---
# System prepended metadata

title: Revising Our Reserve Model

---

# Revising Our Reserve Model

Using OHM as a backing asset is the ultimate goal of this OHM-OTWO flywheel. However, the community has brought up a concern regarding using *solely* OHM as reserve - liquidity.

## Insufficient wsOHM liquidity on Avalanche
## ![](https://i.imgur.com/XVk1h54.png)

While our originally plan is to bring activities and usage of OHM to other chains, the lack of liqudity gives us serious challenges. At the time of this writing, wsOHM has ~$500k of liqudity on Avalanche. We believe such a number would limit our protocol's growth due to slippage. Therefore, O2DAO has decided to adopt a hybrid approach to include both OHM and a liquid asset as our backing reserves at launch.

## New Reserve Model
We will be using the follow assets as our reserves:
* OTWO-wsOHM
* OTWO-USDT
* wsOHM
* USDT

The reason for choosing USDT is that it's one of the most liquid assets on Avalanche. More importantly, USDT is not a reserve on OHM so we don't compete with each other. We want to emphasize that our ultimate goal is still about using OHM as our backing reserve. Therefore, we will provide incentives for using OHM in our protocol. **Note that this will be a temporary measure. In mid-long term, we will create a proposal to the DAO to adjust the ratios of these assets in the treasury by swapping them to OHM.**

## New IDO plan
We will make as few adjustments as possible to our original IDO plan to accommodate our revised financial model.

There will be two types of allocation:
1. **Allocation A**: 0.015 wsOHM (~$400) = 1 aOTWO
2. **Allocation B**: 450 USDT = 1 aOTWO

Currently, **Allocation A** is slightly cheaper (-10%) than **Allocation B**. The discounted price is for compensating the potential swap/bridge fee of acquiring wsOHM. Keep in mind you can always bridge OHM from Ethereum to Avalanche.

20% of the total OTWO supply will still be added as initial liquidity
* OTWO-wsOHM pool will open at 1 OTWO = 0.03 wsOHM
* OTWO-USDT pool will open at 1 OTWO = (0.03 wsOHM worth equivlent) USDT
* The liquidity ratio between the two pools depends on the ratio between purchased Allocation A and B.

Each whitelisted IDO participant can choose only one type of allocation. Once again, you must buy exactly 1 aOTWO.

The rest of the original IDO rules remain intact.


## Community First

We would like to thank O2ers for bringing up this concern at an early stage. Once again, we value our community and we hear every voice. With such a vibrant community, WAGMI.

