Swapr Mainnet Deposit

Swapr is approaching $5m TVL across mainnet ($1.2m) and xDai ($3.4m). Most of the focus has been on building out liquidity on xDai with 3 different proposals to deposit liquidity passed over the last month. DXdao is provisioning liquidity across 4 pairs with plans for a fifth.

On mainnet, DXdao is only providing liquidity on ETH-Dai ($1m). Last month, the community opted to focus liquidity deposits on xDai over mainnet, but I think we should consider additional mainnet liquidity deposits, in light of Swapr Beta launch and the installation of the new multicall scheme, which will allow DXdao to connect Swapr through the liquidity relayer.

While mainnet is competitive, it’s also where all the liquidity and users are. DXdao’s $1m in the Dai-ETH pool on mainnet sees about the same volume a day than the $1m on xDai despite the gas costs. Additionally, there is a level of seriousness that comes with a mainnet TVL and think additional funds would truly make Swapr “multi-chain” and may prove helpful for Arbitrum bridging.

I think we can be more focused on mainnet. I was thinking about a 400 ETH deposit, split 75% in ETH-Dai and 25% in Dai-USDC. This would make the Dai pool more attractive and ensure users have an easier on-ramp. These pairs will likely attract arbitrage bots to keep Swapr pools in line with market prices.

What do others think? Should DXdao deposit additional liquidity into Swapr mainnet?


DXD/ETH immediately comes to mind.
I guess the problem is that DXD is still very undervalued?

We can calculate how much unprofitable this would be.

The buyback will buy DXD up to about 1DXD = 0.35/0.4 ETH (precise value varies because we also have stablecoins in the treasury). This means about 4x from current price.

We can calculate the impermanent loss of doing LP in the DXD/ETH in the event that DXD grows 4x vs ETH. The impermanent loss is of 20%.

This is not negligible but, I’d argue, not a game-stopper

I think DXdao/SWAPR would benefit from having its DXD token have some liquidity.