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Currently providing liquidity in the DeFi is quite unattractive. Liquidity Pair (LP) holders come across multiple risks such as Impermanent Loss (IL) or even opportunity cost, which is not sufficiently compensated by the 0.3% transaction fees (and sometimes even less) paid for their service. The worst thing is that others are making money from decentralized liquidity through Miner/Maximal Extractable Value (MEV), while the LP holders are the ones taking all the risk.
That’s why Hive Arbitrage comes with a solution greatly inspired by Liquid Finance and their Liquid Arbitrage Mechanism (LAM). Hive ARB protocol will be powered by two separate tokens - hETH and HIVE, the first token (hETH) will be pegged to the price of ETH and backed by the Hive Arbitrage treasury.
Our treasury will hold multiple assets paired with hETH, such as WETH and GMX. When the price of these changes relative to hETH, we can arbitrage our pairs and extract MEV, which will be paid out to HIVE owners.
Hive Arbitrage protocol can completely renormalize the price of hETH in the market. This is because only the protocol can expand and contract the supply of hETH and, as such, repeg the token to ETH without causing market inefficiency elsewhere. Therefore, the LAM mechanism from Liquid Finance solves the value accrual problem of LPs and increases market efficiency by rewarding those that provide liquidity and not rent seekers.
We believe that our innovative protocol will fix the broken incentive mechanisms for decentralized liquidity and help bring about a truly decentralized financial system.
Join us on Discord and on Twitter to keep track of our advancements.
Currently providing liquidity in the DeFi is quite unattractive. Liquidity Pair (LP) holders come across multiple risks such as Impermanent Loss (IL) or even opportunity cost, which is not sufficiently compensated by the 0.3% transaction fees (and sometimes even less) paid for their service. The worst thing is that others are making money from decentralized liquidity through Miner/Maximal Extractable Value (MEV), while the LP holders are the ones taking all the risk.
That’s why Hive Arbitrage comes with a solution greatly inspired by Liquid Finance and their Liquid Arbitrage Mechanism (LAM). Hive ARB protocol will be powered by two separate tokens - hETH and HIVE, the first token (hETH) will be pegged to the price of ETH and backed by the Hive Arbitrage treasury.
Our treasury will hold multiple assets paired with hETH, such as WETH and GMX. When the price of these changes relative to hETH, we can arbitrage our pairs and extract MEV, which will be paid out to HIVE owners.
Hive Arbitrage protocol can completely renormalize the price of hETH in the market. This is because only the protocol can expand and contract the supply of hETH and, as such, repeg the token to ETH without causing market inefficiency elsewhere. Therefore, the LAM mechanism from Liquid Finance solves the value accrual problem of LPs and increases market efficiency by rewarding those that provide liquidity and not rent seekers.
We believe that our innovative protocol will fix the broken incentive mechanisms for decentralized liquidity and help bring about a truly decentralized financial system.
Join us on Discord and on Twitter to keep track of our advancements.
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