This proposal is expected to appear on Snapshot for voting on November 28, 2021 12:00 PM . Make sure to stake your vBNT for voting before this date and time to participate in the DAO decision.
TLDR
- The TRAC-BNT pool is the deepest on all Ethereum DEXes by roughly 2x, currently at roughly $5m.
- The current swap fee is 0.2%. An increase to 0.5% by 0.3% will most likely not impact volume as price impact is now lower than other DEXes.
- The TRAC community is very interested in staking on Bancor and would greatly benefit from the increased APR.
- An increased pool fee will also help siphon more profits from arbitrageurs.
The TRAC pool co-investment limit was recently increased [1]. The pool is currently full with roughly $5m in liquidity.
The TRAC/ETH pool on Uniswap v2 has a liquidity of US$559,800 (down from $679,352 when the co-investment limit increase was proposed), and the TRAC/ETH pool on Uniswap v3 has a liquidity of $474.12k (down from $579.85k when the co-investment limit increase was proposed).
This shows a tremendous commitment from the TRAC holders/community with staking on Bancor and benefiting from trading fees alongside single-sided staking and impermanent loss protection.
As the pool is now by far the deepest on DEXes, the community is proposing a change of the fee from 0.2% to 0.5%. This change should not impact volume significantly, as the price impact is considerably smaller on Bancor vs other DEXes.
As an example, a 5 ETH trade to TRAC on 1inch will route through Bancor and save 5% compared to Uniswap right now:
Figure 1 - 5ETH swap for TRAC routes through Bancor on 1inch.
Trades with larger amounts will accrue very significant price impact on any exchange apart from Bancor. A trade from 50ETH to TRAC on 1inch that is routed through Bancor can be found on Figure 2.
Figure 2 - 50ETH swap for TRAC routes through Bancor on 1inch.
The TRAC-BNT pool volume has been increasing, and had some significant volume ($12m) on the week beginning 1st of November (Figure 3).
Figure 3 - Weekly Volume for the TRAC-BNT pool.
Figure 4 - Weekly Fees for the TRAC-BNT pool.
Figure 5 - Weekly Volume and Fees for the TRAC-BNT pool.
As @glenn mentioned before on the co-investment increase proposal [1]:
If this becomes the deepest pool on DEXes by a large margin (once it fills up) then we should consider raising the fees on this pool to .5%. This would lead to more profit for LPs and less for arbitrageurs. We have had great success with other pools like $AMP, $wNXM, and $ARCONA (to name a few) where we have attracted the most liquidity and can therefore set a higher fee on the pool (since we have no competition from other DEXes).
[1] Proposal: Increase Co-investment Limit to 500K BNT on TRAC (OriginTrail) Pool
[2] Uniswap Info
[3] Uniswap Info