The past 7 days have been ridiculously busy for LeoStrategy. We've successfully launched LSTR and SURGE on Cross-Chain (Base Blockchain. Launching LSTR & SURGE to the world of cross-chain has been a great journey and we've built a lot of technology to make this infrastructure possible and also make the economics sustainable.
In this post, we'll talk about something that you probably didn't see coming: how we're fueling triple digit APR yields inside the LEO/LSTR/SURGE liquidity pools.
Be careful: if you read this post, you may be inclined to provide liquidity as fast as humanely possible. Don't trip over yourself as you try to get capital onto Base and start farming 300%+ yields.
The Big Picture
intentionally keep spreads tight → favor LPs → bootstrap liquidity → scale profit
LeoStrategy is a permanent-capital vehicle that acquires LEO on the open market and adds it to our perma-stake balance sheet as sLEO on LeoDex. This LEO serves as pristine collateral to tokenize assets and deliver derivative markets for the cross-chain world. LEO backs everything and LEO also benefits from the growth of the system: 100% of our profits fuel additional LEO buybacks which leads to an ever-growing collateral base for existing + future derivative products.
To succeed in this mission, LeoStrategy prioritizes staying lean and being hyper-profitable. Our Market Makers are the core engine of this profitability.
There are 4 LeoStrategy Market Makers and all of them are live as of today:
- LEO Cross-Chain MM
- LSTR Cross-Chain MM
- SURGE Cross-Chain MM
- HE Internal MM
All 4 of these market makers are already profitable and collectively are making over 100+ trades per day. Each trade leads to a material profit for the LeoStrategy fund.
In these early days, we are emphasizing tight spreads across all markets. Our intention is to keep spreads tight which actually favors Liquidity Providers. LPs are the lifeblood of liquidity and if we are to bootstrap liquid and active markets, we must ensure that LPs are enticed to add additional liquidity to their positions.
Why Tight Spreads Matter
LPs in the following 3 pools are paid entirely from Swap Fees:
- LEO:USDC
- LSTR:ETH
- SURGE:USDC
These 3 pools all have the same setup: they are on Uniswap V4 and they have a 1% Swap Fee.
This means that for every $100 traded in the pool, $1 is earned by Liquidity Providers (LPs).
By keeping spreads tight, we encourage more trading volume while creating pair volatility and trading volume organically with our arbitrage bots.
Since all 3 cross-chain MMs are operating inside these pools and all pools are linked by having a LEO foundation on Hive-Engine, volatility in one pool leads to volatility in all pools.
LPs Are the Engine of Market Growth
Liquidity Providers are first-class citizens and we must treat them as such. The more volume we can spur in the pools, the higher the yield is for LPs. This leads to not only existing Lions adding more liquidity, it also leads to external attention.
There are millions of yield farmers in the world who literally do yield farming for a living. All they do is search for high yield liquidity pools and algorithmically decide which pools to farm for the best returns.
Attracting them means attracting two types of people:
- Traders
- LPs
Traders naturally float to liquid assets that have high relative trading volume (relative trading volume vs depth in the pool). LPs naturally float to these pools too because they see juicy APRs and want a slice of it.
The best marketing is success. Growing LeoStrategy and the entire LEO Economy is contingent on growing the userbase while attracting capital, traders and LPs. Success is the best marketing strategy. By growing the APRs in these pools early, we attract a lot of attention.
The Long Game
Everyone Benefits:
- Traders: low slippage, active markets
- LPs: high early APR + sustainable long-term fees
- Market makers: long-term profit scaling as spreads widen
- Ecosystem: deeper anchor pools and more stable pricing
LeoStrategy intends to grow the LEO Economy and the attention on our derivatives by:
- Growing APRs in the liquidity pools organically (by keeping tight spreads, we encourage more trading + naturally add volume through our market makers being more active)
- Listing LEO, LSTR and SURGE Liquidity Pools on DeFiLLama Yield and other platforms that yield farmers use to find pools to farm
- Listing LEO, LSTR and SURGE pairs on other DeFi platforms and encouraging more people to actively trade them
Remember: volatility = vitality.
LPs bring market depth so that traders can confidently trade through pools. It's a natural chicken & egg problem but LeoStrategy's market makers solve this problem by organically pumping volume through tight spread management between Hive-Engine and Base.
How to Farm 356.81% APR
So you're ready to farm 356.81% APR in the LEO, LSTR and SURGE Liquidity Pools?
All you need to do is go to the pool pages and determine which (or all) of the pools you want to put some liquidity to work in. Since these are Concentrated Liquidity Pools (CLPs), you can choose to provide either 50/50 liquidity across the whole price spectrum OR, you can choose price bands to provide liquidity more efficiently.
We recommend picking some price bands that you're confident LEO/LSTR/SURGE will trade inside of. This makes your liquidity more efficient and therefore, increases the APR Yield you farm.
- LEO:USDC ->https://app.uniswap.org/explore/pools/arbitrum/0x43d39ac342f202b57e4949ee8a48695b06338809e77ec5a62c198bfa657ae4b7
- LSTR:ETH -> https://app.uniswap.org/explore/pools/base/0x8ff8effa2071653e0733797d3d6298491c6cfca59dae7fa4092b77fcdccc7798
- SURGE:USDC -> https://app.uniswap.org/explore/pools/base/0x796f3ddcd4b61760dca709a2310197fc56aa77300d37c5740aa2cdab2781ece8
Once you go to any of these pool pages, connect your wallet to Uniswap and click "Add Liquidity" in the top right.
If you don't already have LEO (Arbitrum), LSTR (Base) or SURGE (Base), you'll need to get those assets along with the other asset (USDC or ETH) to pool with on Base or Arbitrum.
Use https://leodex.io as a tool to swap for these assets! You can also use LSTR & SURGE Oracles to unwrap heLSTR or heSURGE to Base LSTR or Base SURGE.
Questions?
If you run into any trouble, drop a question below and we'll help! You can also drop questions directly on https://inleo.io threads and the Lions will help you
Happy farming 🦁
Posted Using INLEO
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