Geyser versus LeoBounties - Is the LP Really Worth It?

in LeoFinance3 years ago (edited)

It is a cool and rainy Sunday, and it feels good to snuggle into a blanket, sip on my coffee, and take a look how my money is doing. I feel there is some type of reckoning on the way, as I have been looking at past data, calculating averages, and weighing all possibilities. Though I haven't reached a formal decision yet, I am pretty sure to get there within a week. For now, I feel like sharing my thoughts here, hoping for either a No man, don do it! in the comments, or a Go ahead man, I'd do the same thing. Not that it would make me change my mind, but I always appreciate some perspective.


image source

Looking Back at Geyser After Six Months +

At the end of last year I was pretty excited to get my feet wet with the brand new DeFi opportunity LeoFinance brought out: the famous WLEO-ETH liquidity pool. After losing everything in the infamous hack, but being reimbursed by the LeoFinance team, I got even more excited to join the pool, and I entered it with 2.07 ETH and a matching amount of 4819 WLEO. It was amazing to see that each month the LP rewards, called Geyser, kept increasing gradually. Of course, at the time the price of LEO was also climbing steadily, approaching a dollar in value in April.

Even now, that the price of LEO came back down again, together with BTC, HIVE, and most alts, it's still nice to see a Geyser reward of good 150-200 LEO a month. Or is it??? A closer look at APY Vision makes my impermanent loss abundantly clear: My initial investment of 2.07 ETH has dwindled down to 1.71. In other words, my participation in this pool has made me lose an entire ETH!!! Granted, I now have 9511 WLEO, and I this is a risk I was well aware of. Still, it makes me feel less enthusiastic about the whole thing. Had I just kept my ETH in my wallet, I would be worth a grand more.

image.png

Don't Ignore Cub Finance!

Since I'm looking at the balance scales, I should also include Cub Finance here. After all, I got a nice fat airdrop of CUB (okay, back then it actually felt pretty fat) for my holdings of LEO and WLEO. Plus, each Geyser payout I received I kept investing into Cub Finance, either buying BUSD or BNB, or directly CUB, when I thought the $3.00 price was cheap. After investing, harvesting, compounding like this for a few months, my holdings in the farms and dens on Cub Finance are worth $546. (I'm not counting the $442 of BTCB, as that came from another source.)

image.png

Don't get me wrong here, I'm not regretting having entered either the Uniswap pool, or Cub Finance. At this moment I'm just contemplating how to proceed. Should I stay or should I go? And in either case, which way?

CUB for Sure. But Is The WLEO-ETH Pool Really Worth Being In?

After a (relatively) long time, CUB has finally started to move upwards a bit. I know, ten cents are not much, but when was the last time this has happened? Since the gradual release of Kingdoms, it seems like good things are happening here, so I expect CUB to do well... In any case, I'm not thinking about leaving. However, there is a good chance I will reorganize my funds, making use of the BNB-BUSD kingdom. That also means, I'll leave those respective farms, freeing up 186 CUBs, which I'll dump in the den until the CUB kingdom arrives.

But what about the WLEO-ETH pool on Uniswap? Can I expect WLEO to rise up again so people will want to swap my WLEOs back to ETH, making my loss actually impermanent? I'm not so sure. On the other hand, the same trend may just as well continue, and my last remaining ETH could keep melting away. And all for what? A monthly Geyser reward of 150 LEO? Couldn't I make that much elsewhere?

Leo Bounties: Reward for Delegating HP to Leo.Voter

As it turns out, there is a really nice and lucrative way to get a similar return, without even having to leave the HIVE ecosystem. It's very simple: by delegating HivePower to @leo.voter you get a daily Leo Bounties reward. At the moment, for a delegation of 1053 HP I'm getting an average of 0.56 LEO a day, calculated over the last 30 days. In comparison, my average Geyser reward, calculated since January 1st, is 4.44 LEO a day.

So let's just assume I leave the WLEO-ETH pool completely, put my remaining ETH back into my wallet, and turn my WLEO into LEO, then HIVE, then HP, and increase my delegation to @leo.voter by a tenfold. I would still get a comparable amount in Leo Bounties every month as I now get in Geyser, but I wouldn't have to worry about my ETH melting away, and in fact could invest it elsewhere. Best of all, I can always undelegate / power down my HP when I get tired of this. Meanwhile my funds will always remain under my control. Whereas now... I'm just realizing that I still have to figure out how to exit the pool!


image source

Impermanent Loss on CubFinance

Though as I said, I'm still pretty comfortable on Cub Finance, I can't ignore a similar impermanent loss as I've seen with ETH. Of course on the Binance Smart Chain it's BNB that keeps melting away. I remember having had more than one at some point, which by now is down to about 0.4 BNB. Since this is the currency I have to pay all my transactions in, I'm particularly not happy about this. But once again, it's a risk that I knowingly took, so I can't have a word of complaint.


image source

The way I understand from post like this one, with Kingdoms I can prevent further loss. If I put my BNB into its Kindom where it's paired with BUSD (of which I happen to have a matching amount), in addition to earning some rewards in CUB, I'll be able to see a gradual increase in both BUSD and BNB. And that seems quite desirable! Sure, I'll have to completely rearrange my holdings, freeing up my bLEO currently paired with BNB in the farm, but all that can still be converted into BNB... or even CAKE. Why not?

