Monday, March 27, 2023

Kujira BOW LP-efficacy: an analysis

My MARS/axlUSDC sell-order hit on @TeamKujira FIN, for the purpose of funding the MARS-axlUSDC LP on BOW.

But.

I said I was going to study the efficacy of the BOW LPs. Are they growing on trade volumes?

BTW, what defining-curve does this chart illustrate?


My study revealed the following.

I, as a liquidity provider, have seen 0 growth of the LPs.

Since day 1 that I've provided liquidity.

This is gravely concerning to me.

Not only are LPs not growing on trading volume, but, do you see the 3 red lines (OT)?

These denote three LPs that have simply vanished from BOW.

I've submitted a ticket, but this is the fourth ticket, for a total of 6 LPs, that I've submitted.

This is gravely concerning to me.

Not only this, but LPs comprise 20% of my Kujira-portfolio, 


and are the major drag on that portfolio, down, now 8%. 


This is atrocious performance for a component that's supposed to ACCUMULATE liquidity.

This is gravely concerning to me.

Given this direct observation that LP tokens DO NOT increase on order book-volume, the ONLY incentive for @TeamKujira BOW LPs are ... the incentives.*

Most of which have dried up.

*or if you're hedging A on a massive B deflation, but I'm not talking specific power-plays here.

Now, there's a reply to my concern on discord (thank you, Hans, from @TeamKujira).


But I do not see BOW LPs as a viable part of my Kujira-portfolio: they are far too buggy, 'disappearing' liquidity too often, requiring I SUBMIT TICKETS TO RECOVER FUNDS!??!?

THIS IS A REAL COST!

Furthermore, 'size of pool growth' benefits the liquidity provider, ... how?

I provide x tokens a month ago, I withdraw x tokens today, AMM-adjusted I see 0% APR.

For all BOW LPs.

Consequently, I'm withdrawing all liquidity from BOW.

I would

LOVE

to hear your success stories of investing in BOW LPs, with measurable proof of your successes.

I, however, have measures that show me that BOW LPs are not for me.


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