Quickswap Liquidity Mining on Polygon.
I have been speaking with the Quickswap team. Quickswap is a dex on Polygon. They are a fork of Uniswap. They would like us to provide a total of $500,000 of seed money for a liquidity pool on Quickswap with the POOL/QUICK pair. They are offering 2 QUICK/day in exchange for this amount for an initial period of 2 weeks. The current price of QUICK is $275.
$500,000 deposit into POOL/QUICK pool.
2 QUICK/day = $550/day
$550/day * 365 days = $200,750
$200,750/$500,000 = 40% APY
After the initial 2 weeks the QUICK/day emitted for the POOL/QUICK pair would adjust to an amount proportional to our trading volume on Quickswap. Currently Quickswap is distributing 726 QUICK/day. So for example if POOL/QUICK volume is 1% of total trading volume on Quickswap then we get 1% of the total daily emissions (726). That would be 7.26 QUICK/day if the POOL/QUICK pair made up 1% of trading volume on Quickswap. Total daily emissions are stated to fluctuate between 700-800 QUICK/day for the next three years.
In addition, to encourage further migration to the Polygon ecosystem, the team from Quickswap is proposing that we initiate a POOL drip to the USDT PoolTogether pool. I support this. This would allow us to grow our presence on Polygon, and with the liquidity available on Quickswap via this proposal we can create a market for POOL on Polygon. Also, this provides PoolTogether users on Polygon a place to earn yield on their POOL tokens. A yield source for the POOL token on Polygon would reduce sell pressure on the token by providing a place to park POOL. There are not many places to earn yield on the POOL token so this makes sense to me. Also with gas fees so low people can get in and out of liquidity providing with basically any amount. I think this will attract current users on Ethereum, and new users who are currently on Polygon, but not in PoolTogether. These users would receive WMATIC and POOL rewards. It would make us very attractive in the Defi landscape. Perhaps 50 POOL/day would be an appropriate amount. Feedback welcomed here.
Since governance does not control any assets on Polygon we would have to grant control of the funds to a multisig which can execute the appropriate transactions. I would propose two members of PT Inc and three community members for a 3 / 5 Gnosis Safe Multisig.
Those transactions would include the following:
Send POOL from treasury to multisig.
Swap the appropriate amount of POOL for QUICK
Bridge both assets to Polygon
Create a token faucet on Polygon for the POOL drip.
Fill the token faucet with POOL
Deposit POOL/QUICK on Quickswap
Stake POOL/QUICK LP token on Quickswap
Claim QUICK rewards
PoolTogether expands presence on polygon.
PoolTogether treasury earns liquidity mining rewards.
A new yield source is created for POOL
Increase revenue through USDT reserve rate.
Impermanent loss with treasury funds
Smart Contract risk
I think this proposal is the best current option we have to expand our presence on Polygon. I think the benefits greatly outweigh the risks. I welcome all feedback on this.