Sirwin
Sirwin

I just added funds to the MAYA Protocol Fair Launch — my exact numbers and expected returns

By n1ce | DeFi Adventures | 16 Mar 2023


This is the complete story of how and how much I added in crypto to the MAYA Liquidity Auction and what I expect in return.

I wrote about the MAYA Protocol and their Fair Launch with a Liquidity Auction before, click here to get up to date.

MAYA Protocol overview

In short, they are a friendly fork of THORChain, developed for two years and completely audited. They want to offer non-custodial crosschain swaps which I think are more important than ever. In the next two weeks they collect liquidity to bootstrap their system by offering their native token $CACAO to everyone that pledges USDC, BTC, ETH or RUNE.

As described in my previous post about MAYA, if the liquidity auction is successfully raising the required funds (it acts a bit like a crowd-funding campaign as it will return the funds if the goal is not met) they will match the pools with the equal amount of newly minted $CACAO tokens. $CACAO acts like the $RUNE token for THORChain. It economically secures the assets in the pools.

My plan:

I decided to add $BTC, $ETH & $RUNE. So far I was able to add BTC and ETH through THORWallet DEX. This is a ref-link that saves you 5% in trading fees if you create a new wallet for this auction. More about that later!

Getting your $RUNE to work for you

Adding $RUNE is very interesting, as it is currently the only way to add single $RUNE and get it to work. I don’t have decided yet how much of my $RUNE I will pledge but probably around 50%.

The other option is to pair it with an asset on THORChain, but here you get a 2x return plus a $MAYA airdrop (if you are Tier 1, more on that later).

How I did it using a Ledger Hardware Wallet

I tried to connect my XDEFI wallet to the THORWallet DEX but it would never recognize my Bitcoin wallet. This is when I realised that Ledger is not supported directly.

So I created a new THORWallet through the website (it is also possible via mobile) and sent funds to the wallet. The receiver address in THORWallet was a bit tricky to find. You have to go to the detail page of every asset and click on “Receive”. There you’ll find the address.

After sending funds to the BTC and ETH Addresses of THORWallet, I was able to participate in the auction.
One annoying thing was that as I wanted to add the maximum of funds from the wallet, I had to calculate the gas fees myself. You get a rough gas fee calculation but it’s in Dollar and your pledged amount is in $BTC. Fortunately you can try a higher amount and quickly go back if you get the “not enough funds for gas” error.

Notice: the gas fee setting is modifiable to only pay ~$1 instead of almost $6 that I paid for adding Bitcoin.

I also made a slight mistake and maybe I can already save you a few bucks. If you click on the cogwheel next to “Urgent” you can set your gas limit for the transaction. I went with “Urgent” as I did not know it could be lower and spent almost 6 bucks instead of ~$1.

This is how my dashboard looks now after adding the funds:

These funds are part of Tier 1 of the auction, that means they can’t be removed for 200 days after the auction starts. This is to ensure stability of the system. They will receive an extra $MAYA token airdrop and will be completely refunded (except for gas costs) in case not enough funds are raised. Additionally, they receive the highest contribution of $CACAO tokens of all the tiers. These are all the reasons that made me chose the Tier 1. This guide can help you chose your tier.

The Tiers look like this:

MAYA Protocol Liquidity Auction Tiers

I expect a 2x ROI or more as my assets will be matched 1:1 by $CACAO + any amounts that are given up by the other Tiers which only expect 1.8% and 1.34% ROI respectively.

I will also receive the $MAYA airdrop. MAYA is the revenue token which allows holders to earn a share of the MAYA Protocol revenue. The team only receives a portion of this and is therefore incentivised to work hard to increase protocol revenue.

Risks

The risks are obviously the impermanent loss in the pools for the next 200 days (should Bitccoin or Ethereum outperform $CACAO or the other way around) but there is an impermanent loss protection directly built into MAYA Protocol. 10% of all $CACAO minted is used for this.

Since Maya’s IL Protection (ILP) has a 50-day cliff + 100/400-day ramp, early withdrawals may face some of this IL (Source).

Please check the docs and blogs for yourself, I cannot guarantee the correctness and none of this is financial advice.

Wrap up

Now I just wait for the $RUNE pool to be available and for the result of the auction. Will it be successful? I have a gut feeling the needed assets will be added very quickly.

How about you? Do you plan to participate in the Liquidity Auction?
Leave me a comment here or DM me on twitter for any question!

If you liked this article, please consider clapping to help it reach more readers. You could also sign up for medium using my link (click here) — no extra cost but great support for my writing.

Have a great day!
n1ce

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n1ce
n1ce

I love to teach you Decentralized Finance on Fantom and THORChain Follow me on twitter: https://twitter.com/n1ce34007134


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