75th Blvd Liquidity Pool Case Study
Jerry Chu
In this case study, we dive deep into the performance metrics of the recently spun-down liquidity pool for 75th Blvd. Let's analyze the data to better understand the dynamics, returns, and insights from this liquidity event.
Key Metrics
Liquidity Pool Duration: 300 Days
Average Limit Order Swap Price (Last 6 Months): $49.28
Average Market Order Buys Price (Last 6 Months): $47.98
Average Market Order Sells Price (Last 6 Months): $46.17
Actual Token Redemption Price: $51
Cumulative Staking Totals
- Total USDC Staked: $15,401.54
- Total Base Tokens Staked: 1,310 Tokens
Staked Balances at Spin Down
- USDC at Spin Down: $5,970.70
- Base Tokens at Spin Down: 50 Tokens
Total Liquidity Provider Fees Earned
- Quote Side Fees: $359.54
- Base Side Fees: $325.53
Returns Analysis
The returns calculated at the spin-down event are as follows:
Quote-side ROI: 6.02%
Base-side ROI: 13.02%
Note: The base ROI calculation utilized an oracle price of $50.00 per base token at spin-down for an approximate valuation.
Annualized Returns
Considering the pool duration (300 days), annualized returns (without compounding) are:
- Quote-side Annualized ROI: 7.32%
- Base-side Annualized ROI: 15.84%
Surplus and Final Balances
At spin-down, a surplus of 19 property tokens remained. With a redemption price of $51 per token, the surplus tokens were valued at $969.
- Final Quote Balance: $5,049.42
- Additional Value from Surplus Tokens: $969
- Total Final Quote Value: $6,018.42
This resulted in a net gain of an additional $63.93 over the original staked amount ($5,954.49), excluding any penalties paid.
Thus, the adjusted USDC return factoring the surplus tokens is 7.09%, translating to an annualized return of approximately 8.6%.
Insights and Observations
- The pool generated positive returns for both quote and base token stakers.
- A noticeable surplus at spin-down highlights potential inefficiencies or opportunities for improved liquidity management.
- Annualized returns were robust, especially considering minimal compounding.
Conclusion
The liquidity pool for 75th Blvd provided steady and attractive returns. The surplus of tokens at spin-down emphasizes the importance of liquidity strategies that optimize token management. This case study demonstrates valuable lessons for future liquidity events and staking strategies.
