Proposal 39: Certify & incentivize ETH margined perp market (ETH/USD)

1. Who created this proposal?

This proposal was created by the Lemma.finance team. We are a basis trading protocol that will be launching its mainnet on MCDEX in October 2021.

Basis trading consists of:

  • Using ETH collateral to enter into a 1x leverage short (on the ETH/USD perp market)
  • Using the funding payments to increase our short position as time goes on

Essentially, Lemma will be creating a huge amount of open interest on MCDEX by shorting the ETH margined markets with no leverage.

2. How does the ETH/USD pool work?

An ETH margined perpetual contract market is also known as an “inverse perpetual”. It uses USD as the quote asset but is margined and settled in the base asset, ETH.

You can see it in action here:

And add liquidity to it here:

3. What are we proposing?

We are proposing to add the ETH margined perpetual market to the certified list of markets & to the pool list of trading mining programs on Arbitrum.

The Lemma protocol needs to have a liquid ETH margined market when it launches on MCDEX, as too many consecutive shorts may otherwise “break” the market and Lemma users will face extremely bad price execution.

If we can launch our product on this ETH margined perpetual market, we will be creating a substantial amount of volume and open interest - benefiting both our users and the MCDEX project.

4. More on Lemma

The team is fully distributed and our backgrounds include working at institutions such as Amazon, Uber, Goldman Sachs, Ocrolus, Catnip, Instadapp, Columbia University & MIT.

We recently raised ~7.5 million USD from tier 1 investors in crypto (announcement coming out soon with the names - but trust us you know them).

It is in our best interest to have the ETH margined perp market to be as liquid & performant as possible since we will be using it as traders and also as liquidity providers. Our incentives are therefore perfectly aligned and we hope to grow to be a long time partner for MCDEX.

Social links & docs:

Twitter: ​​@LemmaFinance

Discord:discord.com/invite/bbFtEYhNc9

Docs: docs.lemma.finance

If you’d like to reach me directly to ask anyone questions, please email me at matthieu@lemma.finance.

Thanks!

Admin update:

4 Likes

I have checked the parameters setting of the pool. So, I support this proposal.

Besides, I am happy that Lemma leverages the MCDEX protocol to build such a great product.

4 Likes

Parameters looks good, this proposal have my full support.
Such market is strongly needed, and as a result it will attract more liquidity.

1 Like

I support this proposal

I would support this

great, this proposal have my full support.

amazing, I support this proposal, and I am really excited for an "inverse perpetual”.

Hi!

Wonder what you will deal with the MCB rewards?

If you plan to HODL, what percentage will you HODL?

How will you participate in MCDEX DAO in the future?

We are currently planning on HOLDing 100% of MCB rewards. As for MCDEX DAO participation, we intend to engage on issues we have appropriate knowledge about.

how does users of Lemma hold its ETH position if it comes with an ETH short position on MCDEX?

Or Lemma users are depositing stable coins?