June 7, 2022

IRO strategy: IROs and DPX bribes

Dopex-PapersDopex-Essentials
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What can bribes be utilized for?
To expect a triumphant flywheel built on top of one of DeFi’s most successful protocols will require lots of volume. Liquidity must be available for this to happen, so how will a protocol looking to partake in the IROs war find such liquidity?
Bribes
These can be offered in the form of any token, so Protocol X can bribe X Token to users for them to deposit liquidity by writing calls/puts at the DAOs chosen pool/strike. Using this method can be effective for DAOs to “synthetically” cash out their protocol token for USD. The DAO can afterward maneuver more efficiently their IRO strategy using this new share of liquidity and hopefully succeed in doing so.
Protocols/DAOs can use this liquidity for a variety of use cases, including:
  • Fixing Curve Rates
  • Longing/Shorting Rates
  • Hedging, among numerous others
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You can find more strategies on our blog here.
Bribes for our beloved veDPX holders
If and when IROs become the essential way to coordinate the vast amount of liquidity on Curve, DAOs and Protocols will jump on the possibility of grabbing as much market share as possible. Those who don't employ this new instrument will cripple themselves and be left gathering the leftover liquidity, if any. Thus, if Protocols/DAOs want their stable coin or protocol token to be whitelisted for IROs, veDPX holders will need to vote them on. Bribing users to pass the governance vote can be a straightforward method to access this tool and onboard vast amounts of liquidity. Massive treasuries will sooner than later want to start accumulating $DPX for the liquidity it will convey and for the power it will give to onboard new ecosystem tokens into the flywheel. To add to this, veDPX holders will also have a veCRV emission type model; they will be able to vote bi-weekly to incentivize writers of IROs with scheduled $DPX emissions. Owners of veDPX will have an advantage over prominent participants since they’ll be able to vote on IRO strikes, giving them an additional instrument on top of emissions; these benefits will be an incredible way to extend your Curve strategy objectives.
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I presume that Bribing for liquidity and afterwards last-second voting/bribing for emissions to a pool will become a norm, giving veDPX holders weekly/bi-weekly rewards.
To conclude, Dopex has successfully built a sustaining flywheel on top of Curve and now the only remaining aspect is to see how users react and utilize this new instrument to their benefit.
Until this catches DeFi trends, YOU reading this are at an advantage by being able to use this extra tool in the so-called “Curve Wars.” before others realize they are in a gunfight with a knife.
“This is a war to end all wars.”
— Woodrow Wilson, 1917

About Dopex

Dopex is a decentralized options protocol that aims to maximize liquidity, minimize losses for option writers and maximize gains for option buyers — all in a passive manner.
Dopex uses option pools to allow anyone to earn a yield passively. Offering value to both option sellers and buyers by ensuring fair and optimized option prices across all strike prices and expiries. This is thanks to our own innovative and state-of-the-art option pricing model that replicates volatility smiles.

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