Earlier this month when newly released $COMP token got into top20 CMC in no time it sparked a new gold rush in the crypto space.
Liquidity Mining has become a thing and after missing the $COMP train I started to look out for new opportunities.
On June 23th both DeFi projects Balancer and Ampleforth made headlines with their new liquidity incentive programs. With my limited budget, I decided to go with just one and that was Ampleforth.
Here's Ampleforths announcement of their liquidity program called Geyser
In this tutorial, I will show you exactly how to create a Pool at Uniswap for Ampleforth and later on how to earn extra AMPL with their incentive program called Geyser. Atop of that, I'll lay out the details on profits made from providing liquidity.
Here are numbers I started with on June 23:
- 1ETH (worth ~$242)
- 232 AMPL (worth ~242)
- Most of the screenshots below were made a week ago while I was documenting each step I've made.
- For this tutorial, you should have Metamask installed and possess basic knowledge on how to use it.
1. Adding Liquidity to the ETH<>AMPL Pool at Uniswap
Head over to https://uniswap.exchange/pool - make sure it says V2! in the top left corner.
Here, click Join a Pool.
Uniswaps' hub currency is ETH and this is what I'm going to use as well in this tutorial. From here, let's hit the select second token button and choose Ampleforth from the drop-down menu"
As you can see, I had 348 AMPL tokens at that time. At this step, however, the amount does not matter. We are just choosing the token type at this stage.
Uniswap will tell you that this pool already exists - simply click Join the pool link.
Here's the point where we add liquidity to ETH<>AMPL pool. It is important to note that uniswap allows only 50%/50% token pools, which means I can put only 2 tokens that are worth the same. Utilize ETH<>AMPL pair to be able to use Geyser program later on.
If you note the top right corner of this screen, my ETH balance is 1.1ETH. Also, if you remember my previous screen above with the total amount of AMPL I had was 348AMPL.
From here, I put 1ETH into the top input field and uniswap pretty much does the math for you. It calculated on the fly how much at current prices 1ETH was worth in AMPL and that is 232.34AMPL.
I left 0.1ETH in my wallet for any gas fees that occur during the pool creation process and you should have something left as well.
OK, now let's first "Approve AMPL" (expect metamask to pop a window) and give ethereum network a while to approve this action. You should see 'Pending' in the top right corner of uniswap panel. It can take a while, be patient.
After the successful confirmation, you'll see a notification in the top right corner together with a slightly less amount of ETH you initially had. This action took me 0.02ETH. Now, the only button left is Supply - click it!
You will see a final step that summarizes what is about to happen. In this case it shows me the amounts of ETH and AMPL that I'm supplying to the pool and also the amount of the ETH<>AMPL pool token in the amount of 0.00048811 - this is critical to note, as this uniswap token represents your ownership of the pool.
This token of the pool ownership is automatically applied to your metamask and we will use it later on in Ampleforth's Geyser.
Simply click Confirm Supply and you are done!
Give it a few minutes again for the transaction to be confirmed by the ethereum network.
After the transition gets confirmed you will see the current stats of your position within the liquidity pool.
Hurray, now I'm earning fees on ETH<>AMPL transactions in the pool.
2. Earning extra $AMPL from the incentive program - Geyser
Remember that 0.0004881 amount of the token I received from uniswap that represents the part of the ownership of the ETH/AMPL Pool? Now we are going to use it. Don't be surprised if you don't immediately see it in your metamask wallet. Mine showed up with a delay.
Head over to https://www.ampleforth.org/geyser/
You'll see a very simple dashboard. With the first red circle I have marked the amount of the ownership token that I have in my metamask. Geyser automatically reads that number from your wallet. Secondly, hit MAX to deposit them all into the Geyser.
Geyser will show you estimated earnings based on the current APR. Note that it was on June 23th and APR was crazy high and so was my earnings estimation.
Wait a few minutes. The first time I did it I had some error from their end. If it happens to you as well, simply refresh the page and do it again.
15mins after the transaction was complete I saw 0.43AMPL rewarded to my account. Wow, that was quick. I quickly noticed that APR changed a bit over this period and it turned out that my rewards are also being estimated on the go.
Important! After successful connection with Geyser, you won't see your AMPL<>ETH pool stats at uniswap anymore, despite them being there and earning you fees.
Here's how my Accrued Rewards differ during the past week:
23 June: 0.59AMPL @ 584% APR
24 June: 0.78AMPL @ 92% APR
25 June: 0.87AMPL @ 73% APR
26 June: 1.07AMPL @ 46% APR
27 June: 1.29AMPL @ 49% APR
28 June: --forgot to note it down--
29 June: 1.73AMPL @ 49% APR - payout day (see below!)
To sum up, after 7 days of providing a relatively small amount of liquidity (1ETH<>232AMPL) I was able to make an extra 1.73AMPL atop of uniswap fees with Geyser liquidity program.
Let's see what I've made at Uniswap during this period:
- 1.33ETH (vs. 1ETH at the beginning)
- 194.6AMPL (vs. 232AMPL at the beginning)
And these are worth (as of 30 June 2020):
1.33 ETH = 300.5USD
194.6AMPL * $1.92 = 373.6USD
Total = 297.45 + 307.468 = 673.6USD
Now, let's distract from it the initial amount I started with:
$673.6 - $484 = $189.6 Profit.
It is important to note that 4 factors contributed to this profit, and these are:
- AMPLs positive rebase
- AMPLs price increase
- Pool fees
- Geyser incentive rewards