[Passed] Trustless Liquidity Pool operation on Bittrex

We are happy to announce the first full outing of the Trustless Liquidity Pool. After a successful Beta period, during which many iterations were tested, the pool software is ready to provide liquidity for the Nu network.
The full proposal can be viewed below. We would like to have the proposal passed before the point at which liquidity provision is started. The main points of the proposal are as follows:

  • Intention to provide 20,000 NBT liquidity on Bittrex
  • 30 day operation
  • Maximum compensation of 7.5% per month (0.25% per day)
  • Minimum payout of 1 NBT
  • Payouts every 24 hours
  • 300 NBT pool fee
  • 1500 NBT compensation payout for liquidity providers
  • 1800 NBT requested in total
  • Liquidity offered for 9% fee

Liquidity providers remain in full control of their funds throughout the operation of the pool.

Proposal RIPEMD160 hash: 7145a48af6cfda756b3b03ec91949a517514f4b9

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Custodial Address: BNUpooLxGbHXSs7Qcwi5EBXzZ82BbWwsMN
Amount Requested: 1800 NBT

After the public release of an NBT market on Bittrex we, @creon, @woolly_sammoth and @willy, will start a trustless liquidity pool server to provide liquidity on the BTC/NBT market. A target of 10,000 NBT on the bid and ask side of the order book will be provided by the pool, resulting in a total maximum liquidity of 20,000 NBT. The operation will end after thirty (30) days. The pool will be formally run by @woolly_sammoth.

Liquidity provided by users will be compensated with up to seven point five percent (7.5%) per month (0.25% per day) using the pools calculations to allow a fair distribution of returns amongst liquidity providers. 1,500 NBT of the requested amount in this grant will be held as reserve to make payouts to connected users. Payouts will take part every 24 hours. The minimum payout is 1 NBT. The pool fee is 300 NBT and serves as compensation for the effort of supporting the pool, supporting the users and operating the server.

After the operation we will provide the shareholders with detailed information about the liquidity provided by the pool. If the target was not reached during some time, or users provided enough liquidity to allow a smaller interest rate, then the remaining funds will be used in the following operations.
If, for some reason, the decision is made to discontinue the pool project after the term has passed, the remaining NBT from previous grants will be burned.

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Verify. Use everything between and including the <custodianhash></custodianhash> tags.

Awesome job guys! Historic moment for the Nu network.

I’ve never used a mining pool or liquidity pool before, but I’m looking forward to trying yours out once Bittrex has added NBT support.

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Just to clarify: The server that is currently running does not pay 7.5% per month. This will be the case after the proposal has passed and after the implementation on Bittrex side. So whoever just put a bunch of NBT on the pool: please consider that the payout and target is extremely small. Thanks!

I think this offer is too good to not vote for. My only concern is that we still don’t have an official confirmation from Bittrex that they add NuBits. Hopefully the passing of this motion will help them making the decision.

Will add this to my datafeed soon.

We are working with their team behind the scenes to prepare for the addition of NuBits. That is not a 100% guarantee that NBT will be added, but the balance of odds at this point suggests NBT will be added soon after open-sourcing, with NSR hopefully to follow afterwards.

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About how much liquidity will we need in the pool in order to reach the levels when we were consistently in the top 3? Is there any way to determine this?

I assume you meant the top 3 volume on CMC? They are different things. With 100k liquidity you can generate millions of volume as long as there are many transactions going forward and backward. So it is a mix of liquidity and transactions on the exchange to generate volume.

This could be poorly estimated from the small amount of grants we had so far. In general I would expect some kind of logarithmic increase of the volume when increasing the liquidity.

Awesome proposal!
The fee is reasonable.
I have been using the pool in beta mode and I was very impressed by the level of understanding showed by @creon about everything basically.
I am impressed also by his dedication even if he is not a member officially of NuBot dev team or a contractor.

I will vote for it shortly.

Just one question, below.

Does it mean that if you want to have a daily payout transferred you need to provide at least 400NBT in liquidity (buy side or sell side)?
If you want at least one payout in a month time, my understanding is that you would need at least 13.4NBT in liquidity provided. Is that correct?

Very good point, I really didn’t pay any attention to this number in the end. I already regret that this is in the proposal text, because actually its not even important for shareholders. So right now there would be around 13.5 NBT “minimum liquidity” you have to provide - I don’t like that, but it will be hard to change this now.

However, since this operation has a clear termination date, the whole problem is not that big because in the end when the server is taken down, all outstanding payouts will of course be sent regardless of the amount (well, if its larger than the tx fee).

In that case, I do not think there is anything to modify in the current proposal.

Verified: RIPEMD160 hash: 7145a48af6cfda756b3b03ec91949a517514f4b9

By the way, this proposal is for bittrex but in the near future I imagine we will see proposals for other exchanges as well, so that liquidity contributors can spread theirs risks.
The trust-less liquidity pool scheme as it is currently designed in the code source is not only trust-less in the sense that the liquidity fund remains in each contributor’s account but also distributed in the sense that the fund can be spread over several exchanges.
I have never used that feature so far but I think it is a very important one given the fact that one exchange can be hacked.

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Yes, this is what I meant. You only need a fraction in order to generate large volumes. I was just wondering if there was any way to determine what a certain amount in the pool could possibly generate in volume.

Multiple exchanges will be an important factor in the future of the pool. For the first run (possibly the first few) we wanted to use it as fact finding. Hopefully by the end of the 30 days we will have empirical evidence on how much liquidity we can provide, what rates people expect and how much effort there is in running the pool. That will allow us to tailor future proposals.
I feel confident that multiple exchanges will feature in those future proposals.

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Good to wake up to this announcement.

Can you expand on the concept of maximum? What if someone joins the pool with an amount which in total exceed 20k?

The statement “total maximum” is possibly a little misleading. That figure is the target amount of liquidity for the pool. Users are welcome to provide more liquidity if they want but only the first 20k will be compensated by the pool. The pool uses a variable rate calculation to ensure that users can out bid each other for inclusion in that compensation should more than 20k be provided to the pool. More information on that system is available in the other thread (other faq threads will be coming soon).
This first run is being used as a data collection exercise to aid with future proposals. We felt it important to keep the target realistic while also providing a decent amount of liquidity.
Its going to be exciting for sure.


We just passed 2,500 votes, and that after three days. I am overwhelmed by the support, thank you!

Now I hope that Bittrex will be quick with the implementation on their side.

You have consistently around 80% of the votes. Don’t think you can get much better.

verified and voted.

@assistant custodian vote BNUpooLxGbHXSs7Qcwi5EBXzZ82BbWwsMN