Co-authored by: @vandynathan @SkirmantasJ @dragos

Summary

RADAR has traded within the range of $0.006-$0.01 over the last twelve months and maintained liquidity levels on SushiSwap around $1M. Considering the current market conditions, additional large RADAR holders joining the DAO through DappLaunch, and our ongoing focus on liquidity and on-chain transactions on scaling solutions such as Polygon, this proposal suggests:

Maintaining the APR on SushiSwap V2 ETH/RADAR pool, providing 120,889 RADAR per day, totaling 10,879,983 RADAR over three months. Continuously reviewing the feasibility of transitioning from V2 to V3 and/or utilizing protocol-owned liquidity on Ethereum.

Motivation

The proposal aims to balance enhancing RADAR’s liquidity and addressing liquidity incentivization challenges, including impermanent loss risks to Liquidity Providers (LPs). By refining the reward structure on SushiSwap V2, we aim to sustain attractive APRs for LPs, supporting RADAR’s price stability and mitigating inflationary pressures on RADAR. Analyzing the DEX trades, Sushi is still leading in terms of transaction size, therefore, maintaining stable liquidity levels is important for large trades that are not efficient on the other chains.

Abstract

Introduction

A careful redistribution of rewards to ensure sustained support for RADAR’s liquidity on Ethereum without jeopardizing our current liquidity depth and RADAR price. stability. With new large RADAR holders joining the community through DappLaunch and other proposals, this strategic adjustment is timely and essential.

The 3 month period is short enough to allow us to react to the market dynamics, given the recent market movements, but also long enough to not become a governance and management burden.

Optimization of RADAR Liquidity Incentives

Balancing the costs of liquidity with liquidity growth is crucial for our token and product growth. Considering the technical and liquidity fragmentation risks of new pool launches, we propose maintaining our stance on SushiSwap V2 with the current APR rewards.

Future Liquidity Improvements

To further strengthen our Ethereum liquidity, the Tokenomics Workstream will continue to review the feasibility of moving from V2 to V3 and/or utilizing protocol-owned liquidity on Ethereum when market conditions improve and liquidity is consolidated on other L2 chains.

We invite the community for feedback and engagement before the proposal’s execution.