Demeter protocol is a new protocol for DAOs to launch and manage decentralized exchange liquidity - without needing to know how to code. V1 of Demeter gives users the power to launch incentivized liquidity pools on Uniswap v3. Future versions will support custom liquidity shapes on major DEXs such as Balancer, Saddle, Sushiswap or anything veSPA holders prefer. Demeter V1 is launched on Arbitrum and will be expanded to Optimism, Polygon and Ethereum soon. Additional blockchains will be added in future versions.
Demeter automates the fundamental aspects of launching and managing decentralized exchange liquidity for the DAOs native token:
- Engineering support to launch and manage the farm - The Audited Demeter Farm Factory contract will generate the pool and farm contracts for the Demeter user.
- Marketing support to make the community aware of the new farm - Protocols that launch their farm through Demeter benefit from being whitelisted on the Demeter active farms dashboard. This exclusive list features all of the farms that are actively distributing rewards that were deployed with Demeter. Farmers will regularly look to this dashboard for new projects and become users of these protocols.
- Financial support through SPA incentives - When paired against USDs or SPA, Demeter farms will receive fixed SPA emissions from the SPA gauge, boosting the farm APR. Fee for launching farms will also be discounted for these farms.
On Arbitrum, Uniswap has less liquidity than Balancer and Sushiswap. This is because Sushiswap uses the simple Uniswap v2, x*y=k approach. This is simple because all LP tokens are the same, but penalizes the LP because they are forced to provide liquidity from 0 to infinity. Incentivized liquidity pools on Uniswap V3 lets DAOs benefit from concentrated liquidity - the same TVL offers less slippage compared to diluted liquidity. This directly translates to a lower emissions budget for other protocols and much more fees for LPs.
To launch a v3 farm, DAOs are currently expected to write complicated v3 farm contracts, get the contracts audited, incentivize LP deposits with only their native token, then promote this new pool. With Demeter, DAOs can launch a Uniswap v3 farm without knowing how to code and get marketing and financial support from Sperax.
Demeter protocol discounted fee of $100 for launching farms against USDs or SPA. USDs currently doesn’t have a lot of liquidity against other tokens, a joint incentivized liquidity campaign would lead to an increase in USDs trading pairs, USDs liquidity and protocol TVL. For other farms, Demeter will charge a $500 fee to use the contracts. Fee will be used to burn SPA, which will help reduce SPA supply and SPA price appreciation.