Feature Suggestion: Lock % of deposited pool liquidity

Overview:

In the dynamic landscape of cryptocurrency markets, liquidity is paramount for the smooth execution of trades. The concept involves a project’s ability to lock a certain percentage of liquidity within liquidity pools. This mechanism aims to instill confidence among market makers and larger participants, ensuring that a portion of the liquidity remains accessible and reducing the risk of sudden liquidity withdrawal.

Key Features:

Configurable Position Parameters:

Users can configure the lock parameters, including the percentage of liquidity to be locked. Options range from 25%, 50%, 75%, to 100%, or any value in between, using a slider for precision control. This flexibility allows liquidity providers to tailor their commitment to their risk tolerance and market outlook.

Real-time Analytics and Reporting:

The platform will offer comprehensive analytics and reporting tools, providing users with real-time insights into the status of locked liquidity, overall pool health, and their position within the market. Participants can subscribe to alerts, for when the liquidity is 24 hours from being unlocked.

Example Scenario:

Imagine a liquidity provider who wishes to contribute to a pool but is concerned about the risk of total liquidity withdrawal. They decide to lock 50% of their provided liquidity. This action is automatically recorded, and the locked liquidity is monitored and adjusted according to market conditions, ensuring the provider’s contribution is partially safeguarded against withdrawal risks.

Benefits:

Time Efficiency:

Automating the monitoring and adjustment processes saves significant time for liquidity providers, allowing them to focus on strategy rather than manual oversight.

Optimized Liquidity Provision:

By locking a portion of the liquidity, providers can optimize their contribution, balancing between earning potential and risk management.

Stress Reduction:

The assurance that a part of their liquidity is locked and protected reduces the stress and uncertainty for providers, particularly in volatile market conditions.

Enhanced Decision Making:

With real-time analytics and flexible locking options, providers are better equipped to make informed decisions about their liquidity contributions.

Implementation Considerations:

User-Friendly Interface:

The system should feature an intuitive interface that allows users to easily set and adjust their liquidity lock settings without extensive technical knowledge.

Safety Protocols:

Robust safety protocols are essential to protect the locked liquidity from unauthorized access or manipulation, ensuring the system’s integrity.

Notification System:

An effective notification system can alert users to significant changes in the liquidity pool status, market conditions, or their locked positions, allowing for timely responses.

31 Likes

An interesting side of this concept could be the potential b2b revenue stream of making it into a product. Aim at newly launched projects/tokens looking to get qualitative market recognition, and you’ve got yourself a symbol. " Meteora Locked “, " Rug-proof”…

4 Likes

For simplicity, just 4 options (25, 50, 75, 100%) would be ok. Just my 2 cents.

2 Likes

You need the slider, how else would you meme it? ( 69, 42.0 … )

4 Likes

Very detailed. I love your Article nice one. Thank you for putting it up

2 Likes

I think this is a great proposal! I believe the Streamflow team is interested in helping to build this out and think this would be a cool collaboration to work on here.

May be we can work on a simple plugin system that lives on the page that shows both % locked, time, and giving LPs the option to lock.

5 Likes

I came here to ask: Why would anyone want to lock their funds?

I leave here asking: When will this be available?!

Thanks for the great explanation. It totally make sense and it might be a feature we would use for ISC.

5 Likes

Hi all,

Background

Lui here from Streamflow. We’ve noticed the shout out during a recent community call and are keen to support this proposal. We identified around the middle of last year that Token Locks are particularly interesting for locking LP tokens, as we saw a lot of projects burning their tokens.

Current Metrics

We shipped support for Token Locks in 2023 and I’d like to share some quick metrics around adoption so far:

  • TVL in Token Lock contracts: $12+ million
  • Unique Lock Contracts: 2900+

10+ Solana projects have used Streamflow token lock contracts for LPs (both for Raydium and Meteora LPs including:

Amongst many others

Meteora x Streamflow

The Meteora team has many spinning plates and is shipping fast but we believe we can help here. Meteora integrating Streamflow Token / LP locks can be a big win-win for both parties creating transparency and helping to protect users from rugpulls.

At Streamflow we are firm believers in the Meteora team and community, unrelated to this proposal our protocol has been LP’ing JUP/jitoSOL and JUP/bSOL in Kamino for weeks and look forward to engaging in the Meteora governance process moving forward.

Streamflow offers:

  • An existing token lock product which uses our battle-tested (2 years) smart contracts which have been audited multiple times and are currently securing over $500 million (USD) in tokens

  • A well documented SDK for offering Token Locks, dedicated resources to ensure an integration that is fast and easy.

  • Existing integration in RugCheck.xyz and we will work to ensure token locks are visible in additional services

Excited to iterate on this topic and curious to see how this lands for the community

– Lui

8 Likes

I would like to propose a streamflow plugin we or any dapp could embed to allow a user to lock tokens directly on the site but also allow Meteora to calculate how many LP tokens are currently locked so we could display the % liquidity locked on site.

I think that would be a great way to work together on this.

7 Likes

Nice article. Great proposal, solid work.
Sounds interesting

4 Likes

This is how we’d love to see it implemented too.

Thanks @lui_streamflow for the support on the idea.

2 Likes

This sounds absolutely perfect for the concept I wrote about recently for presale tokens for JUPs LFG being vested through Meteora DLMMs

2 Likes

Very interesting proposal helping to create flawless working defi avoiding unexpected hickups in provided liquidity will increase institutional activity and with that a lot of growth

3 Likes

I think this is a great concept to explore. Possibly unlocking an entire new avenue of value to the market, and discovering new frontiers for the b2b aspect of Meteora.

2 Likes

interisting vote with LP pint on meteora

1 Like

I think locking would be a cool feature to have!

I assume Streamflow would take a fee on locked LPs tokens? How much would that be? Depending on the size, it might be worth it for Meteora to implement locking themselves (which, from what I understand, is not that hard to do), to avoid this tax on LPs. For example, if the fee is 0.1% on $100M of locked liquidity, that’s a cost of $100k on LPs. And this cost will only increase as its user base expands. Providing a convenient location for LPs to lock their liquidity (the same place where they provide liquidity!) would certainly boost Streamflow usage, so a profit sharing agreement might make sense too.

Can we get a visual sample of what the analytics would look like?

I assume this would be for both dynamic pools and DLMM pools? Would users be able to not withdraw but adjust their liquidity range?

2 Likes

It would just be for dynamic pools. DLMM currently does not have LP tokens and even if it did you would need them to manage your LP positions, so time locking is not an option.

For the most part liquidity locking is for memecoins and our dynamic pools are prob best suited for them.

3 Likes

This is great for the long term believers, who would not mind locking up a portion of their tokens for some time in return for more rewards (more tokens or points)

1 Like

Great proposal indeed!

1 Like

I’m a newbie and maybe my proposal won’t be the best. Perhaps these tools can encourage users to lock their funds for a long period of time

  1. Voting for Liquidity Unlock:

    • Allowing users to vote for the unlocking of a specific portion of liquidity. This could include a mechanism that allows participants to vote based on their contribution to the pool.
  2. Incentive Program and Bonuses:

    • Introducing incentive programs for participants who lock liquidity for an extended period, aiming to stimulate long-term engagement.
  3. Educational Resources:

    • Adding educational resources to the platform to help users better understand the principles of liquidity locking and its impact on the market.
1 Like