The Bancorian | A Weekly Summary-October 17th 2021

This post was originally published on Bancor network

đŸ’»Development

Our developers have been working on Bancor V3 and good progress is being made on the next version.

This week, we finished the integration of two new wallets and made them available on the front end. Users of XDEFI Wallet and Gnosis Safe can now interact with the protocol via either of these wallets. We think that the Gnosis Safe integration will be particularly useful in attracting more institutional capital into the protocol due to its popularity among institutions for its multi-signature capabilities.

New UI screens have been pushed to the beta interface that we are looking to get feedback on. This includes:

These new interfaces are being added to beta.bancor.network which is powered by our new APIs and performance will be faster. We will eventually shift the entire web app over to the new, faster interface.

🌐Ecosystem

🌀Bancor Vortex

For this week, we saw roughly ~41K in $vBNT that was burned by the vortex. At current BNT prices (~$4) this equates to ~$164K worth of $BNT locked forever. 🔒

+-----------------+--------------+
| time | burnedamount |
+-----------------+--------------+
| 10/10/2021 0:00 | 3099.134827 |
| 10/11/2021 0:00 | 3699.216672 |
| 10/12/2021 0:00 | 5122.920627 |
| 10/13/2021 0:00 | 8554.968006 |
| 10/14/2021 0:00 | 4577.655421 |
| 10/15/2021 0:00 | 8465.28402 |
| 10/16/2021 0:00 | 7441.114304 |
| Sum | 40960.29388 |
+-----------------+--------------+

The cumulative burned amount increased from ~1.286m on 10/9 to ~1.327m on 10/16.

📊Key Metrics

Token terminal hasn’t updated the Bancor data since October 11th and we are missing metrics for the past few days. Some of the typical data that we provide has been omitted for now until the metrics are available again.

Source: token terminal

The information below has been extrapolated from the past 21 days in which we have done ~1.31m in total fee revenue. On average, this is about ~62.4k daily in fee revenue which leads to:

  1. 7-day total cumulative fee revenue: ~$437K
  2. 30-day total fee revenue: ~$1.87m

Annualized, that’s around ~$22.7m in annual trading fees paid to LPs.

🔌Integrations and Updates

  • The unFederalReserve buyback went live on Bancor last week and we are already seeing the impact in volume on that pool. Following Harvest Finance and Ferrum Network, this is the third project using the Bancor pools for their buyback mechanism.
  • The $SPELL token was whitelisted on Bancor last week with a 1m $BNT co-investment. The liquidity in the pool is starting to grow and we could use the community’s help in spreading awareness about the $SPELL pool. It is a particular hot DeFi token at the moment and the IL (Impermanent Loss) on the current Sushiswap and Uniswap pools has been high.
  • There is a tool (revert) that analyzes liquidity provider (LPs) returns and we can see that there have been some large losses for $SPELL holders providing liquidity in other DEXes. These LPs are effectively shorting the $SPELL token and we think that our offering of single-sided liquidity with IL protection is a better option.
  • New Layer3 bounties are live. If you haven’t seen them, make sure you take a look so that you can help us spread the word and get paid $BNT for doing so. The first bounty focuses on explaining Bancor’s IL protection, the second on explaining single-sided liquidity, the third is relating to impression mining (the number of impressions if you post a thread on Bancor) and the others are incentivize sharing of Bancor video explainers.
  • Steven who works Bancor’s business development will be in Lisbon this week. If you are going to be there, please let Steven know. We love to meet up and chat. His telegram is @FoxSteven
  • We are attending an event in Miami from November 30th-December 1st 2021. The event is called DCentral Miami and we are planning to have a pretty significant Bancor presence there. We are looking forward to doing a few talks on Bancor V3 and Impermanent Loss. If anyone is considering going to DCentral Miami, please let us know as we love to meet up. Depending on how many are planning to attend, we might even throw an event of our own.
  • We recently hit a pretty big milestone with the Bancor vortex. 2% of the $vBNT supply has now been burned and the underlying $BNT is now locked in the protocol forever. We have a proposal in governance this week that is looking to increase the burn rate from 10% of swap revenue to 15%.

đŸ’ȘSocial Channels

🚹 Call the fire squad and 911

This was quite an eventful week with the Bancor Vortex 🌀 now having burned đŸ”„ a total of 2% of the $vBNT supply. The burn rate for the Vortex is currently 10% which means that 10% of swap fees revenues is used to buy $vBNT and burn forever. Since $vBNT equates to lock $BNT in the protocol then that means that the protocol is locking liquidity for eternity. While this concept of protocol-owned liquidity has recently become popularized, note that Bancor was one of the first pioneers in this area with the vortex.

Yikes‌ It’s quite surprising how many DeFi users are still blind to the perils ☠ of Impermanent Loss (Divergence Loss). There is still a lot of education that needs to be done around this area but we are starting to see great tools (check out revert which makes this easy to digest) being developed. Our efforts in educating the general public with regard to IL will always be ongoing as we consider this a key area of focus. The animation below was created by a community member and it does a great job in visualizing IL.

