Boltz on Nostr: To expand on some things: Why would we pay anyone for doing swaps on Boltz? 💸 ...
To expand on some things:
Why would we pay anyone for doing swaps on Boltz? 💸
Balances of our wallets and Lightning channels are constantly in motion and, as directional money velocity increases, so do liquidity requirements for us to be able to reliably have enough capital on all layers to serve swaps. For instance, a pegin of mainchain Bitcoin into Liquid takes around 17 hours and the pegin capital can't be used otherwise during that time, hence it has a significant opportunity cost associated.
So we thought: What if we let users earn that swap in a, for us, favorable direction in a specific moment when things are getting imbalanced?
How does this work in practice? 🤔
Let's say we are running low on mainchain Bitcoin because significantly more volume went Lightning -> Bitcoin than vice versa. We then go and set the dynamic fee of Boltz Pro to e.g. -0.15% for Bitcoin -> Lightning swaps. Meaning users receive 0.15% more of the amount on Lightning of what they sent in mainchain Bitcoin into the swap. Once enough volume went in this direction and our Bitcoin wallet is refilled, the Boltz Pro swap fee goes back to the regular pricing. The opportunity to earn is dynamically available based on our liquidity situation.
Why launch this as a separate product? 🖖
While, as every Boltz product, Boltz Pro is available to anyone and fairly easy to use via our familiar web app at http://pro.boltz.exchange, we expect most participants to be professionals in the long run because of the following reasons:
- we plan to enforce higher min swap amounts soon after the initial launch, only larger swaps are profitable anyways taking network fees into account
- fees for e.g. outgoing Lightning payments will be tightly controlled soon, making Boltz Pro not suitable for everyday payments
- only very specific directions in specific moments will provide an earn opportunity and we are looking to incentivize reliability
- For above example, we expect Boltz Pro users to be professional Lightning node runners who are converting some inbound liquidity to
And, finally, as many things in #Bitcoin, Boltz Pro is an experiment. We want to see if there is a market before we start integrating Boltz Pro tighter into the existing Boltz product suite, build out tools e.g. for Lightning node runners to automatically monitor and execute on opportunities on Boltz Pro and more.
We'd love to hear what you think about Boltz Pro! 🧡🙏
Leave us a comment here or join us on:
https://t.me/boltzhq
https://discord.gg/QBvZGcW
Why would we pay anyone for doing swaps on Boltz? 💸
Balances of our wallets and Lightning channels are constantly in motion and, as directional money velocity increases, so do liquidity requirements for us to be able to reliably have enough capital on all layers to serve swaps. For instance, a pegin of mainchain Bitcoin into Liquid takes around 17 hours and the pegin capital can't be used otherwise during that time, hence it has a significant opportunity cost associated.
So we thought: What if we let users earn that swap in a, for us, favorable direction in a specific moment when things are getting imbalanced?
How does this work in practice? 🤔
Let's say we are running low on mainchain Bitcoin because significantly more volume went Lightning -> Bitcoin than vice versa. We then go and set the dynamic fee of Boltz Pro to e.g. -0.15% for Bitcoin -> Lightning swaps. Meaning users receive 0.15% more of the amount on Lightning of what they sent in mainchain Bitcoin into the swap. Once enough volume went in this direction and our Bitcoin wallet is refilled, the Boltz Pro swap fee goes back to the regular pricing. The opportunity to earn is dynamically available based on our liquidity situation.
Why launch this as a separate product? 🖖
While, as every Boltz product, Boltz Pro is available to anyone and fairly easy to use via our familiar web app at http://pro.boltz.exchange, we expect most participants to be professionals in the long run because of the following reasons:
- we plan to enforce higher min swap amounts soon after the initial launch, only larger swaps are profitable anyways taking network fees into account
- fees for e.g. outgoing Lightning payments will be tightly controlled soon, making Boltz Pro not suitable for everyday payments
- only very specific directions in specific moments will provide an earn opportunity and we are looking to incentivize reliability
- For above example, we expect Boltz Pro users to be professional Lightning node runners who are converting some inbound liquidity to
And, finally, as many things in #Bitcoin, Boltz Pro is an experiment. We want to see if there is a market before we start integrating Boltz Pro tighter into the existing Boltz product suite, build out tools e.g. for Lightning node runners to automatically monitor and execute on opportunities on Boltz Pro and more.
We'd love to hear what you think about Boltz Pro! 🧡🙏
Leave us a comment here or join us on:
https://t.me/boltzhq
https://discord.gg/QBvZGcW