Proposal for Adding Liquidity to KNINE/WETH Pair on Uniswap

General
1

Proposal for Adding Liquidity to KNINE/WETH Pair on Uniswap

(1) Introduction and Objective

K9 Finance DAO proposes adding $250,000 of liquidity to the KNINE/WETH pair on Uniswap using treasury funds. Currently, the DAO holds $300,000 of unused USDT that is not allocated to any liquid staking or money market investments. By leveraging a portion of this USDT to support the KNINE/WETH liquidity pool, the DAO aims to both strengthen liquidity and take advantage of transaction fee earnings.

This proposal suggests converting $125,000 of KNINE tokens and $125,000 of USDT (to be converted into WETH) to add liquidity to the DAO’s liquidity pool on Uniswap. This strategy maintains a robust USDT reserve in the treasury, ensuring that the DAO can still support potential budget extensions while capitalizing on favorable market conditions for Ethereum. By enhancing liquidity, the DAO can reduce volatility and better manage buy and sell pressure during what could be a turbulent period in the broader macroeconomic landscape.

(2) Benefits to K9 Finance Community

  • Increased Liquidity: Adding $250,000 to the KNINE/WETH liquidity pool will strengthen K9 DAO’s liquidity position, allowing for smoother transactions and less volatility for KNINE holders and DAO members
  • Transaction Fee Earnings: By allocating treasury funds to Uniswap, the DAO can generate passive income from transaction fees within the liquidity pool, contributing to a self-sustaining treasury.
  • Market Strategy: Utilizing USDT to purchase WETH at a time when Ethereum’s price has lagged behind Bitcoin provides an opportunity to acquire Ethereum at a favorable rate, potentially increasing the value of the DAO’s assets.
  • Risk Mitigation: Enhanced liquidity in the KNINE/WETH pool reduces the impact of market fluctuations, allowing K9 DAO to better absorb buy and sell pressure over the coming months.

(3) Proposal Details

(a) WHAT
The proposal suggests that K9 Finance DAO allocate $250,000 of treasury funds to the KNINE/WETH liquidity pool on Uniswap:

  • $125,000 of KNINE tokens will be added to the pool.
  • $125,000 of USDT will be converted to WETH and then paired with the KNINE tokens in the liquidity pool.

This action will leave the DAO with a sufficient amount of USDT to support any monthly budget extensions, while also putting funds to productive use in the liquidity pool.

(b) WHO
The stakeholders impacted by this proposal include:

  • KNINE Token Holders: All KNINE holders will benefit from improved liquidity and reduced price volatility.
  • K9 Finance DAO Treasury: The treasury will earn transaction fees from the liquidity pool, adding a potential source of income.
  • Management Council: Responsible for overseeing the allocation and management of liquidity to ensure it aligns with the DAO’s objectives.

(c) WHERE
This liquidity will be added to the KNINE/WETH pool on Uniswap, enhancing liquidity for K9 DAO’s main trading pair.

(d) WHEN
Upon approval of this proposal, the liquidity allocation process will begin, with funds deployed to Uniswap as soon as the necessary conversions (USDT to WETH) are completed.

(e) HOW
The liquidity allocation process will be as follows:

  1. Conversion of USDT to WETH: $125,000 of USDT from the treasury will be converted into WETH.
  2. KNINE/WETH Pairing: The $125,000 of WETH will be paired with an equivalent $125,000 worth of KNINE tokens.
  3. Liquidity Pool Deployment: The KNINE/WETH pair will be added to the liquidity pool on Uniswap, allowing the DAO to benefit from transaction fees.

(4) Impact Assessment

The expected impact of this proposal on the K9 Finance DAO ecosystem includes:

  • Short-Term: Immediate increase in liquidity for the KNINE/WETH pair, reducing volatility and providing a more stable trading environment.
  • Long-Term: Passive income generation from transaction fees, adding to the treasury’s self-sustainability and potentially increasing the value of DAO-held assets.
  • Risks and Uncertainties: The primary risk is the potential for WETH price fluctuations. However, by retaining some USDT in the treasury, the DAO maintains flexibility to respond to market changes if needed.

