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Realistic prices for OWL backup orders #862

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twalth3r opened this issue Jun 18, 2020 · 0 comments
Open

Realistic prices for OWL backup orders #862

twalth3r opened this issue Jun 18, 2020 · 0 comments
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enhancement New feature or request

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@twalth3r
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In order to ensure that tokens always have a connection to OWL, currently orders of the following form are placed (as backup, to be used only if no better orders are available):

Sell 5 OWL for at least 50000 [SOME TOKEN]

However, these orders can hardly ever be used because they impose a very high restriction on the economic viability. Take [SOME TOKEN] == GNO as an example:

Let's say we want to match a trade of GNO against some other token and connect it to the fee token via the above order. Currently, with 1 OWL-cent as the value of our min-avg-fee-per-order, at least 0.03 OWL need to be sold, meaning that the OWL order needs to buy at least 300 GNO. This amount represents the fee that needs to be paid for the trade of GNO vs the other token. With our fee set to 0.001, this means that at least 300 / 0.001 / 2 = 150000 GNO would need to be exchanged.

In the case of [SOME TOKEN] == [SOME-USD-STABLE-TOKEN], the issue persists, though a little less extreme (but 150000 USD worth of trade is still a lot). Also, it doesn't get better if more orders are involved, since economic viability would then require a proportionally higher fee amount to be paid.

The goal is to use more realistic prices for the OWL orders so that they can really function as a backup fee connection for normal trades.

@twalth3r twalth3r added the enhancement New feature or request label Jun 18, 2020
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