Next steps for STEP
In the coming weeks, the first phase of emissions will be running out on the existing Raydium Fusion STEP/USDC pool- our initial engagement with Raydium was 3 months of emissions on the Fusion pool then to re-evaluate at that time if we continue or choose another pool, 3 months have almost passed. We have enjoyed working with the Raydium team over these last few weeks and months and we have the choice of renewing emissions with the Raydium Fusion pool or not.
At this time we won’t be renewing emissions and are working on another option which we think is a better STEP liquidity sink, has better fee capture and all around beneficial to STEP tokenholers. This we are calling ‘Phase 2’ for STEP
How will Phase 2 Work?
As previously discussed, we are rolling out an AMM which we think will fulfil a few important roles in the Solana ecosystem. There are already AMMs in existence so why will this be any different?
- STEP Emissions will now be on the Step AMM pools.
- All tokens will be priced against STEP (similar to Bancor) this creates a new massive liquidity sink for STEP and also ensures arbitragers need to arb through Step pools earning fees denominated in STEP for LPs which otherwise would not be possible with third party AMMs.
- Fee generation on the AMM goes 100% to our revenue address which will later be distributed to stakers with a lock.
- The Step AMM will support permissionless emissions pools for new projects wanting a place for their token to start trading. Projects will be able to create a pool with their token and add emissions to it.
- Tight integration with our existing Swap router for Solana, our competitive fee structure should ensure the Step AMM sees consistent volume.
- LPs and Vault contracts can be used as one side of an AMM pair and be priced against STEP
- Currently many new tokens lack DEX markets on Serum, the Step AMM will be an easier source for teams to create markets and get pricing than setting up dex markets making it a go-to spot for long tail assets.
- Better predictability for emissions for teams
We are also intending to price STEP emissions against other assets other than USDC with some exciting feedback loops to come with that.
Next Steps July/August
Raydium have notified us that due to block timing estimations that there is still more days than initially thought remaining on emissions- with estimates assuming ending of emissions approximately around the 29th July from this (https://explorer.solana.com/address/4n3vRUk3wdtbGWgMFSaxUcnGLKwa2wiWVhqw7kv9JDVS) contract (not not all the STEP showing is still owed, its just unclaimed).
Obviously this was not our intent, we have an emission schedule and now that will be disrupted. Therefore from the time it takes for the emissions to end on Raydium and the new pools to be live there will be no new emissions and the Raydium STEP/USDC LP will be discontinued. We estimate this time to be 2–4 weeks. LPs will of course be able to move their liquidity out of the old pool as they wish and we will be indicating what the new emission pools will be closer to launch. The emissions for week 13 and onwards will be void for the number of weeks that emissions are out of action with the remainder going back to treasury at the end of our 102 week emission cycle.
This is an exciting new Step for STEP and unlocks new value accruals, liquidity sinks, strategies, features and more so we think this is most definitely the best option for STEP token holders. Of course our aggregator takes into account all liquidity pools (Serum DEX, Serum AMM, Orca) and will continue to source the best price across multiple pools for our users and the new AMM will plug into that.