Prometheus Pool

Wondering how you can make #Cardano better? Staying engaged and voting with your delegation is a huge first step!

@DanogoFinance @ItsDave_ADA @JaromirTesar Really cool that someone is finally doing this, lack of an easy to use capital efficient liquidity provision option has been a huge problem. Looking forward to being able to add some liquidity here!

@MinswapDEX Capital efficiency is what will move the needle, pools need a concentrated liquidity option (or equivalent), constant product isn't cutting it. There are primitives that allow building what essentially mimics CLAMM on Cardano

what current minswap feature would you improve and how?

@phil_uplc @ItsDave_ADA We are still stuck in constant product pools, better capital efficiency = better APY

The reason no one is deploying liquidity into ada/USDCx is that the APY for LPs is not competitive enough. The IL is too harsh, and the lp fee revenue doesn’t counterbalance it enough to beat market rates. The proposal is to use funds to subsidize that APY so that it beats market rates, and thus creates an economic incentive for ada/USDCx lp providers.

What plans are in place to achieve USDCx / ADA pair liquidity @phil_uplc / anybody else involved, because right now nearly every transaction is routed via USDCx/NIGHT which has most the liquidity. How will this be improved / what was the idea behind this because its currently ruling USDCx as pointless and it's less dominant to USDM. I'm getting tonnes of messages about people not even wanting to use it for this mentioned reason. Intrigued on the higher level plan here, now it's been some time.

@davidtwltr Highly recommend it, until we get order books and/or concentrated liquidity pools on Cardano, swapping ada/stables through dex's is going to be painful for higher amounts. Crypto backed stablecoins like djed have an advantage here due to on-chain liquidity for minting/burning

@PrometheusPool I have not maybe can try that next time I still have some djed. Djed wasn’t as bad as usdm I barely swapped any it was off peg plus slippage. Today was the first time I swapped a lot at once.

I don’t mean to keep fudding, but Cardano stables are unusable at scale. I’m a dumbass and trying to move from stable to ADA in hope’s Trump speech will p&d crypto (ik it’ll probably just dump) and it’s totally painful moving 100k usd with the slippage and small transactions to try and minimize slippage. I hold usdm, iUSD, and djed…. Seems they are equally horrible and after this experience I’m keeping all my stables on coinbase, fml.

@Quantumplation What's the biggest technical blocker to Cardano getting concentrated liquidity AMM pools that other chains have had for a while now? Do you see a path where they are implemented on Cardano in the near term? Will the closest parallel look closer to an orderbook than an AMM pool?

What technical topic do you wish you understood better? Itching to do a longer writeup for people and need some topics...

@24blackbird314 @wolf__nomadic @__fallen_icarus It's a topic I'm highly interested in, looking forward to their being something tangible to discuss

@PrometheusPool @wolf__nomadic @__fallen_icarus I agree it's a valuable building block but far from a complete solution to achieving both with one model. But thankfully there is another way 😉

No matter how much you love Cardano, we have to admit the fact that our DeFi ecosystem is still relatively immature and prone to problems. There's lots of blame going around on everything from batchers to low liquidity, but these are just symptoms of a broader problem: A severe lack of innovation! By innovation, I don't mean copy/pasting a popular protocol from EVM land. More often than not, it just results in a worse version of the same thing. These protocols are designed for a completely different ecosystem, operating on fundamentally different needs and limitations. If DeFi is a collection of puzzle pieces, then our dApps tend to be built around the wrong shapes. The AMM dex is one such mistake. Almost every single actively used Cardano dex operates on what is effectively just a copy of a Uniswap model. The reason it remains the only popular solution is because it tends to (mostly) work in an environment where liquidity is very low. But it is incredibly inefficient with capital and just does not work well for large trades. We've seen order books be attempted, which tends to be a much more natural fit for the UTXO model. It allows for very efficient use of capital and scales much much better for large or frequent trading. But in a low liquidity environment like Cardano, it functions even worse than the AMM. What if there was a UTXO-native technology that allowed dApps to combine these models? The efficiency of the order book with the accessibility of the AMM? What would you call it? I would call it innovation.

@24blackbird314 @wolf__nomadic @__fallen_icarus Yes, the trade off of CPAMM is capital efficiency for depth, resulting in high slippage for trades around market price. I was addressing your point about a technology that combines the efficiency of order book with the accessibility of AMM, I would say 2way swaps qualify

@PrometheusPool @wolf__nomadic @__fallen_icarus I'm intimately familiar with the benefit of 2-way swaps. For example, on Pondora we have n-way swaps where n can be extremely large, but even at this scale it doesn't escape the need for significantly more liquidity to achieve the same depth as an AMM - at least not by itself..

@24blackbird314 @wolf__nomadic @__fallen_icarus 2way swaps are a building block that allows you to combine these 2 models. A simple interface that allows a user to deploy many 2way swaps over a selected range achieves similar properties as concentrated liquidity AMM pools. Efficient capital that benefits from price volatility

@wolf__nomadic @__fallen_icarus Cardano swaps is a great project, but unfortunately it's fundamentally the same order book model. Its benefits are more around accessibility and indexing but even with 2 way swaps, it suffers from the liquidity requirement like any other order book.

