Tokemak’s revenue decline is correlated with the market crash, and has dropped from $500k per week to $80k-100k per week. Both yield and value of earned assets are down.
The currently deployed liquidity is not at risk, and our focus is on generation of safe revenue for sustainability. Our risk profile is being kept low and the liquidity multiplier is also being kept low given the current market conditions. These guardrails have saved Tokemak a lot of exposure during the market downturn.
Other options for liquidity deployment that may improve revenue are being explored.
Enables locking TOKE and the emission of locked TOKE as rewards.
The priority is that revenue outpaces emissions.
Non-inflationary buybacks will be possible with the ACC model.
Revenue will be distributed via TOKE rather than native reward tokens in order to reduce costs of the compounding process whilst supporting token markets. Otherwise this would be highly costly for users.
Buybacks will be a subset of the accTOKE model.
Buybacks must be supported by revenue.
A TOKE/ETH gauge has been established on Curve.
This increases our governance control on Curve.
Membrane is already being tested by trading desks, and the team is receiving feedback.
A DeFi-centric version without KYC is coming.
Considering that the market conditions are not favorable for a product launch, it has been delayed for a provisional 3 months. Many other projects across the industry are also being delayed.
Alternative L1 & L2 Integrations
A study of Reactor assets that are currently available outside of Ethereum revealed that only TCR and SNX were supported. As a result, the focus is on Tokemak v2 before deploying to additional layers.
There needs to be an overlap in Reactor token presence in alt L1s and L2s. However, their markets currently do not have the demand to support the Reactors.
Inflation of BNT is used to cover impermanent loss.
Some Bancor LPs are no longer protected and are 50% underwater after the protocol suspended impermanent loss protection.
Tokemak always has a protocol reserve and a leverage multiplier which can be run conservatively or aggressively. These are used to deploy liquidity safely, thus protecting against any impermanent loss.
Options & Derivatives
Currently options, futures, and derivatives in DeFi are inefficient and the premiums are expensive.
The team is open to future discussions with the community about implementing our own solution when it's more economically viable.