Thread by @AgilePatryk

Things no one told you about the @astroport_fi lockdrop yet.

🧵👇

/1

There are already a few community-built tools that help you assess the potential of locking into a particular LP - a few links below:

terra.dyor.fi/astro-lockdrop
share.streamlit.io/lejimmy/astrop…
astroport-lockdrop-dashboard.surge.sh
public.flourish.studio/visualisation/…
docs.google.com/spreadsheets/d…

/2

Please give the creators a follow as a gesture of gratitude for the work they have done:

@0xdef1
@lejimmy
@azmo1338
@tansawit
@IncioMan

/3

These tools take quite a bit into account:
- Overall $ASTRO per LP (lockdrop + regular rewards)
- Liquidity / TVL on TerraSwap
- TVL locked so far
- Lock duration (avg and yours)
- $ASTRO price
- Your TVL contribution

There are certain aspects that seem to be missed.

/4

Those are:

(1) Changes in LP rewards
(2) Impact of $vxASTRO
(3) Changes of base APR (coming from trading fees) upon migration from TerraSwap to @astroport_fi

/5

(1) Changes in LP rewards

If you think you can lock $ANC - $UST for 52 weeks and enjoy sweet 88.31% APR + $ASTRO rewards, well... that's not going to happen.

$ANC LP incentives have been scheduled only for year 1. That is we will bid them farewell in March 2022.

/6

End of March 2022 is ~ 14 weeks away from the locking start.

Once that period ends, ANC-UST LP will only provide base trading rewards - currently 5.39% on TerraSwap - and $ASTRO incentives.

Don't get me wrong - that might still be a pretty good deal, just not as good.

/7

A quick look at the tool showing # of wallets that locked for a certain period and I can tell that the above is not very well known... or maybe peeps don't care that much - who am I to judge?

Honestly, I expected much bigger concentration on week 13-14 than currently.

/8

The same story goes for other pairs:

- $MINE - $UST LP will cut $MINE incentives by 3x
- $PSI - $UST LP incentives might vanish entirely once @NexusProtocol builds some Protocol-owned liquidity (PoL)
- $VKR - $UST LP incentives will be cut by 2x on 13 Oct 2022

/9

Does that mean you need to change your decision? Not necessarily.

Would it make sense to reevaluate at least? Perhaps.

/10

(2) Impact of $vxASTRO

Once we get our sweet $ASTRO we will be able to stake it and get $xASTRO and then lock that to get $vxASTRO.

Amount of $vxASTRO (and some other factors) will impact the amount of regular $ASTRO incentives provided to each LP pair.

/11

I could not find detailed info about that (plz halp @astroport_fi, maybe one of your interns can describe it in the docs - current description is just not good enough).

I can see a couple of ways this could play out.

/12

EITHER

Current official allocations of $ASTRO to each LP have underlying assumption of equal $vxASTRO boost to each pool.

OR

There is an extra bag of $ASTRO for boosting that will be added to each pool according to booster formula.

/13

I know, this sounds vague and we know not much about it... still, I have not seen anyone mention that yet.

Well, now you have. :)

/14

(3) Changes in the APR after migration

Basic income of any LP comes from trading fees. TerraSwap charges 0.3% on any swap and that whole amount goes to LP providers. Quite generous.

It won't be like that with @astroport_fi.

/15

For regular pairs with x*y=k AMM the fee will still be 0.3%, but only 0.2% will go to LP providers. A drop by 1/3 vs TerraSwap.

Whatever you see on coinhall.org/terra/pairs in the APR column, remove a third from that to get the @astroport_fi base APR (before any incentives).

/16

Even more for the stableswap pairs (e.g. $bLUNA - $LUNA). Here 0.05% will be charged as a trading fee, with only 0.025% going to LP provider pockets.

0.025% vs 0.3% - a factor of 12x difference.

/17

Should that discourage any of you from locking LPs in @astroport_fi or providing liquidity at a later date?

Hell no! I am definitely going to lock, and likely will lean towards longer timeframes.

I hope you do it knowingly though. I hope I helped with that part. ;-)

/18-end