@SuplabsYi dude, the contracts are not ready, the code is not launched, and is it still under developement as I mentioned, there has never been any bounties.
Why are you being so difficult?
@0xjayeshyadav@veda_labs The vault could auto pause deposit once it detect issues with reporting NAV. (this is justified because vault is in distress, not operating normally)
let existing user exit with hair cut if they choose to, or stay on till the issue is resolved.
@ohMySolboy@yieldbasis I think I remember now :) yep totally makes sense, I think a direct auction to capture IL could achieve similar results of Yieldbasis, maybe even better.
What I learnt today, an easier way to understand @yieldbasis
The Impermanent Loss(IL) Problem
LPs have IL, which happens because the nature of x*y=k causing the value to deviate from linear curve. [pic1]
Rebalance
The difference can be reduced if we borrow 0.5 Lp value and combine it with the LP itself. This will push the total value to 1 beta of asset.
So when price change leads to LP value change, we rebalance to back to the linear curve. However this does not magically remedy the IL already happened, it just makes future IL less. [pic2]
Constant Rebalancing
If we constant rebalancing, in theory we can reduce IL to 0. However in reality this is not possible, so we still will have some IL, just largely reduced. [pic3]
Constant rebalancing requires incentives paid to arbitragers of the virtual AMM pool, this process also uses a flashloan, so its 2 extra costs to the LPs.
LP Profitability
Revenue - AMM trading fee.
Cost - IL to virtual AMM arbers + flashloan fee during second arbitrage (no IL for base AMM)
More volatile the asset -> more IL saved -> same cost for rebalancing -> more profit.
Caveat
if asset price is not moving much, not much IL saved, rebalancing cost could back fire.
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@ohMySolboy@yieldbasis yep the whole point of @yieldbasis is constant rebalancing to reduce IL.
Eigen Auction hook sounds interesting, is it like a self arb hook?