Let’s get a fews things straight:
Eliminating impermanent loss is impossible.
Bancor has never eliminated IL risk.
However, it is possible to TRANSFER IL risk.
Bancor transfers IL risk from LPs to $BNT holders, who earn rewards for managing IL risk.
Eliminating impermanent loss is impossible.
Bancor has never eliminated IL risk.
However, it is possible to TRANSFER IL risk.
Bancor transfers IL risk from LPs to $BNT holders, who earn rewards for managing IL risk.
When protocol fees > IL compensation, $BNT holders profit
The key role of the #BancorDAO is to manage IL risk & earn fees by:
- whitelisting tokens that earn more fees over time than IL
- seeding performant pools w/ BNT co-investments
- deploying LP incentives (BNT rewards)
The key role of the #BancorDAO is to manage IL risk & earn fees by:
- whitelisting tokens that earn more fees over time than IL
- seeding performant pools w/ BNT co-investments
- deploying LP incentives (BNT rewards)
In its ~9 months live, IL compensation has resulted in low levels of BNT inflation (<5%).
Fees earned by the protocol have proven to be a resilient buffer against the cost of IL compensation, while still driving some of the highest yields in DeFi on 70+ assets.
Fees earned by the protocol have proven to be a resilient buffer against the cost of IL compensation, while still driving some of the highest yields in DeFi on 70+ assets.
The industry’s first IL protection solution has yielded millions in fees & some fascinating findings -- and it's ready to evolve 🦖
We look forward to sharing more on the next phase of IL protection in #BancorV3
We look forward to sharing more on the next phase of IL protection in #BancorV3
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