One More Week to Mull Over Everything

Not being a fan of hasty decisions, I have decided to let these ideas ferment a little. On Wednesday we should get the next Geyser reward (though judging from the past months, chances are it'll arrive late - one more reason against it). And on Sunday, while compounding my earned CUBs, I'll be also ready to make these greater changes. Until then, I'll be happy to see all kinds of comments, suggestions, and advice of any kind. Are there any good reasons to stick with Geyser that I haven't considered? I'll appreciate any input.

Leo Finance.png

Posted Using LeoFinance Beta

Sort:  

Interesting stats here...I've not been quite as adventurous as you, but I'm in the Cubdefi as well. I should have sold I should have bought, can crypto people ever free of this plague?

Right now, I'm not really concerned about the funds I have on different platform, with the way they have performed or are performing I want to zero my mind from them.

Right now I'm more concerned about putting some stables together so I can survive the bear period in case that's where we are.

To answer your question, if ETH starts to go up and Wleo starts to follow, will you be able to make back the amount you lost to impermanent loss?

Posted Using LeoFinance Beta

Not so sure about this.... If ETH starts going up, that would not necessarily pull WLEO up with it. At least, it hasn't happened in the past. In fact, that is what I believe caused my impermanent loss in the first place: Sure, people could spend their WLEO in exchange for my highly priced ETH, so it was quite understandable. On the other hand, it was when LEO was going up that WLEO rose in value. So honestly, I don't really see much of a chance to get back my lost ETH simply by staying in the pool.

So the only way you can make profit back is if Leo starts to pump....thats tight

Posted Using LeoFinance Beta

Well, I'm still in the plus, thanks to market gains. But like I said, I would have gotten that anyway, even by just holding the ETH in my wallet.

Your content has been voted as a part of Encouragement program. Keep up the good work!

Use Ecency daily to boost your growth on platform!

Support Ecency
Vote for Proposal
Delegate HP and earn more

This is a very interesting dilemma, because I too have experienced these impermanent losses, and it bothers me also. I was heavily invested in the Cub-BUSD pool and I lost quite a bit of BUSD. Additionally I am heavily invested in BLEO-BNB, where I have lost quite a bit of BNB, and on top of that I have lost quite a bit investing in Cub, as it’s value has gone down quite a bit. I feel like I feel your pain, and I understand why you are at this decision point. Oddly enough I was contemplating using my ETH and entering the WLEO-Eth pool LOL 😂...talk about out of the frying pan and into the fire! LOL

However, I have accumulated quite a bit of Cub, and BLEO, so longterm I could be very profitable, despite the apparent short term losses, as the Total Value locked of my investments is currently down, but it’s potential total value is very high should it rise as I have placed most of it in Cub Kingdom.

My perspective is that longterm the value of Cub and the all the versions of Leo will rise. I think Leobridge has good longterm potential, and Cubfinance will continue to evolve and become more stable in terms of value and sustained profitability.

At the beginning of Cubfinance, I unstaked over half, of my Leo, and invested my Leo in Cubfinance. So I also understand what your saying about giving up consistent daily profits on curation on Leofinance, if I had kept my money there. But I also would not have the potential to multiple my gains like Cubfinance has provided, and I would not have the invaluable experience and understanding of DeFi, cross blockchain trading, token wrapping and smart contracts that Cubfinance has taught me. And that is priceless.

I think this is truly the road to knowledge and riches we hear about in cryptocurrency, and many romanticize. But those who travel it, know it’s a journey characterized by both pain and pleasure, with no guarantee of the ultimate goal; financial independence. But the goal is worth it, and so we travel the road, it’s small gulches and big valleys, traverse the little streams and big rivers, climb the small hills and big mountains. All in search of the ultimate goal, Hodling and trading our way to the prize.

We are Leofinance Lions, we are learners, we are teachers, we are those who are in between, who both teach and learn. We are in this both together and by ourselves. It is a not a lonely journey, but each of us alone must deal with our individual reactions to stress and tolerance for risk and paper losses. Each of us must choose our path and ultimately take responsibility for our investment decisions.

As they say amongst the Mandalorians, that is the way.

Posted Using LeoFinance Beta

Awesome, @shortsegments! This long comment of yours got me feeling great about LEO, CUB, and even HIVE. Not that I was doubting them in the first place, but getting my views reaffirmed is worth gold, especially on a day like this!

It's true about the impermanent loss: it only affects one side adversely. Thus I have close to 10K of WLEO, so I should not complain. (Okay, the value of it has also gone down substantially, so I'd be much worse of if I changed it into USD or some other fiat. But I wouldn't be much of a lion doing that, right? Besides, I'm sure its price will come up again eventually, and until then I can make good use of it by curating / delegating.)

I agree 100% on your point about learning. If you put your mind to it, if you stick to it consistently, all your losses will be totally worthwhile compared to the skills you acquire. For this reason I don't want to dissuade you from joining the ETH-WLEO pool on Uniswap. As for me, I think I'll look for a better place to put my ETH. Maybe in the ETH-BNB kingdom on Cub Finance? Though before I do that, I want to reorganize my BUSD and BNB from farms into kingdoms. Oh, I totally hear you. The same losses you've mentioned have affected me too: I used to have way more BUSD and BNB than now. :-( Time to do something about that! Thank you kingdoms!