Gotta laugh!
Half of Uniswap V3 Liquidity Providers Underperform Holding: Bancor Study.
The study is by archenemy, Bancor - even funnier.
I have advised on many occasions that you have to understand how Uniswap works, or suffer the consequences.
Important paragraph:
Our core finding is that overall, and for almost all pools, both the minimal and actual IL surpass the fees earned during this period. In other words, the average liquidity provider (“LP”) in the Uniswap v3 ecosystem has been financially harmed by their choice of activities and would have been more profitable simply holding their assets ("HODLing”). Importantly, this conclusion appears broadly applicable; we have collected evidence that suggests both inexperienced retail users and sophisticated professionals experience a comparable struggle to turn a profit under this model, with the exception of “flash LPs” (aka just-in-time or “JIT” liquidity providers) who provide liquidity for a single block, to absorb fees from upcoming trades, then instantly remove their position. This cohort generated a modest $1.27m in fees while incurring zero IL.
Hidden within the paper, it mentions in passing that Bancor itself has impermanent loss insurance on many of its pools.
The analysis also excludes incentivised pools, where liquidity providers receive staking tokens on top of any share of the trading fees.
There should be a warning sign, like in some swimming pools: Do Not Dive!
Buy BLURT on Probit, Ionomy, Hive-Engine and STEX.
Buy BYT on Hive-Engine
BYT Backs: Reward Distribution of 104% APR for 15 November 2021
BYT Backs: Reward Distribution of 96.1% APR for 8 November 2021
BYT Backs: Reward Distribution of 33.1% APR for 1 November 2021
BYT Backs: Reward Distribution of 37.6% APR for 25 October 2021
BYT Backs: Reward Distribution of 37.9% APR for 18 October 2021
Rewards of 35.7% APR for 11 Oct 2021 = Rewards of 36.5% APR for 4 Oct 2021 = Rewards of 35.9% APR for 27 Sep 2021 = Rewards of 37.2% APR for 20 Sep 2021 = News BYT: Rewards for 13 Sep 2021
News BYT: Minimum BYT Holdings
BYT: Blurt Yield Token Guide (best basic info)
You have brought an important information. And your advice is also fantastic. You have sense of humor as well.
Congratulations, your post has been curated by @r2cornell-curate. Also, find us on Discord
Felicitaciones, su publication ha sido votado por @r2cornell-curate. También, encuéntranos en Discord
Will be interesting to see if this is the case with the recent blurt liquidity pools. I initially said that I would give 10% of my portfolio to liquidity but then the bridge minimum ended up being more than 10% of my portfolio so I slowed down. There were massive gains of blurt during this time and from what I understand this could contribute to impermanent losses. I now have the 30,000 blurt to bridge over but I am cautious now because of the potential for blurt to go higher still.
It is nice to have so many options though now.