible as dissolving a liquidity pool is impossible in the current configuration of the liquidity pools. The marketplace sets max tokens to minted tokens so minting more tokens is impossible. The assumption that was made for this is not possible - Trent also did not know about this as stated in the above YouTube video.

[ ] Rebalance a liquidity pool by minting new tokens and sending them to the liquidity pool as well as the token holders. This will also cost the invoker ETH to do the transactions. But this could then be used by e.g. the Swash pool or old pools to fix their token : Ocean ratio.

Minting new tokens is impossible for pools created on the Ocean marketplace, therefore this cannot be done.

[ ] Airdropping an amount tokens of a new pool to pool and token holders of a new pool. This is helpful to reward participants/contributors in a dataset when an algorithm is created out of that data.

I will refund 100% of this proposal as I was not able to complete it successfully.