Sov/rbtc LP bounty ended today.
TL;DR: Looks like most LP’s are gonna breakeven their rewards with their impermanent loss, so would be good to know how much we made from fees.
Also, button to withdraw Sov/rbtc LP is greyed out at the moment.
Requesting some clarity on these matters to avoid FUD.
Before the trading launch, I asked @yago about the risk of impermanent loss, and he said if IL would outweigh the rewards, the exchequer committee would step in to compensate liquidity providers.
This might be relevant.
Myself, I deployed my LP @ 35,000rbtc per sov. Since then price has done 366% increase, resulting in 23.72% loss according to my amateur calcs, or a loss of 149.8 SOV if I understand correctly.
Meanwhile, my rewards are gonna be right around 145-150 SOV + fees.
So it looks like it will go out at breakeven, except the reward SOV is vested over 10 months whereas LP sov was freed, but now… well, lost if withdraw LP.
For people that started LP on the second week (starting april 20th) I assume a price of 75,000 sats (range of that day: 63k-88k) which gives an IL of 11.4%. For these people, my amateur calculations say that the rewards outweigh impermanent loss by 10%. So 10% gain + fees, but in 10 month vested tokens.
I made the amateur calculations here:
For myself, exchanging 150 SOV for 150 vested SOV… makes me really itch to know how much extra I have made from fees, to find out if the experience is sweet or bitter. I think others feel the same.
Would be good to have this on the table before we enable LP withdrawal.