Gro partners with Olympus, Visor, and Fei/Ondo to deepen GRO liquidity

Gro is excited to announce our new liquidity partnerships with OlympusDAO, Visor Finance, and Fei Protocol & Ondo Finance. Each of these partners will bring their respective expertise in managing liquidity to improve the price stability of Gro DAO tokens (GRO), making it easier to swap for GRO without high slippage or unnecessary price volatility.

Why GRO needs deeper liquidity

It’s been 7 weeks since Gro DAO token (GRO) launched through a Balancer Liquidity Bootstrapping Pool. In the recent weeks, GRO has had $12–20M liquidity ($20–34M paired liquidity) across Uniswap v2 and Balancer, where users can swap for GRO with USDC, WETH, Vault (GVT) and PWRD. The daily trading volume is at $2–6M across these pools.

With GRO reaching a wider audience and becoming actively traded after the token launch, the community has brought up the benefits of having deeper liquidity — allowing larger transactions to take place without causing unnecessary jump in token prices and reducing slippage for each trade.

If you want to go far, go together

Our first reaction was to consider seeding more GRO liquidity in existing automated market making pools with treasury assets. It would be capital-intensive as Gro DAO treasury has to supply both GRO and the paired token, reducing treasury resources available to support protocol growth initiatives. Another route is to boost liquidity mining rewards but it would see diminishing marginal returns given our already high APY rates (mid 3-figure) offered in the incentivized pools and take away incentives and resources from driving TVL.

Enter liquidity partnerships. As DeFi moves to a new paradigm of liquidity management, Gro DAO now has a much broader range of programs available to increase token price stability and lower slippage. Liquidity can now be acquired (protocol-owned liquidity), provided in a more capital-efficient way (active liquidity management), and rented at a much lower cost (liquidity-as-a-service).

Forming these partnerships will not only help GRO achieve deeper liquidity, but also build bridges between Gro and these pioneering DeFi protocols and their DAOs to pave the way for further collaboration. Becoming more interwoven the DeFi community would also increase Gro’s brand awareness, making partnership a better solution than solving this all by ourselves.

OlympusDAO: Protocol-owned liquidity

OlympusDAO launched the Olympus Pro bond program to facilitate protocol-owned liquidity. Gro DAO has just voted to pass the partnership proposal where Gro will acquire GRO/PWRD LP tokens at a rate of $250K/month. Bondholders will have a 14-day vesting period after bonding to receive the full bond payout in GRO tokens. LP tokens acquired will earn trading income for Gro DAO treasury while providing liquidity in the market.

The bond will be launched on Friday 19th November. The community has dubbed it the “grohmie” bond — we trust that this would not only be a bond for LP tokens but a bond between these two communities.

Visor: Active Liquidity Management

Visor Finance offers active liquidity management on Uniswap v3 where it requires less capital to achieve the same slippage seen in other AMMs. Through this partnership, Gro DAO will seed a total of $1M with a 80/20 split between GRO and WETH on Uniswap v3 where Visor will manage the liquidity to ensure high capital efficiency.

This partnership not only deepens overall GRO liquidity but also marks the first time that the DAO brings liquidity to Uniswap v3. The pair will be launched on Monday 22nd November. If this pool sees a high trading volume, we will have the flexibility to scale up to further lower slippage.

Fei-Ondo: Liquidity as a Service

Fei Protocol and Ondo Finance offer a Liquidity-as-a-Service (LaaS) solution to deepen liquidity through pairing our tokens with FEI stablecoin. Through this partnership, we will deposit $5M GRO tokens into an Ondo liquidity vault where Fei Protocol matches our deposit to create a new GRO/FEI pair on Uniswap v2 with $10M pool liquidity.

This arrangement not only deepens GRO liquidity but also taps into existing FEI pairs to make trading GRO with other tokens more efficient. In addition, the Fei DAO will also allocate TRIBE incentives to this pool for those who stake their GRO tranche tokens at a rate of 10K TRIBE per week for every $1M GRO tokens in the vault.

The first vaults will be launched on Monday 22nd November with $10M pool liquidity.

This is just the beginning

As we venture into new ways of managing liquidity on DeFi, we’ve taken a cautious approach in launching our liquidity partnerships with lower initial allocations. This allows us to test the water and understand the pros and cons of each approach.

Once the programs prove successful, we are flexible to make bigger commitments under Gro DAO governance. Our treasury also has the capacity to explore and allocate to new programs as opportunities arise. Stay tuned for updates and reach out in our discord if you’d like to be one of our Liquidity Partners!