Users will have four ways to benefit from an stETH-LDO liquidity pool.
Building up on the success of the recent OPIUM-ETH liquidity farming program, we are glad to announce another — and even more exciting — program, which we are calling “quadro farming,” as it offers users as many as four ways to collect rewards from an stETH-LDO pool.
Users providing liquidity to the pool will be rewarded in 1INCH tokens, they will also collect a portion of pool swap fees and some stETH tokens in accordance with Ethereum 2.0 staking APR. Finally, a proposal has been made to the Lido DAO to issue liquidity providers rewards in LDO tokens, as well.
The program starts on February 2, midnight (00:01 UTC), and will run for 4 weeks. 0.02% (300k) of the 1INCH token total supply will be distributed as rewards among the participants.
Our recent OPIUM-ETH farming program saw a five-fold relative price change, which led to a 25% impermanent loss. Still, it was fully mitigated by pool fees earned in the program’s first three days, while pool fees collected after that point will form liquidity providers’ profit.
The successful start of the OPIUM-ETH farming program comes as a proof that 1inch Liquidity Protocol works perfectly well for bootstrapping the liquidity of newly launched tokens.
“I see a massive potential in yield farming programs of this kind, as our liquidity protocol is well suited for bootstrapping the liquidity of new tokens in DeFi,” says Sergej Kunz, 1inch co-founder and CEO. “Tokens get protection from ‘pump and dump’ schemes as speculators would have to pay substantial fees to pump and dump tokens, and that wouldn’t be profitable for them.”
“As a result, tokens can benefit from our liquidity protocol as their price becomes more stable, facilitating successful development of the related projects,” he adds.