With MuesliSwap v2 launching soon we need to start thinking about bootstrapping liquidity in the MuesliSwap pools and especially in the MILK pool. Sufficient liquidity in the MILK/ADA pool is important to guarantee price stability, high trading volumes and increased interest in the MILK token. Next to yield farming there exist additional approaches that can help to bootstrap the initial liquidity. We would like to particularly discuss one model with the MuesliSwap community. This model is called the Collective Zap-In pioneered by MinSwap (Collective Zap-in: an in depth look | by Minswap Labs | Sep, 2022 | Medium).
To summarise, the idea behind the Collective Zap-In is that the project provides their native token while users provide ADA. The ADA and the token are then paired and added to the liquidity pool. The campaign usually takes around 10 days. At the end of this campaign, the collected liquidity tokens are distributed among the users and the project. In this case, 50% of the lp tokens are distributed to the users while the remaining ~50% are becoming Project Owned Liquidity (POL). Users are free to withdraw their liquidity at any point, to recover their initial investment (disregarding impermanent loss) in the form of the native token and ADA. In our case, this would mean that the MuesliSwap team provides MILK while the participants in the Collective Zap-In provide ADA to essentially bootstrap the MILK/ADA liquidity pool. All participants in the Collective Zap-In campaign will be awarded a participant NFT. The NFT can be staked in a special Zap-In farm that will have higher yield returns for four weeks. This is a new idea to further promote the MILK token and create POL that benefits the entire MuesliSwap community. We are looking for additional feedback from the community for this. The preliminary plan of the event would be as following
Start Date: 27th September (around the expected launch of Muesli V2)
End Date: 6th October
Maximum MILK available for the campaign: 500,000 MILK
Note that this is a maximum amount and we only provide as much MILK as ADA has been added to the campaign. Moreover, ~50% of the MILK provided in the campaign becomes part of the Project Owned Liquidity (POL).
This is only a first-stage idea and we are looking for feedback from the community. Depending on the community feedback we will decide whether the event will be performed and what the maximum quantity of MILK provided for the collective Zap-In will be. Moreover, we are also looking into feedback for the additional reward given to Collective-Zap In participants.