The proposal to reduce the swap fee from 4.2% passed with the community’s preferred option being to adopt a dynamic fee model. However, the existing v1 pool is not able to utilize the dynamic fee strategy.
Motivation
In light of the recent iROBOT DAO launch and the plans to migrate to Balancer V2 after iROBOT DAO has executed, we propose that the swap fee be reduced to 0.69%, the second most preferred option here.
This will allow iROBOT DAO and wider contributors to access ROBOT liquidity in a more effective manner during the interim between now and the migration to a Balancer V2 pool.
Specification
If this vote is successful, the MF Multisig will adjust the swap fee from 4.2% to 0.69% on the existing ROBOT/WETH liquidity pool until iROBOT has finished and a v2 migration occours.
This has less to do with fees but iROBOT in general.
why shouldn’t GEAR LPs pull their liquidity to prevent IL and make ROBOT price pump harder from iROBOT purchases?
If there is less liquidity in the pool, ROBOT price will go up higher from this mandated buyback program. The iROBOT DAO is locked in so they are forced to purchase ROBOT no matter what. If no on sells then iROBOT has no choice but to run up the price and why would anyone sell when they know there is $3m of ETH waiting to buy ROBOT?
Profit from trading fees is nothing compared to price appreciation from iROBOT purchases, especially if GEAR LPs force a pump. Having high fees makes staying in the pool tolerable during this time period but cutting them by 85% makes the only sane option to pull all your liquidity.
Pulling GEAR liquidity is profitable move on an individual level AND ALSO at MetaFactory DAO level
Our treasury is majority ROBOT (especially since we just sent 69 ETH to iROBOT) which means the higher the ROBOT price, the more valuable we are worth. The higher the price goes the more attention from the market and media we get which brings in more artists and sales. The only people that are disadvantaged from this is iROBOT members (excluding MF DAO) which are the people this plan is supposed to benefit lol. Even if they spread their purchases out over 6 months they’d be increasing daily buy pressure by 50-100% over current levels.
So regardless if fees are changed or not all GEAR LPs should pull their liquidity for the good of MetaFactory (and themselves).
If iROBOT doesn’t want to pay dex fees why don’t they (we) just do a treasury fee. For an “independent” DAO we seem to be changing a lot of our DAO parameters to accommodate them (us)? This whole thing seems overly complicated. I still don’t understand why individual people can’t buy off a dex without a DAO, its really not that difficult there is nothing to “coordinate”.
Either they want to be part of the community and should buy anyway because they see value in us or they want a financial investment and they can enter the market at the appropriate price for them. Either way just letting them do what they want seems like best option. How much time/energy has core team wasted (imo wasted) on this instead of actual value adding activities? Is iROBOT a cool idea? yea. Do we have better things to do? definitely. Is it our responsibility that people can’t execute a purchase on their own? not at all.
Pulling out liquidity isn’t actually a risk? if price pumps a lot ROBOT holders can just sell everything droping the price, and low liquidity will make this unstable.
I don’t think this is a fair characterization. You can say ‘why don’t individuals just buy themselves without a DAO,’ but they haven’t / didn’t. It was only the efforts of the iROBOT team that raised over 1K ETH as an investment into MF AND done in a way that benefits the entire network vs. a treasury sale to a VC or private equity team (which is just a USD pass through).
Also, to be clear, MF team has spent very little time on this effort as it was coordinated by _ and DAOhaus teams.
If you’re concerned about IL and your current liquidity position, then reduce your exposure, but attacking the approach because of this concern without making an effort to understand the intent and value of this approach isn’t helpful.
Why would they sell if they know there is capital committed to buying already? Same reason we had to provide bonus ROBOT to iROBOT members so people didn’t frontrun.
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