Hello Forthers, Amplers, and Spotters–
The current round of Geysers are set to expire in 32 days, on ~Jan 21st. Now that SPOT is released into the wild, I think it’s a good time to revisit some high level strategy questions on how we should approach or optimize the geyser configurations.
As a refresher, there are currently four programs running:
Geyser | Platform | Pair | Chain | |
---|---|---|---|---|
Splendid | Aave | aAMPL | Ethereum | |
Trinity v3 | Balancer v2 | WAMPL/WETH/WBTC | Ethereum | |
Beehive v4 | Uniswap v2 | ETH/AMPL | Ethereum | |
Crystal | Pangolin | WAVAX/AMPL | Avalanche |
Before proposing specific numbers for the next round, I wanted to run some thoughts for feedback first. I think right now, a primary goal of our ecosystem is the answer to the question “How can we most efficiently support the success of SPOT?” To that end, I propose halting the Splendid, Trinity, and Crystal, extending Beehive, and adding one new geyser for SPOT.
This would leave us with two, deeper geysers.
Splendid
Given the unfortunate news of Aave turning down many of their markets on V2, the Splendid geyser no longer has the utility it used to.
Crystal
If there’s one learning from the last year, it’s that multichain bridges are a continuing liability. I don’t think the space has played out in such a way that cross-chain systems are driving the market. Also, the technical landscape has changed such that other technologies like Ethereum Layer 2 are become much more promising. But they’re still very early in development and it’s hard to say which L2s will be important (Optimistic Rollups, ZK, etc).
So I think it’s premature to invest too much now, until it’s clear which platforms get traction. In the interest of avoiding the fracturing of liquidity, I propose halting the Crystal geyser on Avalanche and instead doubling down on liquidity on ETH L1.
Trinity
The ETH/BTC/AMPL pool on Balancer was originally conceived to be an interesting basket of collateral / Store of Value index. At the time (and still today) AMPL has the same Store of Value qualities that Bitcoin does–non-dillutive, “hard” money. However, now that Spot is live, there’s an even better Store of Value available. I don’t think Trinity has the same draw that it might have when it was established, especially with the difficulties borrowing platforms have had using LP tokens as collateral.
Beehive
I think we should resist liquidity fracturing and instead encourage very deep liquidity into a small number of pools instead. AMPL/ETH on Uniswap V2 seems like the best candidate right now. Let’s keep this one, and move any AMPL that would have been in other geysers here.
SPOT
Given how important I see liquidity being for the success of SPOT, I think we should experiment with a SPOT/USDC geyser. We’ll need to balance the extra demand with the healthy growth / supply caps of the system. So this first version we should view as a small pilot that has the option of growing in the future.
This would be built on top of a managed Arrakis vault that that can be tokenized and used in the geyser system.
Long Term
Long term, I think we should strive to move towards a system of DAO-owned, permanent liquidity. The DAO already owns a sizeable portion of the AMPL liquidity on Uniswap, for example. SPOT liquidity has a bright future for providing the “real yield” that most DeFiers are looking for right now, so it could organically grow very large.
What do people think of this overall approach?