Cometa is a sustainable liquidity aggregator on Algorand, that combines Liquidity-as-a-Service with DAO governance. Our mission is to help projects attract long-term liquidity without having to give up ownership of their tokens and provide investors with a profitable investment instrument. One asset exposure and automatic impermanent loss protection make our solution the most sustainable in solving the liquidity problem.
Team: Strongly tech background. 5 years @ Google, VK, Yandex, crypto startups.
Founders metapunks.world, winners of the Algorand Innovative Hackathon.
Daria (CEO), Valery (CTO), Nikita (CMO & Backend), Florian (Head of Marketing), Dmitrii (Lead Smart Contract dev), Ksenia (UX/UI designer), Roman (advisor).
Having sufficient liquidity is paramount to any financial asset. Especially in crypto, where everything is tokenized and highly tradable. It is easy to provide liquidity but not necessarily profitable. In fact, a recent Bancor study has shown that roughly half of the liquidity providers at Uniswap underperformed a basic buy-and-hold strategy.
Historically, Liquidity Mining was the go-to solution to incentive LPs. However, it is not really sustainable. Another study shows that at least 42% of LPs withdraw liquidity in less than 24 hours.
The DeFi ecosystem deserves something better. Algorand has 150+ projects, including 50 DeFi & 5 native stablecoins, they all need liquidity. To help the Algorand ecosystem grow we found a new way to attract liquidity and users.
Liquidity-as-a-service — the future of liquidity
Liquidity-as-a-service is a decentralized protocol that restructures incentives and risks to improve liquidity across DeFi, which is strictly better than traditional yield farming.
It allows projects to acquire desired liquidity much cheaper and, at the same time, affords a more attractive risk/reward profile to liquidity providers by doubling trading fees and protecting them from impermanent loss.
Traditional liquidity provision exposes LP to two assets. At the same time, Liquidity providers profit from trading fees and suffer from impermanent loss. The mix of those four factors makes liquidity provision quite unpredictable. Therefore, projects have to incentivize pools with a lot of tokens in liquidity mining to compensate for this risk.
LaaS makes it much simpler: projects seeking liquidity provide their tokens from one side, and users provide the other. All trading fees are distributed to users while the project eats the impermanent loss.
LaaS not only provides much less risk for liquidity providers but also restructures their incentives: participants focus their attention on pools that they predict will generate the largest amount of trading fees. Luckily, such pools are precisely the ones that need liquidity the most. Therefore, LaaS leads to increased capital efficiency and ultimately makes liquidity acquisition cheaper.
We work on Reach smart-contract prototype and UX/UI design.
The crucial part here is designing sustainable Impermanent Loss protection. Our competitive programming background and deep knowledge of smart-contracts development help us to upgrade the SOTA solution and build it on Algorand.
We are going to launch LaaS on testnet in September and by the end of the year on mainnet.
Also, we plan to build a cross-chain LaaS solution because the liquidity problem is actually in the whole crypto ecosystem. It’s easy technically because Reach smart contracts can also compile into EVM-compatible chains.