Strudel Liquidity Update

# Strudel Liquidity Update In our quest to achieve a liquid market for vBTC we are constantly iterating and updating our products. Each version of our liquidity setup learns from the previous and integrates new products that come into the space. We have a very exciting update of what's to come. ## Strudel Tokenomics Current $TRDL tokenomics consist of an uncapped supply with a fixed issuance of 7 TRDL per block. There are currently 3,453,783.229 $TRDL tokens. The ultimate dream of the Strudel protocol is to help bridge every BTC into the Ethereum network. For that reason, we are proposing to cap the $TRDL supply at 21’000,000 and adjust the issuance to coincide with the BTC model. Current estimates target February 2140 as the end date for BTC mining. The Strudel protocol has a long-time frame mindset. Our goal is to solve a very real problem within the BTC network which is that the incentives will become less attractive as on-chain activity becomes rarer as it moved to L2 networks. <blockquote class="twitter-tweet"><p lang="en" dir="ltr">i think when Satoshi wrote the whitepaper, he imagined that the network might be a lot more dynamic and evolve more than it has<br><br>the big issue is block reward is decaying exponentially every 4 years, so price has to double in that time frame for the block reward to be worth much</p>— DCinvΞstor (@iamDCinvestor) <a href="https://twitter.com/iamDCinvestor/status/1439291363783237639?ref_src=twsrc%5Etfw">September 18, 2021</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script> <blockquote class="twitter-tweet"><p lang="en" dir="ltr">i think if the security model fails, it could easily happen in the next 30 years (i.e., about 7 halvenings)<br><br>that will drop issuance to roughly 1% of what it is today btw, so BTC needs to 100x in that time<br><br>but it could happen. we'll see</p>— DCinvΞstor (@iamDCinvestor) <a href="https://twitter.com/iamDCinvestor/status/1439295493759193090?ref_src=twsrc%5Etfw">September 18, 2021</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script> ### How Strudel Fixes this Problem Strudel promotes a “perma-settled” network state which can exist on the Ethereum network and collateralize DeFI in perpetuity. This is the most efficient way to put BTC inside Ethereum forever. For this reason, we are going to issue the supply through community-approved proposals that incentivize the protocol's stated goal until the cap is met. The strudel treasury is going to play a more active role by receiving a higher % of issued TRDLs and utilizing them to acquire vBTC from the market via a smart contract fixed inflation program. This will allow the strudel protocol to own a significant amount of BTC which will enable great opportunities over time. After all, we do believe BTC is the best collateral and reserve asset especially when it is ETH Native. ## Strudel Liquidity Incentive Programs ### EthOS Covenants Farming One of the best tools available for DeFi protocols is Covenants. Covenants allow anyone to create farming setups with LP positions. Powered by the AMM aggregator, these contracts work with Uniswap V2, Balancer V1, Mooniswap V1, and Sushiswap V1. The protocol also has introduced a new set of contracts designed for Uniswap v3. These contracts enable customizable price curves and low-cost farming, by allowing farmers to pool together in shared v3 NFTs. With this in mind, we plan to issue rolling incentives to positions on Covenants. The terms of each incentive program will be voted on by the community on a monthly basis. The dev team will also issue incentive proposals with structured products that benefit the community by exposing them to different segments of DeFi. We have prepared two initial positions that we will incentivize with a new $TRDL issuance if approved by the community. ### Fixed Term Farming Contracts Our new treasury strategy will generate significant holdings that can be utilized in incentive programs. We could be one of the few protocols offering BTC yields for liquidity deposits. We will create locked fixed-term deposit contracts for TRDL liquidity pools that yield vBTC acquired through the treasury. this will allow us to offer fixed-term yields of BTC to our $TRDL liquidity providers. ### New Strudel Liquidity Pools #### Uni V3 TRDL/VBTC We have deployed a UniV3 LP and created a Covenant to issue 0.5 TRDL per block during 3 weeks totaling 96,000 $TRDL if approved the setup will start at block 13486463 to allow for everyone to add liquidity in time. This will be the core setup for this program and will be renewed automatically once, after which the community can propose different terms for this incentive. #### vNFT: A community-owned fractional NFT fund The first version of the Strudel NFT fund was a roaring success. We were able to capture a lot of the upside of the NFT season by picking strong projects which ended performing well both going up and retaining their value. We have learned a lot from that experience and redeployed the NFT fund using the smart balancer pool function. Although this was more expensive to deploy we can now add and change the weights of the tokens of the pool to adapt to an emerging market. We are going to gather a group of specialists to determine which projects to add to the fund in the future. As the space grows we believe that one of our core products will be offering structured liquidity options to enable easy access to the different market segments. We will also create a covenant for this pool using 0.5 TRDLs per block. We expect the NFT market to continue to be one of the key crypto segments and hope to continue to host the most liquid fractionalized NFT pool in the market. ## Closing Remarks This proposal is our most comprehensive overhaul of the protocol yet. It is also only a starting point in many aspects which we hope will serve to engage a new wave of interest in our protocol. We have been building different tools and have to build many more to achieve the full scope of the vision that we are laying out here. We hope that the conversation can light up to find the specific terms and parameters that will allow us to complete the mission of the Strudel protocol which is to make Bitcoin ETH native.