FAP: FAP 2
title: <FAP title> FAP2 UniV2 & UniV3 LP FEM/WETH Liquidity Provision from Multisig
network: <Ethereum | Polygon | Ethereum & Polygon>
status: <Draft> Official
type: <Meta-Governance | Governance> treasury governance
author: <a list of the author's or authors' name(s) and/or username(s), or name(s) and email(s), e.g. (use with the parentheses or triangular brackets): rachelg.eth (@bruleeshark), FirstName LastName <foo@bar.com>, FirstName (@GitHubUsername) and GitHubUsername (@GitHubUsername)> rachelg.eth (@bruleeshark)
implementor: <a list of the author's or authors' name(s) and/or username(s), or name(s) and email(s), e.g. (use with the parentheses or triangular brackets): FirstName LastName (@GitHubUsername), FirstName LastName <foo@bar.com>, FirstName (@GitHubUsername) and GitHubUsername (@GitHubUsername)> Council Multisig
release: (Release Name) FAP2
implementation-date: to be determined
proposal: <snapshot.org proposal link> https://github.com/Femboy-DAO/femboyDAO-action-proposal-2/blob/main/README.md
created: <date created on, in ISO 8601 (yyyy-mm-dd) format> 2023-06-20
requires: <FAP number(s)> n/a
We propose to add liquidity on uniV2 & uniV3 from our multisig funds. Amounts will be approximately equal to the market rate of FEM/WETH in the univ2 pool and slightly above that in the univ3 pool.
TLDR:
- 2 liquidity additions, +3 FEM per pool + ETH necessary, total liquidity of 6 FEM + ETH necessary.
- This represents around 7.84% of FEM total token supply, and about 7.08% of the ETH in the DAO treasury,* deposited as Uniswap liquidity.
There is very little FEM token liquidity and this makes it difficult for users to acquire the necessary 0.01 for membership and also any users wishing to have voting power in the protocol over a single membership find high slippage and fees, as well as a lack of available FEM on the market, as their barrier. We seek to meet the demands of the community and provide a base liquidity provision to Uniswap v2 and Uniswap v3.
The amount of liquidity provision in the proposal is projected to allow increased user activity in the foreseeable months.
Proposal for FEM token protocol owned liquidity provision: Proposal to add liquidity on uniV2 from multisig funds. 3 FEM + equivalent market rate WETH Proposal to add liquidity on uniV3 from multisig funds. Sell 3 FEM @ slightly above mkt rate (& therefore deposit no ETH). How does that work? Concentrated liquidity in uniswap v3 divides a position based on currentPrice vs priceRange, so we can avoid depositing ETH by setting priceRange slightly above currentPrice. Why do we want 2 liquidity pools on Uniswap? Primarily; reduced slippage. How? Partial routing to either pool through the uniswap smart router allows the uniswap protocol to utilize more of the total underlying liquidity for each trade, if necessary or if such conditions provide a more favourable trade. TLDR: 2 liquidity additions, +3 FEM per pool + ETH necessary, total liquidity of 6 FEM + ETH necessary. This represents around 7.84% of FEM total token supply, and about 7.08% of the ETH in the DAO treasury,* deposited as Uniswap liquidity.
Note*: Math and $ amounts subject to changes per market movements.
n.a
univ2 pool: https://www.geckoterminal.com/eth/pools/0xa326324ef5c44789017232a28cc13af61edb9d5e
univ3 pool: https://info.uniswap.org/#/pools/0x7fc309033216f5af765d74b81941d1239efa93fd
uni pool parameters already set at deployment, see above links.
Copyright and related rights waived via CC0.
shoutout to @synthetix team for the original Improvement Proposal Template