Bond Protocol-owned Liquidity with ApeBond

[boba_apebond]

Greetings from the ApeBond team!

We’ve been closely following K9’s journey and are excited to introduce a tailored liquidity solution for K9 Finance and its $KNINE token.

We’ve done an analysis running K9’s token metrics through our data models surrounding liquidity and bonding/ treasury diversification strategies and found that we can help build more assets strategically on-chain that the DAO can use for growing liquidity and/or general treasury diversification.

This proposal aims to address K9’s on-chain liquidity challenges, ultimately improving the token’s tradability with reduced slippages and price impacts for the entire community. By leveraging Bonds, we seek to establish permanent DAO-owned liquidity for the K9 Finance DAO. Additionally, our partnership offers exposure to our user base, fostering increased trader volume and attracting new community members.

Through ApeBond’s innovative bond offerings, we aim to build DAO-owned liquidity, diversify the K9 treasury, and support the ongoing growth and development of K9 Finance.

We’re excited about the opportunity to collaborate and contribute to K9’s success.

BENEFITS TO K9 FINANCE COMMUNITY:

By implementing this proposal, the K9 Finance community stands to benefit in the following ways:

• More & Deeper Liquidity Pool: By Bonding $KNINE tokens set aside for liquidity provisioning, we aim to establish lasting Protocol-Owned Liquidity (POL). This will address liquidity sustainability issues common in the industry, reducing the token’s reliance on temporary rented liquidity through farms/ staking pools and stabilizing its price and liquidity pool which is great for the community and token holders.

• Long-Term Liquidity Building: Through running an ApeBond Bond, the proposal intends to build approximately $170k - $190k of liquidity for the K9 DAO over a 2-4 month period. This permanent liquidity will contribute to the long-term sustainability and growth of the protocol, providing a stable foundation for future development be it marketcap or user growth.

Closeout Liquidity Debt:

Liquidity Health chart:

This proposal targets the closure of Liquidity Debt for $KNINE, which is the distance from where the token is on the chart above to that green sustainability line, ensuring the token’s liquidity can support larger trades and provide a stable trading environment for all community members. This reduction in Liquidity Debt is crucial for maintaining token value and preventing hyperinflation due to emitting tokens constantly for liquidity rewards, contributing to the overall health of the protocol.

• Community Engagement and Growth: The partnership with ApeBond will not only improve liquidity but also attract new users to the K9 ecosystem. By leveraging our marketing campaigns, quests and AMAs, the proposal aims to foster community engagement and expand the K9 user base via cross-pollination with the ApeBond community.

• Transparent Reporting and Community Involvement: Throughout the bonding process, regular analytics will be provided to the K9 community, ensuring transparency and accountability. Community feedback and involvement will be encouraged, with opportunities for discussion and collaboration in shaping the future of liquidity management for $KNINE.

PROPOSAL DETAILS:

- WHAT:
Bonding with ApeBond will involve allocating $200k in $KNINE tokens towards building additional POL on chain. This allocation will come from the bucket set aside for liquidity provisioning in the K9 tokenomics. Key features include user purchasing vested $KNINE tokens at a slight discount and paying with ETH. The raised ETH gets transferred to a wallet controlled by K9 Finance instantaneously throughout the Bonding process. This ETH will be added back to grow the K9 Finance Uniswap V2 Liquidity Pool (liquidity pool address: 0xd7cef1e0c02b50e9c5852f47736880b66e50acde).

- WHO:
Stakeholders include the ApeBond Protocol providing the proposal, data analysis and Bond infrastructure to make the Bond happen. Additionally the council gave input for this proposal to come in front of the larger community for thorough discussion and DAO vote.

- WHERE:
The Bond will occur on the Ape.Bond. We will provide an iframe for it to be integrated on the K9 Finance webpage as well.

- WHEN:
Discussion in the Forum (Week 1-4): Open discussion on the K9 Finance forum, we are open to AMAs and/or community calls to present and discuss the proposal. This phase involves gathering feedback, answering questions, and ensuring alignment among stakeholders.

