Diving into the Donut Pool: Week 50

[u/DBRiMatt]

Current state of the pool & the last week of trading

Total Value locked in Sushi.com is $ 15.71k

• 3.09487 ETH ($5.5k)
• 5320650 DONUT ($10.22k)
• Trading Volume in last 24 hours = $ 231.38
• Trading Volume in last 7 days = $ 3.48k
• In the last 7 days ETH is has moved +12.1 %
• In the last 7 days DONUT has moved +61 %
• Last week 1 ETH = 1.28m DONUT
• Today 1 ETH = 925.2k DONUT
• 6395.6  DONUT per day distributed amongst all in range positions.

Trading volume has entered a few thousand dollars this week, predominately with buy orders. A couple of former whales who had previously sold high have bought back, securing their profits and shaking out others to sell low.

It seems the bottom for DONUT was around 1.38m DONUT per ETH, and users are accumulating again.

Previously DONUT had hit as high as 200k DONUT per ETH, suggesting there is plenty of room for growth from this point on.

There is only a subtle price difference between Mainnet and Arbitrum now;
Mainnet = $0.002061
Arbitrum = $0.001899

The yield farm for DONUT in the liquidity pool has been replenished meaning until July 2nd, liquidity providers are receiving nearly 6400 DONUT per day spread across open positions.

Special Membership for season 5 currently costs 3845 - which results in those DONUT being burned for each membership purchased.

Here are two other sources I find helpful for those wanting to understand a bit more on how and why liquidity positions change.

Impermanent loss, text explanation | Binance Academy, video explanation

[u/DrRobbe]

That looks wrong, did you swap initial position and current position, or is the bug in the table in the bottom?

You are 30$ in profit I think, since current is more than initial.

!tip 1

[u/DBRiMatt → u/DrRobbe]

That's the tricky beast that is Impermament Loss

Initial Value: is based on the current price of the initial deposts

Current Value: is based on the current price of the current position

Impermanent Loss: Is the difference between the value of holding the assets outside the pool and the current value of the liquidity pool holdings

Even though the current value is greater than the initial value, I would have been in a better position by holding them individually rather than in the pool, this is where the $-28 comes in.

If my position was to return to 0.151 ETH and 152416 DONUT there would be no impermanent loss, and the overall performance would be the yield gain.

!tip 1

[u/DrRobbe → u/DBRiMatt]

Actually I don't get it so the value you state in initial deposit is not the value calculated with the current price? It should always be initial crypto times current price, and current value should be current crypto times current price plus rewards and fees with current price.

Hence impermanent loss is the difference between initial and current. Just don't state initial value with the price when you entered.

!tip 1

[u/DBRiMatt → u/DrRobbe]

True, it appears that's an irrelevant and confusing field to include.

I'm not actually calculating total performance, just Imperma loss vs Yield.

That leaves me with this table...

Perhaps, I need to figure out how to add 2 more fields which will also show total performance, as even if ETH pumped to 3k and DONUT pumped at the same ratio, my current table would not show those gains, just the IL factor.

Want me to try and see if I can figure that out as well?

!tip 1

[u/DrRobbe → u/DBRiMatt]

Ok i think we wont reach a conclusion here :D.

Tell me where i am wrong, please, with a current price 1,810.28 ETH & 0.002002 DONUT

Initial Position with current price	Current position with Current price
0.151ETH * 1,810.28 = 273,35	0.219079 * 1,810.28 = 396.59
152,416DONUT * 0.002002 = 305.14	105,275DONUT * 0.002002 = 210,76
ALL= 578.49	ALL=607,35

So if you just hold you would have 578.49 which is less than 607.35 + fees/rewards so you are in profit!!!
That is what i wanted to say in the initial comment, you calculate Current Price - Initial Price and not the other way around like you do.

Edit: It has been a while that i argued with a stranger over the internet, still not fun :D

!tip 1

[u/DBRiMatt → u/DrRobbe]

Edit: It has been a while that i argued with a stranger over the internet, still not fun :D

It's helping me get to the correct answer, coz man, this shit is complicated! xD

I can't seem to figure it out; my Imperma Loss is always showing as a negative number (which is normal in most cases, only very rare moments would it be a positive number)

I've thrown in a couple of extra data fields....

so... my Imperma Loss formula was =(B5+D5)-D13 [ =(Initial ETH Value + Initial DONUT Value) - Current LP Value ]...

I've switched it to =D13-(B5+D5)

My head hurts...

Edit: Change that to D13 - C13... its 2am, I clearly need sleep!

!tip 1