In the current model, $LUA isn’t central to any value building strategy. As it’s stands, there are no reasons for traders to consisently buy $LUA except for speculation purposes.
Furthermore, most of the buying power behind $LUA is coming from the protocol. I believe this power should be given to traders. A single trader alone can outweigh the buying power from the protocol if $LUA is the backbone of their wealth building mechanism.
For now $LUA isn’t the backbone but the exit token. Liquidity providers farm $LUA to sell it to cover for impermanent loss. Stakers stake $LUA to sell it. Liquidity providers will not provide more liquidity for the sole purpose of farming $LUA since the value of $LUA and APY are declining.
I propose that $LUA becomes a utility token for traders, making $LUA a token that is necessary to earn and to buy if one wants to build their wealth. We can resume my proposition in just a small sentence: pay the staking rewards in the token being swapped, in $BTC, $ETH or any other denomination involved in the transaction.
“Pay the staking rewards in the token being swapped, in $BTC, $ETH or any other denomination involved in the transaction.” —> I don’t want a dozen of super small denominator. I want LUA which earns > 50% APY at the moment,
Staking sats by staking LUA. Is there anybody who doesn’t want it? I don’t think so. And the same will likely be true for ETH and TOMO. As Long said, to split rewards in tens of different tokens/coins won’t be exciting for many people but getting BTC, ETH and TOMO in equal shares would.
Instead of focusing on the sizes of denominators we should maybe first adress the idea of turning $LUA into a utility to farm other tokens. We can adress the “small denominator” issue afterwards. I think most people would rather earn grams of Gold each day, than tons of “nothing”. The small denominator issue is purely “cosmetic”. It’s the value that counts.
$LUA should be earned by providing liquidity and nothing else. Giving it to stakers goes against your primary goal to attract more liquidity providers. In my proposition, all the mechanism is built towards turning $LUA into a utility token in order to attract liquidity providers who will want $LUA (for its utility).
If I understood correctly, you agree with my proposition but you’d rather the payouts be consolidated into fewer valued currencies like $BTC, $ETH or $TOMO? That would be great. In fact it was the first iteration of my proposal. Ultimately I thought that paying out in the token being swapped was the fairest system for all and doesn’t create uncessary selling pressure on the other projects.
Staking LuaSafe earning LUA because it makes sense:
LUA is not “nothing”. It is LuaSwap’s protocol token whose value correlates with LuaSwap’s value. The latter is valuable, then the former is valuable.
Currently you earn ~ 50% APY in LUA in LuaSafe, but if you pay in other denominator there will be no APY number. It is a serious issue as everyone asks about APY number. It makes sense that you earn what you put in.
LUA can have multiple utilities. Being used in liquidity pair, in voting, in LuaSafe are multiple LUA’s utilities and make people buy LUA for these utilities.
I completely agree, LUA represents the value of LuaSwap. And LuaSwap will have unique features when moved to Tomochain which are poles apart from many other DeFi projects where APY is the only feature they have. If you browse the chat groups many people have no idea what APY even means or how they can calculate it by themselves. Let’s leave aside that APY of a token which loses value over time in comparison to a currency you buy food with is useless.
Long story short, I want that LuaSwap shines with its unique features! Who knows them better than those who made this features possible…
We are giving out $LUA to entice liquidity providers. If the price of $LUA isn’t rising, we won’t attract LPs. You are saying that $LUA depends on the success of Luaswap. I agree and disagree:
-I agree because $LUA wouldn’t exist without Luaswap
-I disagree because how would you explain the fall of TLV? Luaswap has been improved from the beginning. What would explain that fall in TLV if not for the fact that $LUA isn’t attractive enough to LP. If you disagree, then do you think TLV would still be falling if LP’s were rewarded in $BTC for example?
The APY issue is simply a matter of communication and technical work around. This shouldn’t stop us from innovating in the space. My proposition doesn’t stop people from earning according to what they put in.
