Introducing Lyra Liquidity Provision
Today we are excited to officially launch Lyra’s ETH Market Liquidity Pool with a two week liquidity mining program! This will allow Lyra to provide significantly more trading volume and offer better pricing. To get started providing liquidity, head to the pools page of the dApp.
For the last 48 hours, Lyra has been incentivising the sUSD/DAI pool on Uniswap to encourage the migration of sUSD by Synthetix stakers to OE. Over $9M has been deposited and it is now the largest pool on OE Uniswap. It is great to see so much activity and momentum from the Lyra and Synthetix communities moving funds to OE. Lyra will continue to incentivise this behaviour until at least Monday 27 September 00:00 UTC.
One of the main benefits of increasing the sUSD supply is that we can open up the ETH Market Liquidity Pool to the public. Recall that Lyra is an AMM that requires sUSD to act as collateral, facilitate payments and hedge risk. LPs are a pivotal part of Lyra, allowing the AMM to facilitate a seamless experience for traders, who can buy and sell options across liquid markets. In return, LPs can expect to collect trading fees from the pool, plus or minus any profit/loss that occurs from the trading activity of the AMM.
For the first two rounds of trading, the LyraDAO provided 500,000 sUSD as liquidity to the $ETH market. This allowed us to test the mechanism in realistic conditions, but is not sufficient to serve the significant demand to trade on Lyra. Restricted liquidity provided a suboptimal trading experience due to a limited trade size and high slippage. In order to scale, Lyra must find a sustainable way to incentivise liquidity provision.
Today, we are launching the ETH Market Liquidity Pool in our trading dApp, allowing anyone to provide liquidity. In addition, 375,000 $LYRA (as per LEAP-3) will be distributed to LPs in proportion with their share of the total eligible liquidity in the pool. The rewards earned during this program will be distributed when the LYRA token is officially launched. More information about the LYRA token will be released in the coming weeks.
Before considering depositing, it is essential to understand that providing liquidity carries a number of risks. You can check out a detailed description of the risks here.
Lyra ETH Market Pool
Deposits begin: Thursday 16 September 09:00 UTC
Deposits close and incentivised round starts: Friday 17 September 09:00 UTC
End: Friday 1 October 09:00 UTC
Amount: 375,000 $LYRA
This program is targeted at those interested in providing liquidity to Lyra’s ETH Market Pool. Those who provide liquidity to the pool will receive LYRA in proportion with their share of the total eligible liquidity. To be eligible for rewards, liquidity must be provided before the round begins (i.e. before Friday 17 September 09:00 UTC).
Once the round has started, it will not be possible to withdraw liquidity until Friday 1 October 09:00 UTC. Please make sure that any funds deposited do not need to be accessed before this time.
How to deposit:
- Open the pools page for the Lyra ETH market and press "Deposit"
2. If you don’t have sUSD, you will be prompted to swap to sUSD.
3. Press "Allow Lyra to deposit your sUSD" to allow Lyra’s liquidity pool contracts to deposit your sUSD.
4. Finally, press “Deposit” to deposit your sUSD to the pool. You will be given a liquidity certificate representing your deposited sUSD.
5. You can view your liquidity certificates on the ETH pools page.
6. All certificates will be marked as “Waiting for the next round”. When the next round starts, your certificates will become locked for a 2 week round. This means they are being used by the AMM and are earning Lyra rewards.
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