More liquidity at Poloniex?

[JordanLee]

I have noticed that recently Poloniex has brought us the vast majority of our trading volume. 83% of trading in the last 24 hours occurred on Poloniex while we only placed 16% of our tier 1 liquidity on Poloniex. The liquidity we have there doesn’t gracefully support the volume of trading happening there. My guess is we would see an increase of volume at Poloniex if we increased the liquidity there.

What is the best way to bring liquidity there? Can we increase the incentives at Poloniex or decrease incentives (rates paid by pools) at other exchanges?

It’s an issue that I expect will come up repeatedly, so a solution that can be applied sustainably would be best. However, there are a number of people here that know more about liquidity operations than I do, so I would like to hear from such persons about how we can alter liquidity operations to allow shifting funds where they are needed.

NuBits is now frequently in the top 10 on coinmarketcap.com by trading volume. Congrats and thanks to everyone that helped make that happen. Let’s see what we can do to get even more volume.

[Nagalim]

Aren’t we like 100% at target on Nu-Pool all the time? Couldn’t we just increase the target?

[JordanLee]

Aren’t we like 100% at target on Nu-Pool all the time? Couldn’t we just increase the target?

Would a motion that increased the target at Poloniex while decreasing the target elsewhere to cap total liquidity costs make the most sense?

[Nagalim]

I think we can afford to pay for more liquidity. We should do this in the individual pool grants this month, they will be coming up in the next week or so.

At one point you said we can afford 10 kNBT/month for liquidity operations, but we only spend ~8k. NuLagoon takes 5k, LiquidBits takes 1k, NuPond takes 1k, nu-pool could take 3k instead of the 1k it’s been taking. If we are trying to get extra pools on cryptsy, however, we will have to reconsider this. NuLagoon is clearly the biggest expense, but that also operates on polo.

We could lower rates in order to raise targets. As we are 100% on Nu-pool all the time, that might be a good strategy.

[JordanLee]

NuLagoon is clearly the biggest expense, but that also operates on polo.

I’m not confident we are getting the same value from NuLagoon as the other pools, although its architecture is something we very much need and is complimentary to the other pools that operate. @henry would NuLagoon be able to help us out at Poloniex? I’m also hoping to see NuLagoon establish principles about when to move funds between tiers based on current liquidity wall ratios.

[Nagalim]

Pool operator fees as a percentage of provided liquidity:
LiquidBits: 6128.96 NBT provided, 150 NBT fee; ~2.4%
NuPond: 7839.7 NBT provided, 150 NBT fee; ~1.9%
Nu-Pool: 17750.88 NBT provided, 300 NBT fee; ~1.7%
NuLagoon: 3% I think?

The tllp numbers are based off a quick summation of https://raw.nupool.net/nubits/ and last month’s operator fee. These rates are per month.

[willy]

We’re currently seeing a bit of room in liquidity targets.

I suppose this is mainly due to pool users halting their clients to stop being exposed to BTC price decline.

We’ll come up with a new proposal with increased targets on Poloniex very soon. @woolly_sammoth is currently reviewing the text.

[henry]

Based on the latest development of Nubits trading volume and the need of the network, NuLagoon will increase the size of tier1 fund on Poloniex today.
Nulagoon will also try to improve the management of fund tier3, adding the goal of balancing network-wide liquidity. We will post more detail about this in this week

[mhps]

What is the best way to bring liquidity there? Can we increase the incentives at Poloniex or decrease incentives (rates paid by pools) at other exchanges?

If we incentivise fund to go to the top exchange the results will be a monopoly of a single exchange, which is very risky. I believe the series of hacks Nu exchange got early this year was partly motivated by the fact that Nu exchanges were high value targets. I don’t think we should artificially cultivate a single leading exchange, which both increases the cost if it gets hacked and increases the chance it get hacked – a squared increase of risk.

Plus, I doubt NBT/fiat LPCs are terriblly interested in NBT/BTC unless the reward is enough to counter the rate of BTC price plummet.

[cryptog]

If we incentivise fund to go to the top exchange the results will be a monopoly of a single exchange, which is very risky.

This is what I thought too. Imagine if Poloniex is hacked tomorrow…and most of the liquidity is there.

[henry]

About 10k fund was promoted to Tier1 on Poloniex.We also withdrawed some NBT to Tier3 to balance the network-wide liquidity.

[JordanLee]

@assistant liquidity

[assistant]

Hi @JordanLee

The current Liquidity in the Nu network is:

59728 NBT on the sell side and 32810 NBT on the buy side.

[JordanLee]

About 10k fund was promoted to Tier1 on Poloniex.We also withdrawed some NBT to Tier3 to balance the network-wide liquidity.

Is the liquidity you are providing reported to the network via NuBot / the liquidityinfo RPC? I didn’t notice a change in the liquidity figures reported by the client.

Also, I hope now that 2.0 is out that we can begin to see NuLagoon’s tier 3 liquidity reported to the network.

[henry]

Recent operations:
Day before yesterday:

• 8000 NBT was pormoted from Tier3 to Tier2

Today:

• 65 BTC was promoted from Tier3 to Tier2,
• 1900 NBT was withdrawed from Tier2 to Tier3,
• 29 BTC was promoted from Tier2 to Tier1,
• 6000 NBT was promoted from Tier2 to Tier1,

I restarted Nud and Nubot, the figures seem to be reported right now. Would it be possible that NuBot report Tier3 info?