Splinterlands DEC-Grain Pool Current APR: 22.27%
On May 14th, the Trade Hub was added to the Land Expansion of Splinterlands. That includes the ability to trade between Grain and DEC (for now), but also to provide liquidity in return for half of the swap fees.
The swap fees are set at 10% according to the Land 2.0 whitepaper, of which only 5% are paid to liquidity providers, with the rest being burned. In Land 2.0 there will be a way to reduce the burned portion of the swap fee.
Although calculating the APR when LPs are rewarded from swap fees is an unreliable metric, since it can vary significantly depending on the volume of swaps in the pool, I wanted to make this calculation to have some sort of idea where this stands at this time.
How did I calculate it? Anyone who has done this calculation manually before should know...
I took the TVL at this moment, that is 40,740.66 US Dollars.
I also took the total swap fees earned by LPs, which is 547.00 US Dollars:
I calculated how many days have passed since Trade Hub is live: 22 days (excluding today).
In consequence, APR = 547/40740.66*365/22 = 0.2227 (otherwise said, 22.27%)
Note that, the longer time passes, the more irrelevant it is to calculate the APR based on swap fees earned starting from the day when TradeHub was launched. In the future, it would be useful to know the swap fees earned in the last 7 days, for example, for a more accurate APR at the time of calculation.
Some additional remarks could be useful:
- there is no additional inflation used to pay for these LP rewards
- TradeHub is a deflationary feature, since it burns up to half of the collected swap fees
- this APR is likely to be quite volatile based on trading volume variations over time in the pool
- Grain-DEC LP is only available for Land owners, unlike the Splinterlands LPs incentivized with SPS, or staked SPS
- the LP shares autocompound with each swap fee collected, so there is no Claim button to click to collect the rewards
- withdrawing from the Grain-DEC pool before 30 days have passed incurs a 10% fee that goes to the remaining liquidity providers
I am not a big Grain holder/producer, but I jumped into this pool from the start, and continue to add to it. It's one of the reasons for my new Grain productivity boost goal.
Want to check out my collection of posts?
It's a good way to pick what interests you.
Posted Using InLeo Alpha
Sorry but how to get into the Grain DEC LP? I can't seem to find this LP in beeswap.
You won't find it as a diesel pool. If you are a Splinterlands landowner, you can see it from Land -> Trade Hub (button at the top) -> Markets -> Manage (Add/Remove).
Around launch I calculated a 182.5% APR for the DEC:Grain Pool. High volume + low liquidity is great for those who have LP positioned. The current 22.27% APR may not change drastically for some time. If SPS reach higher prices, Grain itself will become more valuable. The best will come with Land 2.0.
I like that Grain has held its value pretty well. I expected some Grain dump for DEC, but looks like people do have a long term perspective.
Bear market got rid of the weak hands. We barely have any short term investors around.
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Wow then it will be cool to Jump into the Grain-DEC pool from the get-go, I'm very interested in the potential for this liquidity setup amazing bro. Excited for the future tweaks to fine-tune APR accuracy. Hope it doesn't take too long too
It's not as much about accuracy as it is about fluctuating swap volume. If one week a whale swaps a lot of grain and the next week the swap volume drops by comparison, then, the APR determined based on the swap fees of week 1 is much higher than the APR calculated based on the swap fees of week 2.
Oh wow you're right on that then I guess swap volume is what attention should be on🤔
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I had played a little with land, but got frustrated since the investment on order to earn something with it is quite high. With the swap, it is now possible to have some earnings from early on, and slowly grow the stake without having to invest as much. Always depends on how much time one is willing to wait :-D
Indeed. I am one who focused on research from the start. But in the meantime, the investment needs to be sustained somehow.
It sounds like a decent pool. I know that the DEC related pools did give a decent amount in fees and I think the grain pool could also. After all, people will need grain and others want profit from their land.
Yep, it already is a good addition for land owners, but we can't do without it in Land 2.0.
I’ve always heard about land on splinterlands
Is it also another section of the game because I only know about the fights
Yep, it's another game mode in Splinterlands.
I wish you good luck in your grain boost goal
Go harder!
Nah, my main focus on land remains research. But with Grain-DEC LP, that's a way to leverage land sooner than research would show some results.
This is a good opportunity for investors here to earn some good returns by doing so.
Used to be a pretty exclusive club, but with land so cheap, now most people can afford to become landowners.