Introducing Sishi Finance protocol, a first AMM with protocol owned liquidity
Abstract. Sishi Finance is the first automated market maker (AMM) protocol that leverages the protocol-owned liquidity (POL) via a short-term bonding mechanism. The protocol enables a new way to acquire liquidity by offering SISHI tokens to buyers at a discount rate.
Most Defi 1.0 applies simple liquidity mining incentives; liquidity providers (LPs) get rewards for their assets as part of the liquidity pool. However, this creates a problem. The more liquidity gained by protocol, the less rewarding for LP, which leads to two major issues;
- Liquidity Loyalty
- Token Holders Loyalty
In most cases, Liquidity often leaves when incentives are low, and token holders tend to sell the project token. SISHI introduces a new protocol that uses its acquired liquidity by offering $SISHI to buyers at a dynamic discount rate, that way to ensure the balance between supply & demand of SISHI. The POL can use to fund its cutting-edge AMM, where the protocol can adapt the trading fees, not like other AMM.
The following are the key features of Sishi Finance Protocol:
- Users can acquire SISHI at a discount rate with a short lock-up period
- Users can stake SISHI with 1-year lock-up period to earn the protocol earning
- The protocol uses the liquidity to optimize the revenue by yield optimization or fund its AMM to earn trading fees
- A portion of the profit from protocol to buy back SISHI from the market, increase the price, the more discount for bonders
- 15 April: Migrate all SISHI pools to new POL model