Metrics for Success:

  • Increased KNINE/WETH Liquidity: The DAO sees a notable improvement in the liquidity of the KNINE/WETH pair, resulting in reduced slippage for traders.
  • Earnings from Transaction Fees: The DAO generates passive income from transaction fees in the liquidity pool, contributing to a sustainable treasury.
8 Likes
2

Yes, please! Thank you once again for thinking ahead on behalf of the DAO, much appreciated! <3

2 Likes
3

I support this proposal…

3 Likes
4

In the words of Captain John Luc Picard:

“Make it so”

3 Likes
5

I am all for this. Add the liquidity please.

4 Likes
6

Great plan! I am in full support of this proposal!

3 Likes
7

100 percent got my support

3 Likes
8

Always good to be planning ahead of time and taking advantage of good prices. Let make it happen.

4 Likes
9

I support this proposal. Very thought out and DAO focused.

4 Likes
10

I fully support this proposal! Thank you for thinking of the market fluctuations ahead, good to also know that this will benefit the treasury by generating more passive income.

4 Likes
11

This proposal is beneficial, I support it!

4 Likes
12

Oui bonne idée j’approuve à 100%
Yes i approuve 100%
Long term thinking is the way of success

3 Likes
13

Are there any other C/DEX’s, both new and old, that we could create liquidity pairs for trading/swapping/buying K9Finance coins?

I say no to putting up more liquidity into Uniswap. Even though I personally use both MM and UNI for my transactions, I believe in inclusivity. We should instead put a liquidity pair into another C/DEX to attract more stakers.

Blackrock is creating a framework for exchanges to trade in bitcoin right now. Do you think getting listed on that exchange would open up K9Finance to a broader market or be a waste of time IF we had the ability to?

1 Like
14

I think this is a good time to add more liquidity.
More liquidity less volatility will give new investors a bit more confidence in ouw wonderful Knine.
Support adding lp

15

I love that you often bring a different opinion and an alternative perspective.

This makes everyone (or No One) question their own opinions and actually think critically.

Having said that, putting anything on CEXs requires large capital expenditures to get listed and the financial benefits of that are very questionable.

Putting anything on other DEXs may not necessarily bring in new exposure. When people going to DEX to swap for something generally they already made up their mind about what they are swapping for. I do not go to a DEX just to window-shop for a random unknown token to buy.

But foregoing the largest DEX would limit the potential revenue that DAO can earn from swap fees. As a DAO I would not choose that for the sake of ‘inclusivity’.

Coming back to original proposal - I provisionally support it.

There is a risk of impermanent loss (or permanent - if DAO decides to withdraw that liquidity).
But considering that we are (seemingly) in the early stages of next bull cycle - rising tide lifts all boats and in my personal opinion the chances of ETH rising over next 6-12 months are decent (NFA) so may provide superior returns to simply holding assets in USDT.

One thing I would like to know is what is expected APY from adding this extra liquidity to the LP given our current trading volume - to be able to compare it with the ±2.6% given for pure staking of ETH.

1 Like
16

Team is always thinking ahead…Great proposal…100%

1 Like
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I’m assuming this will cause sell pressure for KNINE to be converted to ETH.

18

This proposal does not include any selling of KNINE or any sell pressure of KNINE. What part of the proposal gave that impression so that it can be adjusted?

2 Likes
19

Sweeet, thank you Buzz, I misunderstood when you stated convert 125k of KNINE…

This proposal suggests converting $125,000 of KNINE tokens and $125,000 of USDT (to be converted into WETH) to add liquidity to the DAO’s liquidity pool on Uniswap.

20

Sounds Good…the sooner the better ETH is moving