Liquidity Mining Program Update: Week 4 and Reward Payouts

Written by
Romana Basilaris
Marketing Manager
July 31, 2020

We’re happy to announce the successful distribution of the Week 1-3 payouts for Liquidity Providers, totaling 400 599 in PLR rewards provided by the Pillar Foundation.

For those who missed it, we recently launched a rewards program for the PLR/ETH Uniswap V2 pool to kickstart liquidity as we transition to a community-owned DAO. The response has absolutely exceeded expectations and we’re excited to not only continue, but ramp up the rewards in the coming weeks.

Below is an overview of the rules and payouts for each week, as well as information on Week 4, which is kicking off at 00:00 UTC on July 31.

Round 4: Final Week Kick-off

This week, PLR liquidity hit an ATH in the Uniswap V2 Liquidity Pool, surpassing $800 000 in total liquidity. And as we all know, you don’t change a winning team. That’s why for Week 4, the final week of our 30-day Liquidity Mining experiment, the same rules and rewards as Week 3 apply.

This means that the Pillar Foundation has added another 100 000 PLR to a weekly rewards pool. As you may have noticed, we created a native rewards dashboard specifically for our Liquidity Providers. To earn PLR rewards, users must stake their LP tokens on the PLR Rewards Dashboard and remain in the liquidity pool for the entirety of the next week.

Week 1 & 2 were airdropped directly to your wallet, while weeks 3 & 4 will need to be claimed from the dashboard.


Round 1: 9 July 2020 00:00 to 16 July 2020 23:59 UTC

Incentive: 1-to-1 PLR matching to each liquidity provider’s net token outflow.

Rules:

  1.  Liquidity providers (LPs) must be in the liquidity pool at the end of the period.
  2. Each LP’s PLR balance is compared to the amount placed into the pool and any decrease in PLR tokens is the amount of reward tokens that will be given.
  3. Any additions or subtractions to their pool balance will be calculated into their ending balance.
  4. Reward tokens are rounded to the nearest integer.

Funding source: Pillar Foundation: 220,599 PLR

Round 2: 17 July 2020 00:00 to 23 July 2020 23:59 UTC

Incentive: 1-to-1 PLR reward token match to each liquidity provider’s net token outflow.

Rules:

  1. Liquidity providers (LPs) must be in the liquidity pool at the end of the period.
  2. Each LP’s PLR balance is compared from the start to the end of the period and any decrease in PLR tokens is the amount of reward tokens that will be given.
  3. Any additions or subtractions to their pool balance will be calculated into their ending balance.
  4. Reward tokens are rounded to the nearest integer.

Funding source: Pillar Foundation: 100 000 PLR

For the second week of our Liquidity Mining program, the Pillar Community voted to provide funds to match the net outflow in the same way the Pillar Foundation had done in Week 1. In that way, the Community eliminated the risk of impermanent loss for Liquidity Providers.

Because the PLR token price decreased throughout the week, there was no impermanent loss. As such, it wasn’t necessary for the Pillar Community to award PLR to Liquidity Providers.

However, the Pillar Foundation has decided to allocate an additional 100 000 PLR to reward Liquidity Providers in Round 2.


Round 3: 24 July 2020 00:00 - 31 July 2020 23:49 UTC


Incentive: 100 000 PLR weekly rewards pool that is allocated proportionally to Liquidity Providers based on their share in the Liquidity Pool.

Rules:

  1. LPs must stake their LP tokens on the PLR Rewards Dashboard in order to be eligible for rewards.

Funding Source: Pillar Foundation: 100 000 PLR

Starting in Round 3, we wanted to transition to a fixed allocation per week. After much consideration, we realized that issuing rewards based on the change of PLR price (which causes impermanent loss) only rewards LPs as the token price appreciates. Instead, we wanted to ensure LPs were properly rewarded regardless of token price, hence the new structure and the migration to an automated LP dashboard.


Coming Up: 30-Day Liquidity Mining Experiment Recap


Next week, we’ll be sharing a recap of our 30-day Liquidity Mining experiment. We’ll be covering all our learnings, as well as plans for the continuation of our Liquidity Mining program going forward. 

It’s been very obvious that this program has kickstarted a new wave of interest from both new and existing community members. While this first trial was solely for Uniswap V2, we’ll now be looking into other AMMs like Balancer along with different pools and weightings to provide flexibility to LPs of all shapes and sizes.

If you'd like to see the Liquidity Mining experiment continue, please make your voice heard!


While this first experiment was funded entirely by the Foundation, our long term goal is to incubate programs that provide net positive value for the PLR ecosystem. We envision that the Community DAO will take on the role of funding Liquidity Mining at some point in the future, and look forward to working closely with core contributors to help map out the incentives and distribution mechanisms for years to come. 

In the meantime, be sure to stay tuned and join our Discord to discuss everything Liquidity Mining!


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