We have our own incentive staking contracts that can be deployed on any Moonbeam compatible AMM. We currently run a variety of incentive programs for different blockchains and protocols.
Excuse my ignorance, but how is position management incentive?
We offer an incentive platform for managed concentrated liquidity pools.
If those positions are already being incentivized by the Stellaswap or beamswap grant program, wouldn’t it be rewarding twice, for the same work?
We are working with any AMMs on Moonbeam so long as we are compatible with their tech. Uniswap will be moving soon, and we can also support Moonbeam project tokens and partners. We have LSD pairs that we can manage on behalf of Ankr and other liquid staking partners. We also bring our user base into the Moonbeam ecosystem and offer customized analytics via our frontend, which is not offered elsewhere.
Can we have a further breakdown, how will the incentives be delivered? how many vaults, how many tokens will be delivered in how much time, as well as the expected apr from them
and the breakdown of the 400k GLMR, for development?
If the incentives are not fully spent, in the established time, what is expected to be done with them?
I still don’t quite understand how to do it with the incentivized rewards from stellaswap and beamswap + gamma rewards for the same pairs, or you don’t see it as a problem, if is like that, can know why?
If they already offer incentives for X tokens, the best thing would be for gamma to incentivize different ones?
hey strategicreserve, Thank You for your proposal! It’s great to see that Gamma has started supporting the Moonbeam ecosystem! your contribution is greatly appreciated, and we look forward to the positive impact it will have!
Could you please explain what you mean by this?
I have some important questions that the community is likely to have. Thank You in advance for your answers and your time!
Could you please elaborate on the criteria and process for selecting the strategically important pools that you will bootstrap with liquidity incentives? how do you determine which pools require liquidity support and contribute to the growth of Moonbeam?
How does Gamma handle impermanent loss for liquidity providers within the vaults?
What fees or commissions does Gamma charge for its liquidity provision services through the managed vaults? are these fees fixed or variable, and how are they calculated?
How does Gamma ensure that the liquidity incentives provided through the managed vaults are distributed fairly among liquidity providers? Is there any mechanism in place to prevent concentration of incentives or favoritism towards certain members?
Can you highlight some of the specific advantages that Gamma offers to liquidity providers? how do these advantages contribute to a better user experience or improved outcomes for liquidity provision?
How does Gamma ensure the long-term sustainability of its services beyond the six-month period covered by the liquidity incentives? are there plans to generate revenue or establish a self-sustaining business model for the platform?
What security measures does Gamma have in place to protect the funds and assets of liquidity providers participating in the managed vaults? how do you ensure the safety and integrity of user funds?
Hi @jose.crypto I’m BP, a co-author on this proposal and can help answer some of your questions below:
We will be partnering with OpenBlock who is currently working with the Moonbeam Foundation to give recommendations regarding pair selection, length of rewards program, and how much to incentivize each pair.
OpenBlock is a blockchain consulting company who is currently helping Lido Finance with pair selection recommendations and amounts to reward. We are also working with OpenBlock Labs with the Uniswap Foundation in distributing their $ARB rewards. They are aiming to select pairs based off sustainability of the liquidity and value to the ecosystem.
They will provide to Gamma which pairs to incentivize with how many rewards, and we will implement that within our rewarder system where we can adjust reward rates and introduce new pairs for incentives relatively quickly.
Yes, to integrate on Moonbeam, it would require the following:
Frontend Development - 2 weeks 2 person - $25k USD
Analytics Development - 2 weeks 2 person - $25k USD
Based off the USD amount of GLMR, it would equate to approximately 400k GLMR.
I understand where you’re coming from, and it certainly would be a problem if there were duplicative pools being rewarded.
OpenBlock Labs will take into account pairs that are already being incentivized and will choose pairs and DEX’s that are currently being under-incentivized based off their analyses, which would be inclusive of pairs and DEX’s that Beamswap and Stellaswap are not yet incentivizing or under-incentivizing.
Hi there, I can help answer some of these questions:
As mentioned in my previous answer above, we are working with OpenBlock Labs who will be providing us with the pair selection recommendations and the reward rates per each pair. So they will provide the plan of distributions and we will provide the implementation of the rewards via our strategies for LP-ing.
Actively managing the positions such that the positions stay in fee-earning range help to offset a lot of that impermanent loss for the LPs.
Additionally, what many protocols and networks have found useful about our rewards distribution is that we can incentivize narrow and wide pairs with differing levels of rewards. Narrow pair LPs are often at risk of suffering greater IL and we compensate them with a higher reward rate to compensate. So it becomes a win-win in that the narrow LPs give better price impact on trades to the incentivizing network and the LPs receive greater rewards for doing so. We have currently implemented this on QuickSwap and Thena on Polygon and BSC respectively.
