Performance review of iBTC/DOT pool on Arthswap

Pool description
A treasury proposal (link to proposal) for using treasury funds to incentivise iBTC/DOT pool on Arthswap passed with community voting in November 2022. The pool was setup to bring iBTC into Astar network, it was also the first step for getting iBTC qualified as a collateral asset on the lending/borrowing markets like SiO2 and Starlay on Astar.

The main objective for incentivising this pool was to build enough liquidity for iBTC on Astar to achieve qualification as a lending collateral asset. Arthswap proposed to provide 2,934,000 ARSW incentives and Interlay treasury would match with 312,000 INTR. The targeted liquidity of the iBTC/DOT pool by the end of 3 months incentive period, was 200k USD. However, the rewards were not fully distributed by the end of the incentive period.

Arthswap farming pools deploys a rule of “the multiplier”, which is the weight of the percentage for the ARSW farming reward distribution to the pool, changes according to the liquidity, starting with a multiplier of 1. The more liquidity is in the pool, the higher the multiplier could get and the more rewards could be contributed by ArthSwap. At the end of the incentive period, the pool size did not hit the line which changes the multiplier, therefore there remains a large percentage of unused INTR incentives. Arthswap team, as agreed, refunded the unused reward allocation for INTR to the Interlay Treasury.

Pool Performance Details:

Incentive length: 3 months
Incentive period: 2022/11/09 → 2023/02/10

Total incentives planned:
312,000 INTR
2,934,000 ARSW

Target TVL at the end of incentive period: 200,000 USD
TVL (02/06/2023): 49,820 USD

Estimated APR at Target TVL:
APR (02/06/2023): 23%

Total INTR incentive planned: 312,000 INTR in 3 months period
Actual INTR incentive payout: 12,800 INTR in 3 months period

Incentive surplus: 299,200 INTR
The incentive that has not been paid out by the end of 3 month period has been returned to the Interlay Treasury.

Transaction block:


iBTC/DOT pool has achieved the purpose of bringing iBTC to Astar community. However, the performance of the liquidity pool was below expectations. The incentive payout structure on Arthswap did not allow the distribution of all incentive within the planned incentive period, which led to the result of this pool not hitting the TVL target for qualifying iBTC as a lending collateral asset on Astar lending markets. Surplus INTR incentives have been returned to Interlay Treasury team.

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