These utilities aren’t valued by users as the price action is showing us.
Earning $LUA by staking $LUA is too redudant. It’s like planting grains of rice to grow more grains of rice…
You shouldn’t correlate one feature with price of LUA which depends on a thousand of factors that are out of your control or mine. The fact that you make arguments using these false reasoning is comical.
Saying reward in LUA/ BTC/ USDT is not as important as “How much” is the reward in term of capital spent to acquire the position which is APY. LUA is chosen for the ease of conversion/ integration and because it is the protocol token.
I am going to end my debate here as I don’t think I have more to add.
How does the current Twitter voting fit to your statement here and actually the basic agreement ‘LUA is used in voting’?
I don’t say it’s a bad thing since also the previous procedure to use only unlocked/unstaked LUA for voting doesn’t really represent investors or real interest in the project.
There are different level of decision making to improve the responsiveness and efficiency of the protocol. Governance voting is used to decide key system changes. It is not suitable for day-to-day operational decisions which will be made the core team. We use Twitter because there are more people there and easier to promote the project.
Since obviously only we both are left in the conversation, I just want to agree, the mechanism ‘hoarding token to increase the amount of this token’ doesn’t increase value per se. There’s no perpetuum mobile.
I have a decent amount locked LUA. If this LUA was rewarded in BTC after it’s unlocked and put in LuaSafe (or however this is called) I would do that. If not then it depends how LUA performance has been, probably swap LUA for BTC or other coin on a regular basis.
You have created a story in your mind that makes you believe that the price of $LUA is out of your control because there are “thousands of factors”. This implies that you don’t even know why $LUA is declining as well as the TLV. That is the comical part.
Luaswap is a straightforward platform and traders are rational actors: they see no value in $LUA in the current form, that is why the price is declining. Even with increased TLV, which might happen after we run on Tomochain, the price would still be going downward as it is for most farming coin. But I bet you are happy to see $LUA go down since its the same for others anyway.
If you look at other comparable farming token, they are all going downward.
$UNI started from higher up and with better recognition but in the long run it is also going in the same direction. Even if Luaswap succeeds in increasing it’s TLV, it wouldn’t turn $LUA into an in-demand currency since there is no mechanism that promotes a buying decision. $LUA is a loss cutting, exit token. You earn it and sell it to cover impermanent loss. Nobody is going to want to buy it excepts those who believe that a governance token with 500 million supply is a “rare commodity”…
We are talking about a very specific feature and you basically think that is the one and only thing that affects TVL and LUA’s price? Why so simple-minded?
It is basically non-sensible to have a rational debate with people like you because you are blaming everything on earth just to push your one litter argument.
The core team did build product/ business up to this point. The question is why are you so sure about your arguably unqualified opinions? Could you please show me the evidences of the kind of business/ product decisions you made in the past that contributes to successful business/ product?
I am doing very well for myself thanks. There is no need to make this argument about me. You should respect the rules of the forum and keep it project oriented and respectful.
That being said your question doesn’t suprise me: you seem to follow what other projects are doing without ever trying to make the first move or innovate. That’s how you justify the various fees added in the protocol: “because Uniswap did or Metamask is doing it…” so you follow their path. That’s also perhaps why you launched Luaswap and $Lua, because Uniswap existed with $UNI and Sushiwap with $SUSHI. It seems that you will only launch something similar to my idea if another project does it first.
Why I am so sure that my idea will work? Because it makes logical sense, because you cannot argue against it without attacking me. I also did a poll in TG to measure interest. I dare you to do a similar poll and see if you get as many favorable votes than mine. So far your only “valid” argument was:
I don’t want a dozen of super small denominator
And I believe I answered it logically.
Now, instead of attacking me, can you enlighten me and tell me why we are losing TLV and demand for $LUA is weak or are you finding that question so difficult to answer that attacking me is the easiest thing to do?
as many others in our core team. We can agree to disagree. There are a million of $LUA buy order on FTX if anyone wants to sell.