Currently, we’re charging around 14% on the swap fees for our liquidity positions, and auto-compound the rest into the LP positions. They are taken based off the fees that have accrued and it would be a fixed %.
The rewarder contracts that we use are a direct fork of MasterChefV2 of the Sushi contracts. They are fair in that calculate rewards per block based on the amount of liquidity provided. We are working with OpenBlock to determine how much to reward each position, but the most fair thing to do as mentioned earlier would be to reward the narrower positions more than the wide positions.
The main advantage is that we abstract away the need to actively manage LP positions. We’ll rebalance the positions prior to their going out of range, which helps with profitability of the LP positions. Next, we offer analytics on our LP positions where users can see the profitability of the LP position vs. holding the assets or 100% of one of the assets.
Prior to our managing liquidity on Optimism, most of the liquidity for WETH-OP was out of range. However, a week after we utilized our active management strategies, we increased in-range liquidity, lowered price impact, and attracted more volumes to the ecosystem.
That’s a good question and the main reason that we’re working with OpenBlock Labs who can provide the analytics and recommendations for pairs that will optimize for long-term sustainability of the liquidity incentives.
We have been thru 3 audits by ConsenSys Diligence, Arbitrary Execution, and Certik. All major issues have been mitigated and resolved. You can read the audit reports here. Audits - Gamma
We take safety pretty highly, and we’re constantly looking at how to improve security.
My main concern/question relates to providing grants to both the teams behind the concentrated liquidity AMMs (Beamswap, Uni and StellaSwap) and also Gamma on top of that.
I understand your concern. As noted before by bp, we are working with OpenBlock Labs to identify pairs in which incentives would help. As a concentrated liquidity manager, we have a degree of independence from Uniswap, StellaSwap, Beamswap, or any other AMM which deploys to Moonbeam. This grant would allow us to “fill the gaps” and ensure that more pairs were being correctly incentivized, and spread the liquidity properly to assure the best outcome for traders.
It shouldn’t affect our plans and strategy too much. As mentioned before OpenBlock, who is on retainer with the Moonbeam Foundation, will be the ones determining the best use case of the funds going forward. Mainly we just need to cover our development costs.
Yeah certainly we can work with longer incentivization periods as well. 9 months could be more appropriate. Our goal was to leave that a bit open-ended for discussion.
Most of that TVL is currently segregated across different networks and vaults. I think for the time-being it’s certainly been sufficient thus far. We can discuss internally what the right amount should be and whether we should increase that amount. But we have gotten a blue-chip audit from ConsenSys Diligence, which was an intensive 4-week, 2-person audit in addition to two other audits.
We’ve had significant partnerships with key players in those ecosystems like Thena (BSC) and QuickSwap (Polygon), both of which have big communities. We power their backend for liquidity management so large portion of their v3 liquidity is being managed by Gamma and we’ve integrated natively with their frontend as well. We also offer analytics that portray the performance of the vaults against holding the assets, which offers a lot of users more transparency into their positions.
Hey we reached out to OpenBlock Labs who will be providing the recommendations that we will be implementing. They’re currently working with Lido Finance on their incentivization structure. They will also be working with us in distributing $ARB rewards on behalf of Uniswap on Arbitrum, so they are quite experienced in this space.
I’d like to throw a few more questions at the Gamma team. I’m hoping to get some further insights and clarity on certain aspects of the proposal. It would be fantastic if you could share your thoughts with us.
Did you implement any liquidity incentive program for previous deployments on other chains? If so, could you please provide details about the impact and effectiveness of those programs?
Another liquidity management provider, Charm, has submitted a proposal too. Understanding the unique selling points and differentiating factors of Gamma will help in evaluating its potential contributions to the Moonbeam ecosystem. What would be the main advantages of your platform compared to Charm?
Could you elaborate on the use of the GAMMA token within your ecosystem?
Are you planning to leverage any specific Moonbeam technologies, such as precompiles, Cross-Chain Messaging (XCM), or any other Connected Contracts use cases?
Do you have any specific target values in mind in terms of Total Value Locked (TVL) or transaction volume? It would be helpful to add some key performance indicators (KPIs) or expected targets to each milestone to assist the Moonbeam community in assessing the growth and progress of Gamma’s liquidity management solution.
As the grant program progresses, what kind of reporting and updates can the Moonbeam community expect? How frequently do you plan to share the status of the grant and provide updates on the progress and results of the liquidity incentives program?
Ensuring user retention and attracting new users beyond the incentive period is crucial for the sustainability of the Moonbeam ecosystem. What strategies do you have in place to mitigate the potential loss of users once the incentives end? How do you plan to continue attracting new users without liquidity incentives? Additionally, who do you consider to be your target audience for your product?
