RE: Advanced Splinterlands Pre-Sale Math - SpreadSheet Fun
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Hi @Jarvie,
After watching your youtube video about the DEC:SPS liquidity pool I immediately tried it. I transferred out 1000 DEC from my account. I found out that my 1000 DEC needed to be matched with SPS amount. So what I did was to convert some of my DEC to SPS and put it in the liquidity pool. It was approximately a 50/50 split.
I checked my air drop points the next day and saw it was only 969 air drop points for the liquidity pools. (if I had left it in DEC, my air drop points would have been 1000 points)
There must have been something I did not understand because I was expecting that the air drop points would be doubled the DEC I put in and I was not expecting that I had to match my DEC amount with the equivalent SPS amount.
Perhaps you could enlighten me on how this works and also on the numbers I see on the 'Your Positions' Tab (Shares, Base Quantity, Quote Quantity and Rewards).
Thanks for your time and passion in doing the things you do.
Hi @xxxdoodzxxx
Your amount of SPS and DEC in the Liquidity Pool (LP) changes all time if the price of the tokens are moving up or down. In LP there is the possibility of impermanent loss.
The pool keeps the value each time 50:50. If DEC goes up and SPS stay the same or go down... your Pool decreases your DEC amount and increases your SPS.
If you are in a LP with a stablecoin like DEC/BUSD and DEC gets +300% the pool decreases your DEC and increase BUSD (which stays at 1USD).
Your reward gain from the +300% would have been higher without using LP. That's the impermanent loss.
The amount of DEC in "your positions" at the aidrop snapshot time counts.
I hope this helps.
Hello @nelthari, thanks for your reply, makes a lot of sense now why the small increase from yesterday. Thank you very much.
You get 2x airdrop points on POOLED DARK ENERGY CRYSTALS, so since you sold half of your DEC to provide the 50/50 liquidity pair requirement you still got double points but on only HALF of the tokens you started with.
The best way to use this strategy is to hold whatever amount of DEC you are comfortable with and then use the SPS earned from the daily airdrops to pair off whatever amount of DEC is required per day.
This way you can continue to hold your SPS tokens if you think it will appreciate in value or maybe want to stake them later. Otherwise the option would be to sell the SPS as it comes in daily and buy more DEC and it would effectively earn you the same amount of airdrop points without risk of impermanent loss from the AMM pooling.
hi @hotsauceislethal, I understand the strategy now. I have also seen what you meant by the possibility of decrease/increase of air drop points in relation to the price fluctuations of DEC (yesterday my airdrop points from the LP was 968 and now it is 1041). Thanks a lot for replying to my query.