The Pinwheel Effect on CUB | Growing bHIVE & bHBD Liquidity Leads to Black Hole Theory
We've spent a lot of time lately talking about CUB. There's so much going on under the hood of the CUB Economy and it's amazing to see how it continues to grow month-over-month.
We launched bHIVE and bHBD just a few months ago (August 2022) and since then, we've seen revenue grow 500x. The DAO was capable of buying and burning 1,000 CUB per month prior to the Multi-Token Bridge (bHIVE & bHBD). This 1,000 CUB per month was bought and burned using Kingdoms Management Fees.
Since the launch of bHIVE & bHBD, new forms of revenue have presented themselves:
- Wrapping Fees
- Oracle Staking
- Internal Arbitrage
These forms of revenue have led CUB DAO to 500x its monthly revenue. Now buying and burning 500,000 CUB on a monthly basis.
As the liquidity for bHIVE & bHBD continues to deepen, we're heading toward this pinwheel effect for the CUB economy - also called Escape Velocity.
Basically, Escape Velocity is when more CUB is being bought and burned on a monthly basis than is paid to LPs. Right now we're buying and burning 500k CUB per month and LPs are earning ~800k.
We're more than 60% of the way to our goal. Once we hit that, the pinwheel effect takes hold, CUB's price increases and LP Incentives increase as well. This coincides with less CUB being bought and burned (since its more expensive) but the self-balancing nature of the economy is that LP APY is higher, so more bHIVE and bHBD gets pooled which increases revenue.
We talk about this and more in this clip from the AMA!
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