Key Points for Liquidity Providers
1. Attractive Fixed APRs for Early LPs
- The pools offer high fixed APRs designed to bootstrap the initial liquidity and reward early participants generously.
- These fixed returns are not diluted as new users join; APRs remain guaranteed for early LPs.
2. Initial Price Volatility
- Pryzm vs. USDC may experience significant price movements at launch.
- Pryzm Yield LP vs. Pryzm could also see notable volatility as markets find equilibrium.
- It’s important to review and satisfy yourself that the current price ranges reflect your risk tolerance and value assessment.
3. Discount Considerations When Providing Liquidity
- Some early holders, such as airdrop recipients, may look to sell their Pryzm Yield LP tokens, putting downward pressure on their price.
- When entering the pool, consider:
- What percentage discount you’d accept for derivative tokens such as cPRYZM (e.g., are you comfortable buying cPRYZM at a 30% discount to PRYZM, or do you require an even larger discount?)
- The price at which you provide liquidity effectively sets your acceptable discount.
- Use the swap feature to check live rates (currently, 1 cPRYZM is valued at about 5 PRYZM Yield LP, but this may change).
4. Liquidity Flow Dynamics
- When airdrop participants sell their PRYZM Yield LP or PRYZM, the pathway is typically:
- cPRYZM/PRYZM Yield LP → PRYZM → USDC
- Those who bought PRYZM during the LBP (Liquidity Bootstrapping Pool) initially control all the liquidity available to facilitate these conversions.
5. Incentive Payouts Timeline
- The first liquidity incentive payouts are scheduled for tomorrow. Be prepared for rewards to begin distributing shortly after you add liquidity.
Tip: Always re-evaluate both price and discount context before providing liquidity, as early market dynamics can shift rapidly and impact realized returns and risk levels.
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