QuickSwap Governance Discussion: Should We Move Forward With A V3 ‘Concentrated Liquidity’ Model?

TL; DR:

  • DeFi moves fast. Automated Market Maker (AMM) V2 DEXs are becoming obsolete in the face of new more capital-efficient models.
  • QuickSwap would like to acquire a V3 protocol’s code license and shift to this new concentrated liquidity paradigm.
  • We’ve negotiated terms with what we believe is a stellar protocol.
  • We need up to a maximum of $350,000 from the treasury to pay for two audits (it could be less than this, this is the maximum possible)
  • This acquisition will help QuickSwap regain most of the volume we’ve recently lost to competitors.
  • Additionally, this will distribute capital more efficiently within the Polygon ecosystem and provide better liquidity and access to dynamic fees that fluctuate based on volatility.
  • We value your input, which is why we’re introducing this discussion before conducting a governance vote.
  • We would like to move quickly and we hope to pass this proposal so that we can start regaining some of the volume we’ve lost to competitors.
  • Please read through this entire post carefully before forming an opinion.
  • Once you’ve read through, visit our Reddit discussion forum to ask any questions and/or discuss with the community: https://www.reddit.com/r/QuickSwap/comments/vgzzkl/governance_discussion_should_we_move_forward_with/
  • We’re running a simultaneous discussion about introducing an isolated lending and borrowing market to increase yield opportunities and create additional revenue. Read more about that here.

Acquiring a V3 Protocol

V3 Dexs are the future of DeFi

Timeline

How would the V3 work?

Dynamic Fees

Fee Breakdown

  • 90% will go to liquidity providers
  • 6.8% will go to the Dragon’s Lair
  • 1.7% will go to the QuickSwap Foundation
  • 1.5% will go to the V3 developers
  • Note: 6.8%:1.7% is a 4:1 ratio, which is the equivalent ratio of the 0.04%:0.01% which goes to the Dragon’s Lair and Foundation at present

QuickSwap Aggregator

  • Routes through V2 or V3 depending on which has the best pricing through a combination of lowest fees, slippage, highest TVL, and arbitrage differences
  • Multi pathing — it can use both V2 and V3 in a single trade
  • Smart pathing — it can use multiple V2 and V3 pools all in one trade. A single trade may use 2 or 3 pools from V2 and 2 or 3 pools from V3 all in one trade to get the most efficient, lowest fees, and lowest slippage trades. This will significantly improve the trading experience and cost of using QuickSwap which will bring us potentially many multiples of volume.

How would the V3 acquisition affect me?

Why do audits cost so much?

What’s next?

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