SushSwap bang on the promise of deprecated rewards for those who had actually begun to market before the automated market maker (AMM): 1,000 sushi tokens per block for liquidity providers (LPs) who committed before going live.
It was a good enough deal to lure various crypto assets worth around $ 1.6 billion, but now the top days of those rewarding days are over. Each block has fallen to 100 SUSHI as reward, as planned. 23:10 UTC or Itherem Block 10850000.
Now that Sushiwa is serving less SUSHI, no one has any idea what will happen to the stack of cryptos locked in Sushiwap’s smart contracts.
SushiSwap successfully migrated over $ 800 million in crypto assets on rival automated market maker (AMM) Uniswap Sept 9, assigning Unstwap tokens to the upstart project by users seeking those SishHI block rewards.
Read more: SushiSwap will withdraw $ 830M from deletion today: Why it matters to DeFi
According to the site’s community-built Block Explorer, Liquidity at SushiSpive currently holds $ 1.46 billion in crypto assets. Meanwhile, according to DeFi Pulse, Uniswap has $ 539 million.
SUSHI is currently trading at $ 2.45 as a bonus expiration, according to CoinGcko, which is at its seven-day high of $ 3.17.
All about yield
Crypto denizens want to change the world, of course, but what they really want is money.
Giving a new token to compete with market leaders has become a clear way for the new protocol. Liquidity mining yield is a category of yield where liquidity providers (LP) earn an additional token beyond whatever fees they earn from the underlying protocol. The growth hack was pioneered by Defy Lending Platform Compound in June, followed by its COMP governance regime that ceased cascading innovations in the following months.
In this example, both Uniswap and SushiSwap hang up to 0.3% of each transaction in their pool, which is expressed in tokens in the pool. But SushSwap also distributes a fixed amount of SUSHI to its LP in every block. (Uniswap has not yet offered such a plan but it is widely expected among DIFI insiders.)
Read more: What is the yield? Daffy’s rocket fuel, explained
Before blocking 10850000, each SushiSwap LP received SUSHI in proportion to the liquidity supplied.
So, if Sushiwap has only 100 LPs and they all put the same amount of liquidity, they will get 10 SUSHI in each block. If this number increases by an equal amount to 1,000 LP, they will only get 1 SUSHI.
More LP yields in less mined tokens, but it also probably increases the value of the token. What is the optimal balance? It is difficult to say.
With SUSHI distribution now dropping by 100 per block, this question is going to be on every SushSwapper’s mind.
Will the liquidity come out of the sushi back or will it actually flood? An argument can also be made.
Sushiwaz’s community wants to refine the block awards more, but they have been stunned so far.
The project’s pseudonymous (and controversial) creator, Chef Nomi, clearly had a vision that Sushiwapas’ tokens would remain relatively stable, and the main governance question for the community would be how to add the new pools.
The SUSHI community wants fine control, however, and that may be ill-suited to the low-governance model currently in the works.
Read more: Yearn, YAM and Rise of Crypto’s ‘Strange DeFi’ Moment
The new leadership of SushiSwap – a board of nine people selected by the community on 9 September – published a new blog post on Saturday about the grand opening of the project and its immediate agenda.
The post, at least in English, states:
“Being a thorn where we only have the recipe to mimic, it’s not enough for everyone to succeed and move on. We know that we are new to our LP – traders and sushi holders with new features and compelling tools Wouldn’t be the best DEX. “