BAMarketMaking_MarketMaking_20250313

[worthy belfry]

https://docs.google.com/document/d/1tsEq3M4MdmJjA68QAUyrsD1I8HCNVpo7Bns-_9lJbjc/edit?usp=sharing

[keen socket]

Are there no Market Maker currently ?

I support this proposal

[ebon fractal]

I completely agree, we need market makers to increase liquidity, create trust, attract new investors.

[serene mason]

its good idea

[faint osprey]

I concur with this proposal, market maker helps a lot and the fact that it lower barriers for new users.

[viscid widget]

@half prawn I left you some comments. The main things is that I think we should adjust the funding request to not include the consolidated funds for market making. I suggested to add a request to execute section that states that the previous market making accounts would be combined and managed by the proposer if passed. Ty

BAMarketMaking = Block Authority Market Making

[remote mango]

Looks like a no brainer to me.

Great proposal!!

[prime zealot]

@urban python is a community MM.

https://discord.com/channels/1055863853633785857/1296300495249604628

[urban python]

While at some point I heard that was going to be approved, it never really happened so I definitely feel a bit bumped about that 🙂

[prime zealot]

https://docs.google.com/spreadsheets/d/1bWLIrgfbPxYZ61IgtZ58GXPl8LMoRen6ym7Qu0PDoT0/edit?gid=1470688432#gid=1470688432
It was approved 2 months ago. You haven't received anything??

[prime zealot]

Please check your email and reach out to Scotty. I had no clue you weren't being compensated for your MM.

[worthy belfry]

@urban python

I will create the token request form and email. @shell flare The request has a usdc amount. Do you want it completed like EVM LP?

[prime zealot]

Yeah. We will repeat that process for the BA proposal if it passes as well.

[worthy belfry]

@merry finch will process the approval

[urban python]

I think it's a great proposal, I support it.

[viscid widget]

For BA funding request I feel like it would come out of this bucket
https://watch.voi.network/allocation/treasury-early
What do you think @prime zealot

[prime zealot]

I don't see why not.
I think the important part of the proposal is:

1. USD
2. Salary

USD being our limiting factor.

[prime zealot]

Also, do we value CEX MM over DEX LP depth. 34K more LP would deepen Algo or Base quite a bit.

[viscid widget]

This proposal does not require USD. Not sure where Salary comes in.
I think what we are doing here is consolidating funds from initial MM activities and providing a small kickback for operations.

[viscid widget]

By providing the same market making services at approximately 30% of previous costs
We can remove this part because it doesn't have any support

It is 10k VOI per month cheaper than the previous community market maker proposal to note

We would like to mention that the name on the proposal doesn't match the wallet. I suppose this is okay since this is just a BA proposal.

[viscid widget]

Note 17,314.198 USDT (~13M VOI) and 30,274,206 Voi

[viscid widget]

The initiative will utilize the liquidity parameters previously managed by Skynet, leveraging 12,310 USDT and 7,327,405 Voi for active market making activities on MEXC
What is the status on this account? I'm curious if there has been any activity recently

[viscid widget]

Considering that there is a substantially large pot of available funds in the treasury early stage bucket (256M VOI) earmarked for "Provides immediate funds for early-stage development and operations" I suggest that the funds for operations be taken out it instead of early incentives.

[viscid widget]

My take is that the main objective is to consolidate liquidity accounts and beginning managed market making activities utilizing liquidity available to full potential. Currently, there is no activity that we know off and at least 60% of liqudity available is not under utilization. (Current MEXC account ~20k USD (usdt, voi) vs. Other ~40k USD (usdt, voi). If deployed expect the CEX TVL to be bumped up around 110k USD.
Currently there is about 66M VOI deployed on MECX. You might imagine it difficult to make a difference with only 7M VOI.
At this time, the network would benefit from a larger presence on our only CEX listings. The rest is performance and cost efficiency.
I would be interested in knowing what the would monthly performance reports look like.

[viscid widget]

There are those among us that would like to see the funds deployed on a dex, bridged, whatever but I'll just say that deployment to CEX despite its black-box nature is likely the fairest of options. It's the neutral zone. That is if deployed on chain we would introduce a non-player into a game that is incentivize. Voi token holders would feel the burn when it is too late. Specifically, block rewards would be hit bad. Luckily, we don't have to go that route and continue to nurture the market on MEXC.

[viscid widget]

Overall, I am all for bumping up the game on MEXC versus deepening liquidity any further on Algorand or Base.

[prime zealot]

Great points @viscid widget.

Based on current stakes, this is what I calculated:

Total Community Block Rewards: 2,137,481.25
Estimated Total VOI Online: 321,439,617.17
Current Block Rewards per VOI: 0.00664971
Block Rewards per VOI After Adding Stake: 0.00631569
Percentage Decrease in Block Rewards: 5.02%
Monthly Block Rewards for Added 17M VOI: 107,366.81

The cost would be ~ 67K more VOI per month, and a decrease of 5% for community block rewards if using Algorand, Base, or Arbitrum.
It would however not increase circulating supply.

