HBD Pool On Polycub

taskmaster4450le (81)in LeoFinance • 4 years ago

To me, this is one of the most exciting developments, both for Polycub and Hive. It was good to see Khal talking about it on the most recent video. The team put up a post detailing some of the ideas concerning HBD and Polycub.

The Hive Backed Dollar (HBD) has the chance to be a game changer for Hive. We are seeing more threats of regulation coming from all over the world. The key is to develop stuff whereby we do not care what regulators do.

HBD is exactly that.

Of course, it is difficult to make any progress if we are looking at something with very little liquidity. For that reason, I started pushing the idea of the Hive Savings Bond a few months back. Hopefully we are starting to make some headway, with people understanding the importance.

Having a platform like Polycub picking up the ball regarding HBD and running with it is another step forward. This is going to solve some major issues.

Source

Bridging Hive

In many ways, Hive operates like it is an island unto itself. This is not a good thing when it comes to onboarding. Leaving the users accounts aside, it is tough for many to get money onto Hive. Depending upon where you are, like in the US, Coinbase does not carry either Hive or HBD. Hence, we have to go through something else.

Leofinance is already setting up different pools on multiple chains. For this reason, they are adept at bridging. The LEO bridge allows people to access wLEO, bLEO, and now pLEO.

Bringing this function to HBD is a huge boost to Hive. Keep in mind that LEO is on Hive-Engine. To get to Hive requires another step.

With HBD, this will end up right on Hive. Someone will be able to go from Polygon directly into Hive using the HBD bridge.

This will open up the door for many people to access this blockchain.

Builders Believe

Khal is a builder. There is little doubt about that considering what he is doing with the Leofinance family of applications. Here we see his views about the potential of HBD:

As Hive users I think we all believe that HBD - Hive-Backed Dollars - is one of the most superior algorithmic stablecoins that is out there.

The biggest problem up to this point is getting a serious amount of HBD. If Hive Savings Bonds are implemented, it is going to be a challenge for people to get HBD, especially if they are outside the Hive ecosystem.

A liquidity pool on Polygon can help to alleviate this.

Here are some of the details:

We're building our own version of a wrapped HBD token that we're preparing to launch on the Polygon network. This will rely on an oracle which can be seen as its main weakness however it will also be the deepest liquidity pool that HBD has ever seen.

The bold is my emphasis. This is crucial for people to understand.

Polycub is seeking to have the deepest liquidity pool HBD as ever seen. Granted, up to this point, that is not very deep. Nevertheless, this shows the intention.

Quite frankly, the goal here should be to get millions of HBD in the pool. This is going to require getting a hold of a decent portion of the liquid HBD that is out there (only about 10 million HBD). It is also going to need people staking on-chain to keep producing more of it. Finally, there is going to have to be a fair bit of Hive converted to HBD.

Naturally, all this is positive for both tokens.

Making Polycub Unique

When we look at the LPs on Polycub, nothing truly stands. There is the wETH-wBTC pool. How many of them exist. Of course, the pLEO-MATIC is vital to the Leofinance ecosystem. However, that is still a bit limited in desire.

HBD takes things to another level. As cited above, the potential for this token in light of the regulatory environment is incredible. It is a community driven, base layer, decentralized stablecoin. That is huge in this environment.

And here is where Polycub can be unique: it can have the largest LP for HBD anywhere. If this token can take off like many of us believe, this could really generate a great deal of activity.

This is what is required on Polycub.

POLYCUB benefits by accruing vault fees + interest on HBD

Hive benefits by getting a super-deep liquidity pool for HBD

Consider the point of a deep HBD pool. If the upcoming features like Bonding are applied, the protocol will have a piece of the pool. There are going to be a lot of fees generated if the activity is there. This means that we can see the protocol garnering a lot of money which to buy POLYCUB.

At the same time, there is the 12% interest for having HBD in savings. Let us use 1 million HBD in the LP. Perhaps there has to be a 20% buffer kept liquid for people moving out of the pool. That gives us 800K HBD in savings.

When using that, at 12%, we get 96K HBD that is generated in a year. Of course, have a pool of 4-5 million HBD and we can see how the numbers can jump greatly.

Why would people put HBD in there? Obviously it will have to offer a greater return than what is available on-chain. It could get very interesting if the witnesses decide to raise the interest on HBD.

The bottom line, to be a viable stablecoin and a player in the market, billions of HBD will be required. For Polycub to have a deep liquidity pool, it is going to require tens of millions of HBD. This simply does not exist at this point.

For that reason, this can push Hive to much greater heights. We are going to see a great deal of pressure entering if other use cases develop for the token.

This is one liquidity pool that could set Polycub apart from everything else. If HBD can start to generate a significant return for people, this is going to have a domino effect throughout Hive.

Just this alone will create not only a use case for HBD but also a need. More will have to be created.

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