Launch of Bond (Week 5): If the proposal gains sufficient support, the Bond could be launched in the 5th week.

Marketing Campaigns and Bond Promotion (Week 5): A pre-launch marketing campaign would precede the bond sale. The bond would be actively promoted through various channels, including community forums, social media, and partnerships we have.

Ongoing Marketing and Bond Monitoring (Week 5-13): Marketing efforts continue throughout the bonding period to maximize community engagement and participation. Regular updates and status reports on the bond’s progress would be shared to maintain transparency and accountability.

End of Bond Sale Phase (Week 13): The bond sale phase concludes, and final status updates are shared with the K9 Finance forum. The POL raised for the K9 Finance DAO is reviewed, the liquidity position evaluated and the next steps as to running a potential subsequent Bond is discussed.

Based on this breakdown, it would take approximately 13 weeks to complete the entire bonding process outlined in the proposal. However, the exact timeline may vary depending on factors such as community feedback, voting processes, and the readiness of all parties involved.

- HOW:
Upon the approval of this proposal, K9 Finance will transfer $200k worth of $KNINE tokens from the liquidity incentives bucket, as specified in the K9 Finance Tokenomics, to our designated ETH Bond Partner wallet. Following this, we will finalize the launch and marketing strategies and complete all necessary development work. Subsequently, the Bond will be activated, enabling web3 users to acquire $KNINE tokens at a discounted rate, which will then be vested to them over a 30-day period. The discount offered with the Bond is dynamic, influenced by user demand and token price fluctuations. A higher demand coupled with stable token prices will result in a lower discount.

IMPACT ASSESSMENT:

This proposal from the ApeBond team introduces a tailored liquidity solution for K9 Finance and its $KNINE token, aiming to address existing on-chain liquidity challenges. By leveraging Bonds, the proposal seeks to establish permanent DAO-owned liquidity, diversify the treasury, and enhance the overall trading experience for the K9 Finance community whilst acquiring new users.

Overall, this proposal presents a comprehensive plan to enhance liquidity, community engagement, and transparency within the K9 Finance ecosystem, ultimately contributing to its long-term success and sustainability.

ApeBond looks forward to engaging with the community and working on this proposal together for the betterment of the K9 Finance ecosystem as a whole. We welcome any feedback/ questions, feel free to respond in this thread and we will make sure to answer those.

[Frank]

Does the K9 token need more liquidity? Is it a concern or could it be a road block or effect the price of the token?

[RyanCayon]

It looks like K9Finance is a worthy project behind Shibarium, if it keeps garnering attention from other institutions offering such proposals. I say we should hunker, and double, down on our original stake and hold; at least for the entirety of this bull run.

Furthermore: If you take a glance at the current index between BTC, ETH, K9, and BAD you will see what I see. Interest.

In contrast I also watch Gala, IMX, and Bricks. The intrigue for this project is definitely higher.

[Ralehale]

A lot of this is beyond my understanding fully, but form what I’ve gathered, these DAO votes are only put forward if the Team feels it’s what’s best for the project long term, and for the community as a whole.
This proposal seems to allow us to diversify as a project, build a stronger liquidity floor for larger trading, attracting whales and more volume in general, and fosters community growth as well… I say we go for it.

[dorry.shib]

I thought K9Finance is the project that will bring liquidity. I don’t know how we sign on to another project before our is off the ground ? this seems like a Q1 2025 revisit . There is a good chance i don’t understand it but i would still feel its too early. These are my opinions.

[Joyride01]

Personally I would like to hear the informed opinion from the DAO team and Buzz on this. Maybe a pro and con explanation on why this would or would not Benefit us. My first glance tells me this sounds like a good financial action but I don’t t see it from multiple angles on how it could harm or benefit us.
So please give us a good pro and con break down from the DOA team.