DEX LP is currently 62K USD (22K is UNIT)
DEX LP would grow to ~ 96K
DEX LP would increase by 55%

[half prawn]

The reason why it is not is because this is above and beyond. All that is being requested for extra funding beyond the MM funds is the cost of the servers. If you all would prefer we can just let someone from the community do this.

Performance reports will just be reporting monthly balance, and a report of the charts.

If you want more than that I would suggest that we push this to the community increase compenstation and put out a request of what exactly is wanted.

I can appreciate wanting DEX depth, it's more important that we have depth on MEXC.

[viscid widget]

After giving this one as much thought as I possible can, I officially move my position in support of this proposal. It increases the MEXC depth with negligible cost while having no affect on on-chain rewards. 40k VOI per month is a reasonable ask for the cost associated with provided a more dedicated service.

[prime zealot]

In addition performance charts, I think it would be wise to predefine the config for the bot as well. Then we can ensure predictable pure market making performance:

Here is an example of imitating a DEX curve on a CEX
https://hummingbot.org/strategy-configs/

order_levels: 200
order_level_amount: 0
order_level_spread: 0.005 # 0.005% increments
price_ceiling: 99999999999
price_floor: 0.0000000001
minimum_spread: 0
order_refresh_tolerance_pct: 2.0 # 2% tolerance
inventory_skew_enabled: true
inventory_target_base_pct: 50.0 # 50/50 base quote inventory target
hanging_orders_enabled: true
hanging_orders_cancel_pct: 150.0
order_optimization_enabled: true

[prime zealot]

@urban python Do you see problems with this approach?

[viscid widget]

@worthy belfry are we able to kick off the evals for this one? Thx!

[worthy belfry]

No need! the forms are static. here is a link to complete the eval for ecosystem services
https://docs.google.com/forms/d/e/1FAIpQLSc6XHc8-DF3NdtIHzytjTiXumMwqEOfHIrTKmOgLq3r6qqP4Q/viewform

[viscid widget]

My bad. Still getting in the hang of things. Ty

[urban python]

I think that's a good idea but you do need regular checks just to make sure you're not loosing too much. I understand order depth and volume are the most important metrics; it's not a 'for profit bot', right?

[prime zealot]

Do you think defining the config as part of the proposal makes sense?
What params can and can’t be constant?

[urban python]

I think I would leave it out of the proposal, might be easier to play the bot for someone who knows what he's doing.

[prime zealot]

Could you elaborate on that a bit more.
The part I am struggling with is how to determine liquidity concentration. IMO that should be pre defined to ensure we don’t lose our USDT ratio, or run out of USDT.

I don’t think any of us are knowledgeable enough or want to bet our limited USDT on an arbitrary liquidity range.

[viscid widget]

Recurring. Monthly. Up to 6 Months before term renewal. May be terminated subject to monthly reporting and performance review.
Updated duration

[urban python]

To make sure you keep a specific ratio, inventory_skew_enabled, inventory_target_base_pct can be used to set a target ratio. If your USDT get's below the target ratio, the order size on the sell side would increase to get back to the target ratio.
I also think you might want to have order_level_amount set to have increasing order sizes

If possible, start with smaller order sizes and not too many orders (order_levels) so you can see how the bot behaves in the wild without risking much.

[viscid widget]

@worthy belfry sry to bother you again ; )
I just submitted my eval. Could we expedite this one to hit the council members desk within the week? Ty

[worthy belfry]

Proposal changed to expediate. vote will be circulated with Addendum for Discord Moderators.

Council Evaluation:
https://docs.google.com/document/d/1YfWL7EI31U1buSNvbTD0IbDv1lx1a-C2Hw_IuT0vX2Y/edit?usp=sharing

[prime zealot]

I don't think using skynet's params is wise. Every param used should be justified and explained not copy and pasted from Skynet.

In it's current state this a no from me @half prawn

It would be a yes if :

1. the config file was included in the status reports(if sensitive at least the council can see it)

2. **constants **are defined to ensure close to a 50/50 USDT to VOI ratio.

3. VOI ask is reduced to match the value of USDT ~13,318,613.846153

[viscid widget]

The way I understand it is that we would be utilizing the account funds not the params

[prime zealot]

It explicity says they will use skynets params.

[viscid widget]

Yes but we should clarify ; )

I think before getting started we (the council at least) should be privy to certain configs. Also, it should be part of the monthly report.

Yeah that would be probematice because the ratio is not 50/50 but better safe than sorry. This should be a concern. The proposal doesn't get into depth with actual operations.