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WLEO relaunch - Will I join the Liquidity Pool, again?

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rmsadkri
@rmsadkri
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The dearest wrapped leo (wleo) is relaunching. I spent 17 days in total in the Liquidity Pool before removing my liquidity after the hack. I managed to receive the pooled Ethereum but the total of 910 wleo was trapped in Uniswap. I am glad that the original pooled 810 Leo was returned to my Hive account. With that experiment, I did not earn much in terms of Ethereum or Leo but I learned a lot. And, that’s what I am explaining here.

The wrapped leo is relaunching and I now need to answer this simple question, again.

Should I join the Liquidity Pool again?

Well, the short answer is YES I should if I want to experience the joyride I had last month and if I want to brag about it on various social media platforms :P

On the other hand, after the experience I had the answer to join or not to join the pool will depend upon your enthusiasm and efficiency with Ethereum and uniswap infrastructure. Most importantly, I think, the most important variable to consider is the amount of investment you are making while joining the pool.

For example, let’s see what I did last time around. I am not a big investor and I never intended to invest thousands of dollars in the initiative. My involvement was symbolic as I wanted to support #leofinance and @khaleelkazi in their innovation and initiation. And, I also thought that by joining the pool I was adding diversity.

Calculations

My initial investment of WLEO-ETH pair in the Uniswap pool was of USD 221. There were three benefits I received by contributing to the pool.

  1. Fees - Every swap that happened on the platform gave me user fees. I collected 0.81 $ in total.
  2. LP bounty- Leofinance distributed bounties for the LP providers. I received 54 Leo in total.
  3. Price change- this is not a benefit in actuality but the LEO price moved up because of the wleo launch. The total portfolio 15 days after the launch was at around 315 $ which is almost 100$ increase. The total value fluctuates based on ETH and LEO market price.

What’s new this time?

As Leofinance team pointed in an article, the LP bounty program is being replaced by a new distribution model. I quickly looked into the document and entered the same amount of USD investment. If I joined the pool again, I could enjoy 42% APR if I remain in the pool for 120 days.

Apart from this new distribution model, you could receive the other two benefits I mentioned above. You could still collect transaction fees and enjoy the (potential) upward price action of wLEO.

After reliving my experience again, I decided that I would not be joining the pool this time around. There are two main reasons.

  1. Not being emotional - I think my decision to join the LP pool during the first launch was emotional. I was trying to provide moral support from my side.

  2. Gas fees - If I am making 200$ investment then the gas fees would eat up almost 10% of my investment. It makes sense to invest more than 1000$ and not worry about the 20$ gas fees.

With this post, I am not discouraging others. I am simply putting the facts based on my involvement. I still support the relaunch but I will be writing, reading, commenting and upvoting with the Leopower I have. And, who knows I will change my heart and be emotional about LeoFinance and join the bandwagon, again.

Posted Using LeoFinance Beta