This is a recap of the internal AMA done by the dev team at Lixir. As a reminder : the Lixir LBP will start on 8th May @ 4pm UTC (details HERE)
Lixir, Lixir 2, and Ksirin — all founders — answered questions during the AMA
Q1 : liotcheg : Hi, guys. Why $LIX is required [to access] only for high-risk pools and how exactly you define high-risk?
A1 : Lixir : As you might know, there is the concept of an accredited investor, that either proofs due to his professional career that he knows what he is doing or he has the sufficient means (money) to invest.
More risky pools, can (don’t have to) mean a potential loss. In order to make the entry barrier slightly higher for investors and not just anyone aping in because of the high APY, we require a minimum entry for people to join this pool. This is our way of making sure we have some sort of accredited investors for more risky pools
A1 : Ksirin : high risk depends on the pair and how tight the spreads are — the tighter the spread the more swap fees are generated, but the more likely volatility will push it out of the range and also more likely there will be an autorebalance with a different median price, which means a portion of the tokens will need to be swapped, losing a percentage to fees
Q2 : Kierk : Will it be available for every trading pair on uni v3?
A2 : Lixir : No, we will start with 2–4 pairs and then the DAO(community) can vote on the next ones
A2 : Ksirin : the reason we can’t support all pools from the outset is the pools require a strategist like yearn vaults to do the rebalancing — this is a sensitive action and needs a permissioned account (controlled by governance) to protect from flashloans and sandwhich attacks.
It’s possible at some point to delegate this task to something like k3pr — we’d need to figure out a sensible mechanism by which the gas costs for the k3pr actions are subsidized. I’d also feel more comfortable using k3pr if they used flashbots’ mev protocol as assurance against sandwhiching
Q3 : liotcheg : Will you please describe an imaginable action-flow of a user who will use LIXIR? Is it deposit and forget or some fine-tuning will be possible/required?
A3 : Ksirin : Yeah, you can either add tokens in a proportional amount, or you can just add one, which will cost some fee as a portion needs to be sold into the pool. Adding a single token is similar to single sided add with balancer pools, or zapper’s functionality which swaps a proportion to add in — hence the fee.
Q4 : franco_phil : Will we see public github repo’s before the LBP?
A4 : Lixir : 100%
Q5 : franco_phil : How do you see value accrue to the LIX token? You mentioned it could be used for access to higher-risk pools and I’m assuming it has governance features, but will there be a direct fee-accrual mechanism? (platform fees to token holders, buy-back mechanism, etc…)
A5 : Lixir : We actually are finalizing the exact details, but we “could” see a performance fee to token holder who stake them. But that’s likely a feature vor Lixir V2
Q6 : Kierk : Whats the goal of v1 of the project, if you dont have a tokenomics idea?
A6 : Lixir : Tokenomics are pretty much defined and obvious to everyone in the community who followed the articles and our discussion. V1 will be ready to use liquidity concentration manager that you can use for the supported pairs on our platform.
In easy terms: You deposit with Lixir your liquidity, we manage it, you receive fees and on top you farm LIX. V2 is yet to defined, but we see a scenario where you can stale your LIX to get part of the performance fees!
Q7 : Kierk : How is this project different from NFT vaults as Visr and Mthd? This can be seen as a Defi Saver project? Protecting your position?
A7 : Ksirin : different because visor and method use NFT vaults, whereas our pool tokens will be erc20, giving UX similar to uniswap v2 but with v3 concentrated liquidity. so it’s also possible for other projects to bootstrap liquidity using our pool tokens and the usual lp farming contracts
Q7.1 : liotcheg : How can it be ERC20 if V3 will work only with NFT vaults to store LP parameters?
A7.1 : Ksirin : well, uniswap v3 actually builds the NFT vaults on top of the pool mechanism, it doesn’t assume NFT’s. it is true that the positions are nonfungible — but our rebalancing strategy allows fungibility of pool tokens because everyone with a lixir LP token has a share in the continually rebalancing provision of liquidity to uniswap v3.
So uniswap v3 doesn’t build any assumptions in terms of how positions in uniswap v3 positions are managed.. an address adds liquidity to a position which is described by a lower tick and upper tick — each tick represents a change in 1 basis point of the price of the two tokens in the pool relative to each other. this position is nontransferable. uniswap v3 ships with another contract built on top that is an NFT wrapper over these positions and liquidity may be added or removed by the NFT holder. in contrast, lixir pools interface with the uniswap-v3 pool contracts directly, like their NFT wrapper does. in lixir v1, the pool will maintain a single position which is rebalanced over time, and so the erc20 token of a lixir pool represents a proportional share of said position
Q8 : Contemps : We can vote which pair we can put in the LP, after that. If we have enough LIX we can put a specific amount of the voted pair? And then your protocol will balance the liquidity of this pool and while it’s balancing it takes fees from those who are trading this pair? And the fees will be transformed to LIX which will be given to those who provide this pair? Do I understand it correct
A8 : Lixir : So let’s take a step back here. After we launch the first version, we will support 2–4 pairs. From there the community can decide to put up a proposal for another pair, and everyone who has LIX, can take part in this vote. The majority decides if a new pair is added or not
Q9 : magicturtle : im trying to understand if you guys have strategy creators/have ran backtesting on your strategies you’ve made so far.
A9 : Ksirin : for V1 we will be simply using a time-weighted average price with a spread around it. however, we are investigating methods used in legacy finance market making to determine the spread with more data points, factoring in things like volatility. we have some mathematicians that will improve and refine our strategies for rebalancing which can be voted in by governance
Q10 : Kierk : Is your tech live at v3 launch or are there things to be worked on yet?
A10 : Lixir : gonna be close, working on a lot as we speak. the timeline from when v3 was announced has been really tight, so don’t want to just throw dumb shit up to hit the exact launch day. Contingent on audits and whatnot, but we’re in really good shape to be very close
Q11 : Chunt : about the upcoming LBP, the ending weights (71.50 : 28:50) differs from most lbp I’ve seen. How will this play out on price curve during the event?
A11 : Lixir : We start with 25$ and end up with 1$ if no one buys. That being said the slowest decline is somewhere around 6–3$
Q12 : Kierk : Is there a marketing campaign in the works?
A12 : Lixir :yes ser, we also will host an airdrop contest for our community so that you guys can also participate
To conclude, Lixir reminded us that :
Next things to expect are a detailed whitepaper that goes into the details of how we rebalance and our first contract releases
Resources : 📚
-Announcements Channel: https://t.me/lixir_announcements