INITIAL POOL STAKE OFFERINGS IN CARDANO: Minswap
This article is a subsection of a larger article “INITIAL POOL STAKE OFFERING IN CARDANO: a critical overview”
- This is not financial advice. I have no training whatsoever in the finance sector and I am in no way or capacity a licensed financial advisor.
- I recently became an ambassador for Flickto, which is also running an ISPO.
Minswap — reviewed by PurritoGeneral
This was the first ISPO to use community pools. This decision was very well regarded, since Minswap partnered with single pool operators with a small volume of ADA staked to their pools and who kept all rewards from block production. No ADA funds were allocated to Minswap in the process. Good guy Minswap. The criteria for candidates to qualify were transparent (e.g., maximum 2M ADA staked, maximum 5% variable fee and minimum 20k pledge). The 25 pools that ended up participating in ISPO were selected randomly from the eligible candidates.
Another unique aspect of this ISPO is that participants were rewarded MIN and MINt, the second being a token that can be converted into MIN by providing liquidity in the DEX and that acts as a booster to yield farming. This was obviously an effort to attract initial liquidity and an ingenious one. However, I think the team had trouble conveying this message properly to their delegators. I speak for myself, but I didn’t quite grasp the rate at which MINt tokens would be converted to MIN, which in turn made me underestimate the value distributed in this ISPO. Another factor that reduced my interest was the fact that the ratios were unknown and I didn’t want to end up with more tokens than those that I could provide liquidity for. As meticulously explained by the team, when the DEX launches yield farming (projected for Q2), MINt can be fully converted to MIN. Delegators will be able to do so over the course of one year. Providing liquidity in the multiple pairs will generate LP tokens that can then be staked with MINt tokens for both yield farming and conversion to MIN. The booster factor (t) will vary depending on the LP pairs. Details are provided in an article, that includes comments and suggestions to clarify this brain twister by some.ONE. who is a total illiterate in liquidity farming.
The dashboard was fairly well detailed, including per epoch breakdown of the stake provided and the rewards, but it was only ready after 4–5 epochs from the start. Not a big deal, since all information was made available to delegators, and it was possible to calculate the rewards manually within a very low margin of error. Nevertheless, it is always best to have confirmation.
It took over six months of closely following ISPO’s to put this together and ultimately for the benefit of the whole Cardano community. Please contribute. Funds raised will be used to buy an engagement ring. Wish me luck!