[Pulse_Digital]

My first question would be "Why not take the $200k worth of $knine being requested here and simply pair it with $200k ETH from the treasury to add into our own Uniswap pool if we need to add more depth?

I guess I need more understanding of why the bonding process benefits $knine holders other than just adding liquidity.

[Dreamreader]

Buy tax 1% sell tax 3.99 with 2.66% refunded in 2 years. Apx revenue of 1 million monthly sales would net the k9 team. 10k monthy for buy tax and 39.9k on sell tax based of 50% sell rate equals equals 19.95k monthly. This is apx 30k montly at the price today. Once staking is live this should hold stable at 3x giving 90k monthly for k9 dao. These are small numbers and would be exceptionally higher using real trading volume. Examples are low for easy comparison

[MrLightspeed]

@Joyride01

Personally I would like to hear the informed opinion from the DAO team and Buzz on this. Maybe a pro and con explanation on why this would or would not Benefit us. My first glance tells me this sounds like a good financial action but I don’t t see it from multiple angles on how it could harm or benefit us.
So please give us a good pro and con break down from the DOA team.

I’ll be happy to break this down Barny Style. Give me a bit to work through it @Joyride01

General proposal

[MrLightspeed]

Hi everyone, there are two words that will break down the value proposition of this proposal: Capital Efficiency. I’ll get into that shortly.

TLDR: What - $KNINE needs a deeper liquidity profile. How - Let’s discuss:

This proposal is very well detailed. @boba_apebond addresses a variety of issues that require a specific solution: A deeper liquidity profile. The math is all sound to me.

The how is just as important as the what in this situation. Three ways this can be done (there are more):

1. Add liquidity manually (least capital efficient)
2. Incentivize liquidity placement by others i.e., farming (not sustainable)
3. Conduct a unique sale (most capital efficient)

Two factors that help one choose the right option:

1. Timeline
2. Funding

Based on the upcoming unlock date, I recommend a hybrid solution. Placement of a small amount of additional liquidity (e.g., $25,000 each side) now and the use of this proposal for a long-term solution seems like a fair compromise.

Issues that would be mitigated:

1. Slippage - price impact of trades will be lowered / less volatile
2. Arbitrage - negative aspects of arbitrage are minimized

I like this proposal because it makes efficient use of capital. The project’s treasury is outstanding. Nevertheless, one should make optimal use of the capital. Preservation of the $ETH and $USDT can help support other aspects of the project fighting for resources: marketing, exchange listings, etc.

I think this approach will allow us to continue other initiatives such as a large marketing campaign being developed, provide us with flexibility on exchange liquidity / fees, and still achieve the goal in the long run of deepening liquidity.

For those that have seen me do special sales to raise liquidity in the past (post launch), we know how effective that can be. Having things structured in an organized way and provides community engagement is a plus. I haven’t seen this approach before, but I like this for the structure and capital efficiency it offers.

Of note, the project has already been deepening the liquidity on the exchanges so this proposal will ensure all aspects of liquidity management are aligned.

All the best,

MLS

[Frank]

Is there a cost to the treasury for this proposal?

[MrLightspeed]

They have a 5% initial and a 5% success fee if they complete the sale. Overall, to have someone do all the work by outsourcing the effort seems reasonable to me. It’s a months long effort and not a one-and-done either. With smart contract deployment for the raise, engagement, etc., the fee seems to cover a variety of aspects.

proposal General

[Joyride01]

Would ApeBond be the best choice to do the liquidity staking with? Where would they rank on our option list?

ApeBond gave us a DOA recommendation so this would be in ApeBone financial interest. This wouldn’t mean it was in K9 best interest. Would ApeBond be a wise choice? We should not just choose this option because it has been the only recommendation of its type.

@ MRlightspeed.
I don’t believe that a 3rd party recommendation to the DOA is necessarily in K9 best interest. If this is something that the DOA believes to be a viable option , I would then recommend that we make a separate proposal to have the DOA contact multiple options to identify the best fit for K9 needs. Would I be wrong ?