Could you provide an overview of the steps involved in deploying Gamma on Moonbeam? Are there any technical considerations or challenges that you anticipate during this deployment process?
Please note that you have until July 14th, 11:59 PM UTC to make changes to your proposal. A list of changes based on community feedback should be added to the “Updates’’ section of the proposal and any changes should be reflected in the text of the proposal itself.
You can see what the liquidity distribution was like prior to and after our management of the liquidity.
Average volumes almost doubled and we increased in-range liquidity quite significantly, lowering price impact and attracting more volumes to the pool.
I would lay out the following advantages:
Flexibility - We are able to change strategies on the fly. Many times as liquidity programs progress, there is room for optimization in terms of the strategy. Perhaps if there is more volatilty than expected and there’s a need to go wider with the range or if there’s increasing competition for a trade route and we need to go narrrower with the range, we can accommodate for that without migrating the liquidity into a new vault. Our vaults are not hardcoded in terms of the rebalancing logic, which allows us to be flexible to new market conditions.
More integrations - We are integrated with multiple DEX’s and smart contracts. We have completed smart contract integrations with Uniswap v3, Beamswap, Algebra Finance (Algebra v1, Algebra v1.1, Algebra v1.9, and Algebra v1.9 (Camelot-modified). We are currently in production or close to it with all of these contracts, so we would be able to direct liquidity to a wider array of new DEX’s on Moonbeam as well as the typical Uniswap v3 pools.
Transparent analytics - WIth Gamma, the Moonbeam community will be given a public dashboard supplied by OpenBlock Labs which will showcase the analytics regarding sustainability of the liquidity incentives, illustrating the benefits to the Moonbeam ecosystem. Gamma will also provide LP analytics using our own proprietary analytics dashboard that will analyze performance specific to the LPs.
Experience & Strategies - We’ve been managing LP positions since 2021 and have experience working with a wide variety of pairs and strategies that include not only blue-chip assets but also long-tail assets, and pegged-price strategies for LSD asset pairs. We’re currently managing over 400 pairs across more than 5 networks and over 15 LSD pairs as well. Along the way, we’ve developed strong relationships with key liquidity partners such as Ankr, Radiant Capital, StaFi, Stader Labs, Rocket Pool, Uniswap Foundation, and Lido who have all trusted us to manage liquidity on their behalfs.
Sure, the GAMMA token is the governance token and dividend token that receives a portion of protocol revenues produced from our liquidity positions.
Yes, cross-chain messaging and cross-chain zaps is something that we’re certainly looking at to ease the ability for users to supply liquidity cross-chain with the minimal number of steps. We have a user base that spans across many chains including BSC, Polygon, Optimism, Arbitrum, and Ethereum, so taking advantage of cross chain messaging and connected contracts is something that we plan on leveraging to maximize the benefit not only to Moonbeam but for our own users as well.
Our main goal is to have a statistically significant, sustained lift in both TVL and volumes during and after the liquidity incentives program. For OP-USDC liquidity on Optimism, we saw TVL and volumes increase by 67% and 53% respectively during the peak of the liquidity programs and we see that the pool maintained its lift of TVL and volumes by 46% and 43% even after the liquidity program had finished.
Our KPI benchmarks would be to similarly create statistically significant lifts in TVL and volumes prior to the start of the liquidity programs for the pairs that we incentivize. Around 30 - 60% lifts in TVL and volumes post incentive programs would be a great benchmark to determine whether a liquidity program has been successful.
OpenBlock Labs will be our partner in providing an analytics dashboard into the performance of the liquidity incentive programs. It will be a public dashboard that would be updated dynamically to showcase how TVL and volumes are increasing as a result of our incentive program. On behalf of the LPs, Gamma will provide up to date, live analytics showing the performance of the LP positions against holding the two assets.
Yes, this certainly what our KPI metrics will be centered around which which is sustained lifts in TVL and volumes after the liquidity incentive program has ended. This involves choosing specific pairs and pools that need help with liquidity bootstrapping, after which will attract natural volumes to sustain liquidity. We’ll also look to target pools where there will be an existence of co-incentives from partners like Ankr, Rocket Pool, Lido, Stader and others who have a joint, vested interest in having liquidity for their pairs. Our strategies will also be constantly updated to provide the right amount of concentration to be sustainable. I think Charm had mentioned in one of their posts that that their pools performed better when not taking into account incentives; however, the existence of incentives should definitely be taken into account when determining how concentrated to go with the ranges.
