The unique Advantages of Liquidity Generation Events
Currently CORE is hosting its second Liquidity Generation Event which creates a unique price for contributors. Understanding the difference between minting LP tokens through the LGE compared to after, gives insight to a specific opportunity.
The First Liquidity Addition ♟️
The price of LP tokens is even for all contributors during the liquidity event. After the LGE is over, the price of LP tokens rises on each new mint, creating additional incentives to participate in the LGE. Due to these mechanics and observations of previous performances, the price of LP tokens after the event is almost guaranteed to be higher in the secondary market. However, past performance is not indicative of future results. The more LGE’s are created, the more data about LP prices before and after will surface, clarifying this price action.
Triangular Arbitrage 📐
In the case of CORE’s ecosystem, triangular arbitrage is forced. This means that our pool dictates a certain price for CORE/wBTC. If this price changes, from outside market forces, it creates an opportunity to make profits with minimal risk. While traders profit from triangular arbitrage, LP token holders will receive the transfer fee charged for every trade made with CORE.
The Web of Pools 🕸️
The foundation of CORE’s ecosystem lies with its liquidity pools. Every liquidity pool relates to one another. For each new additional liquidity pool created through our Liquidity Generation Events, the collective of pools becomes stronger. Through a mechanism called “Ripple Effect”.
Arbitrage between liquidity pools causes a ripple effect which will travel through each existing pool in our ecosystem. This means that if one pool changes the price for CORE or any other asset, it must be matched by the other pools. Resulting in an increase of volume.
You can see this effect compounding for Ethereum, that is why ETH has so much volume on Uniswap.
CORE will challenge exactly that while having fees on transfers to profit LP holders.
wBTC or ETH contributions are guaranteed! 🔔
While the Liquidity Generation Event contract accepts a multitude of tokens, it has a special relationship with CORE.
CORE is never sold by the LGE contract. If there is an oversupply of CORE which would lead to a mismatch in the peg, the smart contract will refund the excess at the end of the LGE.
The peg is created by taking account of the common pair of wBTC/ETH & CORE/ETH.
wBTC and ETH allocations are guaranteed to give you LP tokens for the whole amount contributed while in case of an excess of CORE, it would result in a percentage of the allocation being refunded.
An unstoppable Force ⚙️
Each trade performed on a Uniswap pool is charged with a 0.3% fee, paid to LP holders. In the case of CORE’s pools, this fee is assigned to LP tokens which grow the liquidity pool. Because all CORE liquidity pools are locked, this mechanism will grow and multiply the liquidity indefinitely.
A constant rising price floor and the volatility from other coins, reinforces arbitrage and generates more volume. Even if no liquidity is added from the outside, the pool and the APY will still grow.
CORE equivalent units explained 🧮
The LGE smart contract counts each contribution of a token in CORE Equivalent Units.
This means that an allocation is calculated as how much CORE it would buy at the moment of contribution. This system creates opportunities of increased buying power for all tokens except CORE, during CORE dips.
Beyond pools, the future of Vaults 💱
CORE collecting priceless data from its liquidity pools which will be used to calculate investment risks for CORE Vaults. Every pair of the LGE is wrapped in a special ERC95 token, gathering accurate reports on volume and other important statistics to the CORE transfer handler which compiles following stats:
- Price Floor
- Volume
- Volatility
- Average Price Over Time
- Adjusted Average Price over Time — Volatility — Volume
A strong Governance 🗳️
Our staked LP token holders get a vote on future development as well as smart contract changes. We are expecting CORE Governance to be the strongest in the DeFi space. Our governance encourages both short- and long-term perspective. LP tokens being locked forever creates a longstanding relationship with the project while obtaining daily rewards from staked LP tokens animates decisions on lower time frames as well.
💬 Join Us!
- Join the discussion in our Discord at https://discord.gg/hPUm9Jh & Telegram https://t.me/COREVault
- Don’t miss any update by following these Twitter accounts at @CORE_VAULT @x3devships @0xdec4f @0xRevert