@yutazzz With the current combination of fees and slippage, directly minting/burning is often the play. Now that there is an alternative open source front end it is easier to use as well djed.artifi.finance

With DJED, it's easy to mint burn without worrying about slippage (if the protocol's collateral size allows it). This is one of the reasons I like DJED. I'm far from being a whale, but there have been times when it would have been wise to mint burn DJED. Whales may be wise to consider using DJED first IMO

@erikdrep @yutazzz You might try an alternative open source front end developed for Djed djed.artifi.finance

@yutazzz Its a pity that the djed.xyz website does not support the Lace wallet.

@IOHK_Charles The tech isn't there yet, but it's close, multiple projects are developing ways to deploy more capital efficient liquidity. Our current constant product AMM pools are not sufficient.

There were no warnings! But levity aside, it's an ecosystem wide teachable moment and conversation about scaling up Cardano's DeFi layer in 2026. The tech is there, we have to bring the capital and integrations.

@__fallen_icarus @Jaymeon__Jones @AThrouvalas @lace_io Hm, what exactly does a launch partner look like? Also, is there anything individuals can do to lend you a hand?

@Jaymeon__Jones @AThrouvalas I can’t launch this alone. For one, I don’t know how to build an easy to install wallet. I also need launch partners. The good news is that things are moving. I’m now working with @lace_io and more teams want to be launch partners. Fingers crossed for next year 🤞

Cardano community, if you were looking for a reason to keep building, this is it. Balancer was audited TEN TIMES. Yet hackers can still come along and steal $120M while you're sleeping. This is the reality of EVM. Account-based systems invite the same failures: shared state, reentrancy, cascading exploits. The hacks are never going to end. It will never be worthy of secure, long term, important DeFi where yields are actually worth the risk. Then there's Cardano. Its deterministic, isolated UTXO design prevents this by architecture. No global mutable state. It is reminiscent of Bitcoin itself. I am saying this as a Bitcoiner. I own BTC. I don't even invest in ADA beyond what I would need for gas fees, so I'm not coming in with bag bias here. I just want a safe place to park my BTC as collateral for a loan, or to trade other assets. But having read (and written, as a journalist) countless headlines related to DeFi hacks in the past, I along with countless Bitcoiners lost faith that secure DeFi was anywhere close to ever being a reality. It was only in learning about Cardano that I realized that this was an architectural issue. I was shocked when I learned that Cardano hadn't suffered a single major DeFi hack in its history. That's why I find Cardano compelling. Combine that with the fact that it can share an interoperable token standard with Bitcoin through @CharmsDev, and I am confident that this connection is meant to be. Keep your heads up. Enough doomerism about no liquidity, no new users, etc. They're out there. You just have to go find them, and build the tools that bridge the gap. 🟠🤝🔵

@CypherDevShop (@ILikeCardano) finished the audit of the DeFi Kernel's order book and credit market 🎉 No security issues found 👀 Ideally a 2nd audit firm will confirm this result, but this is a great start! #DeFi #Cardano #CardanoDeFiKernel github.com/cypher-enterpr…

@ItsDave_ADA We need more capital efficient liquidity, we have too many constant product AMM dex's for me to keep track of. Other ecosystems have already moved on from this to concentrated liquidity and we need to either re-create that on Cardano or make order books user friendly

What is missing in the Cardano ecosystem for you to interact more?

@MicheleHarmonic Is the block producer not also an honest party fulfilling the tx? The biggest problem I see with nested tx's and more generally open intents is that they are at odds with the "mostly independent tx" assumption of Leios, as multiple block producers seek to fulfill them

What prevents a block producer that sees a nested transaction fulfilled by an "honest party" by just stripping away the parent transaction and fulfilling the nested tx themselves for fun and profit (MEV)? Has anybody thought of the implications or are we just going with it because it was the first thing that came to mind?

@serotonin_ada Their involvement with Djed has been truly unfortunate

So is DJED like COTI’s toy that they got tired of playing with, but then decided they wanted to play with again as soon as Charles mentioned them?

Somewhat hopeful for SLV's to be a capital efficient option for liquidity deployment, but the UX needs to be good enough to bring users in

@erikdrep @EdnStuff @IOHK_Charles Depth is certainly important, need to have the right incentives to get it. This why I want to see us move beyond CPAMM, returns for those pools are very low considering the risk you take on for impermanent loss

@PrometheusPool @EdnStuff @IOHK_Charles THORChain just uses standard CPAMM liquidity pools with one of the assets in each pools being TC's native token, RUNE. Most pools are however pretty deep and they also have streaming swaps which give better price execution for large swaps.

The 24H DEX Volume on #Cardano: $1M USD. Compared to: Ethereum: 4.3B Solana: 3.8B Binance: 2.8B Base: 1B Sui: 659M Hyperliquid: 426M Arbitrum: 382M Polygon: 274M Avalanche: 193M This isn't sustainable. What can we do right now as an ecosystem? Thoughts @IOHK_Charles?

@erikdrep @EdnStuff @IOHK_Charles I don't know much about THORChain unfortunately, they seem to use a slightly different form of market making unique to their design. Generally I'm comparing with DEX's on ethereum/solana which generate good APR for LP's as well as low slippage by using concentrated liquidity

@PrometheusPool @EdnStuff @IOHK_Charles I have used THORChain ecosystem DEXes quite a bit as well as having used both Minswap and Wingriders. Apart from relatively poor price execution (which I consider to be due to poor liquidity), I do not see the later two to be much different from others. What am I missing?