đŸŽČRandom Musings

As passive liquidity maximalists, many #bancorians at the launch of Uniswap V3 concluded that professional market makers will ultimately be the greatest beneficiaries. That’s because Uni V3 requires LPs to take a more proactive approach in managing their positions and ultimately the majority LPs who are looking for passive yields don’t have the skills required to take on such a task. This has led to professional market makers profiting off everyday holders who are not privy to these complex strategies. Ultimately the pros are earning the majority of fees and also siphoning rewards from any incentivized pools.

We have discussed some of the recent announcements around Bancor V3 in previous Bancorians publications but perhaps the fact that $BNT in Bancor V3 will be indistinguishable from other $BNT (regardless of pool) might have been missed. Could this mean that you no longer have to move $BNT between pools when an LM campaign expires? 👀 Let me know your thoughts 👇

A great explanation of how IL protection works. The FUD with regards to the protocol minting $BNT endlessly creeps up every now and again but ultimately the fact remains that there has been very little $BNT printed to cover IL suffered by LPs. If you happen to be good at creating graphics or animations then we could use your help and there is a 100 $BNT bounty available if you can explain this simply.

More projects realizing that Bancor protocol is the best place to implement their buybacks. Also, a great destination for any projects with treasuries that are looking to earn passive yields with very little risk.

đŸŽ©Bancorians in the Wild

A collection of weekly tweets from some of the greatest Bancorians🧠đŸ’Ș

☑Governance

👈Previous Proposals

This past week (10/10/21), we saw several proposals on snapshot that were able to meet quorum and supermajority requirements:

We also saw a number of proposals that weren’t able to reach quorum requirements:

👉Current Proposals

For this week (10/17/21), we have the following proposals up for voting:

Head over to snapshot to cast your votes.

❗If you aren’t voting regularly make sure you unstake your vBNT from governance and delegate instead. Self-nominated delegates maintain a page on Discourse to inform other community members of their intended voting behavior. If you disagree with the way your delegate votes, you can always vote manually to override their decision on your behalf.❗

📞Bancor Weekly Call

In this week’s Community Call recording, Bancor shared the development updates above and featured two teams to discuss collaborations with the Bancor ecosystem: Index Coop and Etherisc.

Index Coop (19:35)

“Index Coop creates and maintains crypto index products. All index products are always fully collateralized. Index Coop is a Decentralized and Autonomous Asset Manager governed, maintained, and upgraded by INDEX token holders. Their products are built on Set Protocol’s battle-tested V2 infrastructure. Product methodologies are sourced from industry experts like DeFi Pulse”.

Index Coop is proposing a Bancor whitelisting of their INDEX token since liquidity on existing pools is thin; the team themselves don’t like getting rekt by IL. INDEX holders discuss liquidity frequently due to its importance to the project’s success, but most people are currently buying and holding due to IL risk, even in spite of LM rewards being offered on Sushiswap.

Index Coop would always point people towards DEX aggregators to trade INDEX, and whitelisting is likely to grow the size of Bancor’s trading volume market share for INDEX by virtue of deep liquidity and low trading fees.

Etherisc (34:40)

“Etherisc’s mission is to build decentralized insurance applications, making the purchase and sale of insurance more efficient, enabling lower operational costs, increase transparency of insurance compared to traditional operations, and democratize access to reinsurance investments”.

Their community recently proposed to have their Decentralized Insurance Protocol token (DIP) whitelisted on Bancor — the preferred choice of AMM for many holders given the good synergy between the two communities.

It was also noted that recent price volatility on DIP makes Bancor a particularly good destination for its LPs.

People can currently people can stake DIP in the Etherisc staking contracts. The Etherisc team proposes taking a portion of this staked DIP into a whitelisted Bancor pool.

Q&A (51:58)

Is there an update on the front-end reworking of the contract for re-staking and unstaking gas costs?
It’s still in the preliminary stages, but the development work required is not too significant. So far, it’s looking encouraging that gas costs on Ethereum L1 will come down significantly with this change.

One consideration is an option to claim rewards from a single position at a significant gas reduction. This would work because the contract wouldn’t need to read data from all active positions.

V3 gas costs and subsequent migrations will offer much more profound cost savings than this; this implementation is just to tide us over in the meantime.

đŸ€Connect Projects with Steven, Bancor Business Development Lead:

  • Are there tokens you’re holding that we should whitelist on Bancor? DM @FoxSteven on Telegram about it or connect us with any community leaders/core contributors on the project. Steven leads all our BD efforts and will connect with the team and work with them to get whitelisted or build a deeper pool.

📔Bancor Grants:

  • We have content grants active at all times. Any users that want to create videos or guides, please reach out to Nate Hindman (@NateHindman on Twitter or Telegram).
  • We have analytics grants. If you want to work on Bancor data projects or if you are good with working on blockchain data and APIs, we can always use your help!
  • As always, we have rolling developer grants for those who want to build and innovate on Bancor’s infrastructure.

📓Bancor Resources:


The Bancorian | A Weekly Summary-October 17th 2021 was originally published in Bancor on Medium, where people are continuing the conversation by highlighting and responding to this story.

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