The more incentives are available, you have the ability to go tighter with the ranges to offset the greater impermanent loss risk. The reason we go tighter when there are incentives involved is that it allows for a win-win situation to take place. The incentivizing network (Moonbeam in this case) would receive greater depth of liquidity per incentive spent, and the liquidity provider would be compensated for the tighter liquidity position. When incentives discontinue, we increase the width of the ranges which help minimize the impermanent loss risk to the LP given that they won’t have the additional incentives to offset their risk. By having the flexibility to account for different situations (w/ liquidity incentives & sans liquidity incentives) allows us to cater to the interests of both the incentivizing networks and the liquidity providers in a wide variety of situations which will help make liquidity more sustainable long-term. Having static strategies doesn’t allow for these optimizations.
Yes, absolutely. Our main infrastructure that we need would be the following:
1.) Subgraph support
2.) Gnosis Multisig API support
3.) Enterprise RPC solutions
The steps involved would be obtaining the list of pool addresses that our partner OpenBlock Labs suggests as the pools to incentivize.
Then we would deploy our smart contracts on top of these pool. We’d create a registry contract that stores the database of all our vault deployments. This registry contract will allow us to deploy our subgraph and create a database for all of our Moonbeam pairs.
From there, we’d launch these vaults on our frontend for public deposits. From our subgraph and database, we’d then formulate the analytics that will allow our LPs to evaluate their positions on our frontend.
We don’t anticipate too many technical challenges, but it would just take some bit of overhead to migrate all of our existing offerings (backend, frontend, analytics, and data) on other networks onto Moonbeam.
Hey, thanks for your response and questions. I’ll do my best to answer them here.
How did you guys identify Moonbeam as one of the options?
We started noticing increasing demand for our services on Moonbeam, and we’ve been dedicating some of our dev and marketing resources to the network.
We have been in talks with native DEXs on Moonbeam, such as Beamswap and Stellaswap, and have completed the backend integration for Beamswap. We’ve deployed our initial smart contracts for Stellaswap as well. There’s still more to do on the frontend & data side, which the development grant could certainly expedite in terms of bringing the full stack to fruition.
Our partnership with Algebra will also allow us to build for any project willing to use their AMM technology or Uniswap’s. We currently support a variety of projects currently building on Algebra/Uniswap, so we believe that we can have a widespread impact for many projects on Moonbeam who are building an AMM, looking for liquidity management, or using our technology for their use case.
Do you think double incentivization for DEX (StellaSwap and Beamswap) and it’s active liquidity managers is good with limited resources that Moonbeam has?
We don’t believe excessive incentivization is good for the Moonbeam ecosystem, and the existence of other incentives will certainly be taken into account when determining how much to incentivize a specific trade route on Moonbeam. Our goal with every integration is to increase the depth of liquidity per dollar of incentive spent, and if a trade route is receiving sufficient incentives and minimal price impact, that would be taken into consideration when deciding most likely not to continue incentives there.
Gamma chose to work with OpenBlock for this very reason. By taking into account the existence of rewards for a specific trade route as well as the demand from traders, among other factors, we can deepen liquidity on critical pairs that may not be getting sufficient incentives.
For example, when the Uniswap Foundation ran a liquidity mining program this last Spring, Gamma chose to incentivize pairs that they felt were important to the health of Optimism, instead of pairs that would bring in superficial TVL. Our program was successful because it led to sustained increases in both TVL and volumes after the liquidity program concluded.
Which LP pools do you plan to support and on what platforms, can you provide detailed timeline?
We’re currently working with OpenBlock to identify pairs on different AMMs that we feel could use additional liquidity. We understand the importance of this proposal of being clear about how we plan to spend incentives, and our goal is to stay flexible and adaptive about how to provide rewards in the best interests of the Moonbeam network. Regarding the timeline, we will coordinate with the Moonbeam Foundation and OpenBlock to determine the initial start time. The duration of the program shall be no less than eight months. We’ll leave the pairs open for incentivization after discussions with OpenBlock and the Moonbeam Foundation so we’re all aligned.
Hi everyone, my name is Paul, and I’m one of the co-founders of OpenBlock Labs. I wanted to make a comment here to clarify our role in the ecosystem. OpenBlock Labs is a data intelligence platform that provides curated insights that assist decentralized organizations with decisions about growth. Our insights serve as a data-driven perspective that are typically combined alongside other information and constraints, such as feasibility of execution and compliance.
For this particular use-case, we will be providing an analytics dashboard for evaluating the performance of liquidity managers, and showing which pools are driving the most volume and growth. Liquidity managers are encouraged to leverage this dashboard for recommendations on which pools may be the most promising in growing their KPIs. The community may also use this dashboard to see how liquidity managers compare, how they are utilizing incentives, and decide if further grants should be given. We believe this objective-based framework will be crucial for the long-term sustainability of the grants program.