Not to insult ApeBond. Just doing my due diligence to be properly informed. Thank you

[Ruggrat]

I like this approach, vet other opportunities similar to Ape.Bond before we commit capital.

[MrLightspeed]

The Roundtable of Dogs would have to review it and they can kick it back for adjustments to the proposal or decline the offer.

I like this better than the unsolicited proposals in telegram so I do have to tip my hat at the level of effort and professionalism here.

Having said that, you are right: I did say it’s not the only solution. There could be others. I just don’t know of anyone that does it in this manner. Maybe someone else does?

[Joyride01]

After much thought I believe this DOA recommendation should be properly Vetted BY the Round Table and K9 team and re submitted after proper review and consultation. Other alternative options should be considered when vetting this proposal.

[MrLightspeed]

This is the vetting process. The community must comment prior to the Round Table doing it’s review. Critical that this is not centralized and that a small number of people serve as gatekeepers to what the community can read.

[Couch_Adventures]

I’m going to ask a question and I don’t want it taken in the wrong way:

Had we not voted to reduce taxes on buy and sell, would ApeBond or some other 3rd party have been needed to get our liquidity debt handled?

I just feel like removing funding to the wallets that could have taken care of the project were ripped away just because “taxes limit buy-in”.

If my original question is the case to why ApeBond is now entering the ring with their solution, we really need to slow down the voting process and vet the proposals all the way through.

Don’t vote away ownership of the project by forcing it into debt to other projects!

If I’m off-base, let me know. It just seems convenient that they’re sliding into our DMs so quickly after lowering taxes and sending 100K a month to other initiatives for the next 6 months.

We will have exposure to other communities through our marketing campaigns, so how much more exposure could ApeBond bring to the table?

[RyanCayon]

In congruence with your foresight I believe we should pause on this proposal: Haste makes waste applies here. This project (K9) has barely gone through a launch with the backend still being worked out. We are in the process of ironing out some of the kinks (in the application). The most recent tax restructure is still on everyone’s mind. This institution (ApeBond) coming forth early, in all earnestness, with this is flattering; but we must consider their competition.

Although they are the first to come hither we have not seen anyone else set forth a counter/competitive offer.

If there is a vote on this option (proposal) I believe it would only be fair to include a vote of “decline” at this stage. I believe for every vote we set forth, since the first tax restructure came and went, we should install this in every vote as not doing so spells distrust in the project to futures. Not being able to say no, nay, decline, refuse, or reject, or otherwise allowing dissenting opinion within the vote; creates a one sided argument.

On the flip side, we should be doing our due diligence in sending an ambassador to the doors of ApeBond’s competition to see if they have any interest in K9.

[Archangel]

Great discussion here so far and I love seeing the thoughtfulness in the proposal and the comments. From my perspective, I have a few points for consideration from our community and from ApeBond.

Approximately 25% Total Cost
There is a 5% initiation fee, 5% success fee, and what appears to be an average 15% discount on the tokens put up for bond purchases (based on historical averages from the ApeBond website). In short, $200,000 of potential liquidity immediately becomes $150,000 potential liquidity.

Only a 30-Day Lock Available
While the additional liquidity will be advantageous to K9, this seems to “kick the can down the road” in regards to potential sell pressure from this particular arbitrage opportunity. Not only will vesting unlock pressure be a consideration but also this bond sale, if approved, will occur shortly after the first vesting unlock when it is most likely (only my opinion) vested holders will sell to recoup their initial investment. The timing coupled with the 30-day lock could be more harmful to the project than the liquidity injection.

Opportunity Cost
We should take into consideration the treasury management proposal alongside the ApeBond proposal. While looking at treasury investments that may provide anywhere between 3%-13% APY over a year time-frame, this proposal has an immediate 25% expense.

While I appreciate ApeBond’s proposal, I am currently leaning toward this proposal not being the most efficient use of funds nor effort.

Thoughts?