The Uniswap v3 position has been a success, not only has it increased the depth of the liquidity, it’s brought in a lot of protocol revenue. I propose to boost this liquidity to get orders of up to $100k within a 2% depth.
Now that the incentives for the sushiswap pool have stopped there has been a huge drop in token liquidity. The below chart shows the pool liquidity over time.
We need to boost liquidity.
Previously we had paid for this through liquidity mining incentives to the tune of 200 - 500k ARCX per month. This is an expensive way to effectively “rent” liquidity.
In previous discussions thanks to the hard work of @monadnoc we created the Uniswap v3 position.
Since the inception of the position (3rd August), the project has now earned almost $100k worth of fees in both ETH and ARCX.
The below image indicates the uptick in uniswap volumes as the team found a stable range for the pool and the sushiswap incentives stopped.
In terms of volume, the Uniswap pool has had slightly less of the market share:
With less than half of the sushiswap liquidity (at it’s peak) this is no mean feat and gives an indication of the capital efficiency obtained through the use of Uniswap v3.
I propose we increase the Uniswap v3 position and effectively own the majority of the liquidity for the ARCX token.
Having spoke with the Llama team and utilising their expertise; the range we suggest at current prices to allow orders of $100k a 2% depth is from 0.00025 to 0.00082 ETH/ARCX. This would require the addition of 7.5 million ARCX and $500k USDC from the treasury to buy ETH.
We want to act quickly on this as the current liquidity pool is simply not deep enough. For this reason I will put this immediately on snapshot with a 22 hour window.