March 18th, 2022
1. Introduction
At the time of writing, we are approaching the conclusion of the Treasury Bootstrapping Event of Lydian. We expect that the Auction’s Tokens will be sold out sooner than the predetermined runtime, causing all tokens to be issued to those who have participated.
As the end nears, we might also see the gap between Auction Price and Token Price close much faster than expected, so waiting too long to participate could result in you missing out on the first LDN tokens and the early benefits that accompany them! So make sure that you enter in the Auction on time.
With the end of the event in sight, it is time to present you with the next steps in bringing the Farmers Guild to life.
In this article we will describe some specifics about the end of the Dutch Auction and Lydian’s transition to Protocol operations. Let’s dive right in!
2. Auction’s end
The Treasury Bootstrapping Event was officially opened on the 15th of March at Stacks block number 52390. The auction event will end on block 52966, which was originally estimated to be roughly four days later. It seems this prediction was not too far off as the actual runtime will probably be around four and a half days.
At the time of writing it is clear that the Auction has raised significantly more than what was needed to start. Consequently, there will be a very potent and stable treasury to start off with. This treasury will actively be put to use to the benefit of all Lydians. In order to express our gratitude towards all of our early Guild Members, the next step of Lydian will grant a very rewarding opportunity.
Note: the ending of the event on block 52966 does not determine how much time there is left to commit USDA to get LDN. As soon as the linearly dropping Auction Price equals the Token Price, all tokens have been divided and it will no longer be possible to participate in the auction.
After the conclusion of the event takes place on block 52966, people who have participated in the event will be able to claim their very first LDN tokens. We are all very keen to put these tokens to use! So let’s take a look at what’s next.
3. Bonds before Stakes
Contrary to the initial plan, the first Bond will be enabled before it will possible to stake your tokens. The next week will be the Liquidity and Bonding Utility Week. Multiple arguments can be made for this approach. How about we take a look at some of the more important ones?
The principal argument is that the most rewarding early opportunity should be made available for the first supporters of Lydian, those who’ve participated in the Treasury Bootstrapping Event. There are two great benefits here: first being the exceptional Bond discounts (more on that later) and the fact that Swapping will not be enabled yet, granting certainty of token value for these transactions.
Secondly, now that the stable treasury has been built, the healthiest next step would be to garner Protocol-Owned-Liquidity, which is one of the cornerstones of Lydian’s protocol operations.
Lastly, it makes more sense to enable Staking as soon as it is possible to Swap LDN tokens in a Liquidity Pool, seeing as these mechanics might impact the LDN token price that was established by the Dutch Auction.
4. Coordination with Arkadiko
Before we go over to the excellent news, let’s start off with the fantastic news: Arkadiko DAO has approved to list Lydian’s LDN in a Liquidity Pool on Arkadiko Swap in a landslide vote. This is a major milestone since Lydian relies on the Liquidity Pool capacities of Arkadiko Swap for our first Bonds.
In order to make the necessary arrangements, a close coordination with the Core Contributors and DAO of Arkadiko is important. The timing of our collaborative mechanics has to make sense. This becomes apparent when we look at the timeline we have agreed on:
- Arkadiko adds wLDN-USDA to Arkadiko Swap. (and airdrops wLDN to its members)
- Lydian opens its very first Bonds.
- When the Bonds limit has reached or after a predetermined period of 5 days, staking of LDN is enabled.
Important: it is highly likely that the Bonds will be depleted sooner than the period of 5 days, causing the functionalities of Staking and Swapping to be enabled sooner. - As soon as Staking of LDN is enabled, Arkadiko will enable the Swapping functionality within the wLDN-USDA Liquidity Pool on Arkadiko Swap.
5. Bonding parameters
Now for the most interesting part, the parameters for these very first Bonds:
- This first bonding will have a max. runtime of 5 days.
- The max. token amount available for these bonds is 7,600 LDN.
- There will be a maximum limit of ~770 LDN per Bond.
- Vesting will be exceptionally short, lasting only 144 blocks — roughly one day.
- The starting discount will be set to 14% and will uniquely scale down very slowly, so there will always be an ample discount to be had.
It is highly likely that the Bonds will be depleted sooner than the period of 5 days, so make sure you do not miss out!
The functionalities of Staking and Swapping will be enabled as soon as the Bonds are depleted.
The parameters described above have been exclusively put together for this very first Bond. These parameters provide the first Guild Members with a one-of-a-kind opportunity, as bonders will have a chance to grab their discounted tokens before swapping and staking is enabled.
Secondly, the amount of tokens reserved for these first Bonds is specifically determined to garner a minimum value of 400,000 USDA of liquidity. This will greatly benefit future protocol and price stability, ultimately benefitting all Members’ ability to move assets and benefit from the protocol’s operations.
6. What happens after Liquidity and Bonding Utility Week?
Lydian is ready to become an invaluable and active DeFi component in the Stacks ecosystem, therefore new Bonds will continually be added.
Likely token candidates for LP for the next Bonds will enable Lydian to start expanding and deploying its Yield Farming Strategies further across the ecosystem.
We are very excited to hear your feedback to this article. As always, the Lydian Discord is a great place to ask questions or to engage in an open discussion with other Guild Members.
