In the last AMA, the SaucerSwap community inquired about HBAR liquidity and how it could be further incentivized to reduce slippage and increase native staking rewards to xSAUCE holders. Community members also asked whether the protocol would direct emissions away from HBARX pools and to SAUCE pools.
Hashburglar’s response is paraphrased as follows:
I’ll reiterate that our top priority remains to bootstrap liquidity in high-demand pools, with the primary metric by which this demand is gauged being trade volume. We are committed to attracting and retaining HBARX liquidity on our DEX. However, it will be limited to select token pairs like HBAR / HBARX and USDC / HBARX. There is much more HBAR liquidity on the network, so it’s more practical to use this token as a base. One must also consider the benefit of an increased HBAR balance to xSAUCE holders due to PoS reward harvesting. We will adjust the farm weights to incentivize new and existing SAUCE, xSAUCE, and HBAR pairs in the coming days and weeks.
Therefore, we are incorporating feedback from our community with the following actions:
Increased incentives to SAUCE pairs
After further consideration, we have decided to achieve these common objectives by increasing the weight of emissions to the SAUCE / USDC, SAUCE / HBAR, and xSAUCE / HBAR farms, with SAUCE / USDC getting a significant boost.
New LCX farm
Furthermore, we have created an LCX[hts] / HBAR farm, which presents a unique opportunity of being one of a handful of on-chain, decentralized markets for this asset. LCX is the platform token of a regulatory-compliant exchange of the same name based in Liechtenstein. There is a large subset of HBAR holders who share a common interest in the LCX token, so it makes sense to bridge it to Hedera via hashport (hence the [hts] subscript).
Reduced emissions to HBARX pairs
As part of our initiative to partially move incentives away from HBARX and towards HBAR pairs, we have deprecated the SAUCE / HBARX farm. Liquidity providers in this pool will continue to receive LP rewards from swap fees. Farmers, however, will stop receiving rewards and can find the SAUCE / HBARX farm in the “inactive” tab on the farm page.
In addition to incentivizing SAUCE pairs, the freed up emissions are better directed at new, high-demand pairs like LCX[hts] / HBAR, rather than an arguably redundant pair like SAUCE / HBARX. This follows from the response given in the last AMA. Also following from the AMA, an increased balance of HBAR in the WHBAR contract will amplify native staking rewards, which are distributed to xSAUCE holders in the Infinity Pool (current APR ~ 15%).
Adjusted community farms to reflect demand
Finally, we have ended the liquidity mining campaigns for three community farms: SAUCE / LIL, SAUCE / QUACK, and SAUCE / WHALE. While we enjoyed bootstrapping liquidity for these projects, we now think rewards from swap fees will act as a sufficient incentive to continue LPing. For example, the LP reward APR of SAUCE / WHALE is currently a respectable 12.85%. In an effort to adjust for demand, we have reallocated these emissions to SAUCE / LUCKY, whose liquidity has risen to an impressive $350k.
Beyond this, we have made several minor farm adjustments to account for market demand.
Overview
A summary of changes to SaucerSwap farms is as follows:
Please note that the single-sided staking APR is not included in the farm total APR displayed on the farm page. To determine the actual farm total APR, add ½ the single-sided staking APR to the current farm total APR.
Ex: farm total APR( SAUCE / xSAUCE ) = 12.64% + ½ (15.06%) = 20.17%
Conclusion
These adjustments to our farm weights further incentivize HBAR and SAUCE pairs, such that the liquidity of those tokens can deepen, and single-sided staking rewards can increase. Furthermore, we are proud to welcome the LCX community to our DEX so they can receive staking rewards on SaucerSwap. If you have any questions or thoughts on the above, join the conversation on Discord.