There’s agreement that while the 30-day consideration offers some recovery time, it falls short in addressing the realities of the Protocol owning the DLP afterward, which effectively means taking away shares from the DLPs and locking in
There’s agreement that while the 30-day consideration offers some recovery time, it falls short in addressing the realities of the Protocol owning the DLP afterward, which effectively means taking away shares from the DLPs and locking in
losses for them.
It raises the question: why not assess which LPs were impacted by the synth reflexivity, evaluating the time and losses of each position? By doing this, each LP could receive a fair allocation of the seized LPs, and there could be a
mechanism to ensure that this liquidity isn't withdrawn immediately.
Such measures would ensure that LPs receive better compensation instead of the Protocol unfairly taking these assets.
In a quoted response: “I genuinely commend the effort put into drafting this proposal, but I cannot endorse it as it stands. The dual LPs are not treated as 'first-class citizens' by this plan.
The proposal aims to convert synth units in liquidity pools into protocol-owned dual-LP positions over 30 days, which effectively freezes the impermanent loss suffered by dual-LPs (many seeing drops of 90-99%) right at a critical low point,
removing any chance to gain from potential synth leverage.
It’s a challenging situation, and the interests of all involved need to be balanced to ensure fairness, as this proposal could disproportionately disadvantage dual LPs who have faced challenges over the years.
While there’s no clear solution at the moment, perhaps restricting synth conversion to certain price ratios for each pool could allow dual LPs to still have a chance at benefiting from synth leverage on the upside.”