Open and fund a Tokenized Microstrategy (MSTR) liquidity pool. This pool will allow Rootstock users to buy and hold MSTR Stock Tokens fully on Rootstock, directly in their wallets. By holding MSTR Stock Tokens, users gain unique BTC exposure—tapping into Microstrategy’s treasury strategy for leveraged BTC positions. Through the Sailing Protocol, we bring MSTR on-chain, delivering this distinctive BTC-focused opportunity within the Rootstock ecosystem. Additionally, this initiative provides powerful marketing material, enabling us to promote “Tokenized Microstrategy for BTC Exposure on Rootstock.” We request 1 BTC in liquidity to create and fund the MSTR pool.
The liquidity pool could be opened in the Rootstock app chosen by the collective. The amount of liquidity can be greater or lower as the community sees fit. After deciding on the pool size, we can open an updated proposal. Feedback is warmly welcomed!
On one hand, 1 BTC is a lot of money. It’d be nice having full visibility on if and how this returns to the Collective treasury. Would it be returned, eventually? Would the swap fees be paid back to the treasury?
Also, what are the risks associated?
If I understand correctly, differently from a traditional LP pair, which fluctuates freely, in order to maintain a peg to Wallstreet prices a bot needs to constantly manually adjust the LP prices. What happens if volume is too high? if I understand correctly, if volume is directional and high, one of the two assets in the pair would just get sold out.
On the other hand, 1 BTC (~100k) might be a low liquidity, if demand is high (and it might be).
Don’t get me wrong, I myself have been looking for a MSTR token that has utility and can yield me a secondary income on it.
I just feel this should be well thought out to maximize its chances of success.
On one hand, 1 BTC is a lot of money. It’d be nice having full visibility on if and how this returns to the Collective treasury. Would it be returned, eventually? Would the swap fees be paid back to the treasury?
The funds can remain in a multisig, or someone appointed by the DAO can administer them. Whenever the Collective would like to remove the liquidity, it can be freely returned to the DAO at any time.
what are the risks associated?
If I understand correctly, differently from a traditional LP pair, which fluctuates freely, in order to maintain a peg to Wallstreet prices a bot needs to constantly manually adjust the LP prices. What happens if volume is too high? if I understand correctly, if volume is directional and high, one of the two assets in the pair would just get sold out.
On the other hand, 1 BTC (~100k) might be a low liquidity, if demand is high (and it might be).
We have a market making bot that is trading against Wallstreet the underlying asset – the total number of issued MSTR tokens are held at the minimum 1-1. The demanded asset is replenished by the bot that is arbitraging against Wallstreet. ~100k should be enough liquidity for most traders.
Don’t get me wrong, I myself have been looking for a MSTR token that has utility and can yield me a secondary income on it.
I just feel this should be well thought out to maximize its chances of success.