#TokenIdea GEMINUS (MINU) SHARED LIQUIDITY PROTOCOL

Name of Project

GEMINUS, Shared Liquidity Protocol

Ticker for Token

MINU

1) In one sentences or less, describe your token. This isn’t the time to get wordy, just to the point!

Provide liquidity adding only 1 pair and prevent impermanent loss.

2) Do you have a video to introduce yourself or explain the token? Upload it here and share the link here. (Not required)

None

3) Do you have a logo for your token? If so, upload it here. (Not required)

None

4) How does your token work? Be as detailed as possible

Governance, POV, staking.

5) What problem is your token aiming to solve? How will this positively impact the crypto industry?

1 Not enough liquidity
2 Impermanent loss

Actual problems to solve and solution:
1.Enough tokens but not enough liquidity, enough liquidity but not enough tokens, to solve this problem we can share both of them (Liquidity or Tokens) between two providers.

Liquidity (L) Provider (P, P1, P2…)
Tokens (T) Liquidity Pool (LP)

Using a book of Providers that count (L) or (T) added by each ( P ) we can set a (LP) once (L) and (T) are the same value.

  • DAI/ETH Pool example.

  • Provider            Share           Token           Value $      
            P1                   (T)	    300 DAI          300$
            P2                   (T)	    190 DAI           190$
            P3                   (L)	      1 ETH            300$
            P4                   (L)	      3 ETH           900$
    

(P1) and (P2) value its the same and finally the liquidity can be added.

2.How to solve the impact price that will receive the pair if (T) and (L) is divided between both providers? In a normal liquidity pool, if (L) or (T) changes their prices your liquidity will be affected, the loss is the same whichever direction the price change occurs in. From the Book of providers we select both providers that match in the same Value added. So let’s look at the impact of a price change on a liquidity provider. To keep things simple, let’s imagine our (P1) supplies 1 ETH and (P2) supplies 100 DAI to the Uniswap DAI exchange, giving them 1% of a liquidity pool which contains 100 ETH and 10,000 DAI.
P1 (T) 100 DAI 100$
P2 (L) 1 ETH 100$
This implies a price of 1 ETH = 100 DAI. Still neglecting fees, let’s imagine that after some trading, the price has changed; 1 ETH is now worth 120 DAI. What is the new value of the liquidity pool?

eth_liquidity_pool = 91.2871
dai_liquidity_pool = 10954.4511

Since our liquidity providers has 1% of the liquidity tokens, this means they can now claim 0.9129 ETH and 109.54 DAI from the liquidity pool, we might prefer to convert the entire amount into DAI to understand the overall impact of the price change.
At the current price then, our liquidity is worth a total of 219.09 DAI. So our liquidity providers lost out by 0.91 DAI [by providing liquidity to Uniswap instead of just holding onto their initial ETH and DAI. This loss is only realized when (P1) or (P2) withdraws their liquidity before the price return to the same value as when the liquidity provider added their liquidity, this loss would disappear.

So now to solve this problem what is needed? We need to adjust the eth_liquidity_pool (from fees or individual ( P ) again and match it with the same amount of DAI with the new price impact added

eth_liquidity_pool	           91.666667 ETH
dai_liquidity_pool	            11000 DAI

In fact we only need to remain the inicial value of total liquidity + and add the % earned by the token (ETH growth 20% in that example) between both so the pool remains stable.
Now we repeat the equation, our liquidity providers has 1% of the liquidity tokens, this means they can now claim 0,9166666 ETH and 110 DAI from the liquidity pool, if we convert the entire amount into DAI, our liquidity is worth 220 DAI and we don’t suffer the impermanent loss.
Finally we have equivalent balances for each provider, none of then suffer the problem of impermanent loss and both of them get earnings taking advantage of the new high price.
This can be done better with providers that add only 1 token, just because we will be able to control future impermanent loss from pools if needed.

6) What was the inspiration of this token? How did you think of it?

Usually I don’t have enough liquidity or tokens to join a pool and also impermanent loss

7) Are there any projects out there doing something similar?

I don’t think so

8) What phase is the token in? Explore vs. Build vs. Launch vs. Scale. (If there has been no coding yet, your token is in the explore phase)

Explore phase

9) Will this token be inflationary, deflationary, fixed, or dynamic token supply?

Dinamic to remain the price stable and use it as a pair to control the impermanent loss

10) How long do you think it would take to build a minimal viable token?
I don’t know

11) What skills do you have that would help bring this token to reality? (ex: Marketing, Development, Branding, etc)

Creativity, marketing.

12) Are there any inherent weaknesses or obstacles to building this token? Any items you still need to figure out?

I don’t know anything about coding

If you want to share your Twitter/Telegram handle here for people to reach out and discuss this idea with you, post them below.

@sanper98

This is where you can put anything you want that was not directly asked above! Anything and everything related to your token idea can go here. Any files, links, info, etc

None

2 Likes

This sounds pretty interesting.
I admit I didn’t fully how understand how we get more ETH in the second example. The idea is that instead of paying out the fees to everyone we keep them and then distribute them proportionally to cover impermanent loss?

Btw I know that Bancor 2.0 is focusing on removing impermanent loss as well. Not sure how they do it but you might interested :slight_smile:

If we have single providers (Provider who add 1 token only) we can add the token we need with no mistakes, for example, in that case a Provider need to add eth, and then the pool itself need substract some DAI

It’s a bit difficult but I think I’m near the solution, thanks for your comment :+1:t2:

2 Likes

Very nice work i good choice and a finest and prepare work